Building a Bitcoin Ordinals Wallet

While Ordinal inscriptions have been around for the better part of 2023, the process of building the best wallet for Ordinal NFTs is still an ongoing process. 

On October 14, our team attended the first ever Inscribing Amsterdam to meet members of the Ordinals community. There, we informed users of what Leather is doing to create the most solid, self-custodied Ordinals wallet to connect them to Ordinals marketplaces. 

Our general manager, Mark Hendrickson, took the stage as part of the very first panel at Inscribing Amsterdam. "Beyond the Blocks: Building Ordinals Infrastructure '' was moderated by Elizabeth Olson, Head of Growth at Xverse Wallet, and dove into how the Ordinals protocol and digital artifacts have impacted the Bitcoin blockchain. Joined by Gamma.io co-founder Nick Sainato, NeoSwap.ai Chief Experience Officer Hamza Diaz, Hendrickson delved into what it has been like creating not only an advanced Bitcoin wallet, but a Bitcoin Web3 wallet that provides support for Ordinals in a wallet app.

So, what has it been like building out Leather's Bitcoin Ordinals service? We have highlights from Hendrickson's panel below. 

Why Focus on Ordinal Inscriptions?

Elizabeth: What made you decide to go on-chain and focus on inscriptions?

Nick: As builders in the first Stacks ecosystem, we sort of had this thesis that there would be a future involving programmability and digital assets on Bitcoin. L2s like Stacks are certainly one way that can happen, but I think that when the Ordinals protocol came about, it was such an obvious way to be even closer to Bitcoin L1. That, of course, has always been the goal: to be as close to Bitcoin as you can possibly be.

We got started quite early. We had some test inscriptions up around inscription 600 and then, as you know, it was pretty challenging to get a full [Bitcoin node] synced up. We were, I think, the first really automated inscription service and we’ve tried to really scale that up. 

Hamza: We were very aware of how Stacks worked using Bitcoin as a settlement layer, so we had that expertise and really believed in Bitcoin as a technology that could really leverage digital assets. So when we saw Ordinals, we wanted to ride the wave and explore how we could provide solutions, especially for collections and artists. The way NeoSwap really helped them was to provide smart auctions. Smart auctions help users bid on anything, and you can actually bid on as many items as you want after you set the limit for how much BTC you really want to spend. This has helped a lot of collections and we’re still having smart auctions on demand. 

It has been quite exciting. We've been looking at our partners like Gamma, Leather and Xverse, and we all wanted to take part in that historical moment.

Mark: Historically, I think a lot of folks who are working on L2s started on Bitcoin L1 and just found that there were so many limitations. You just couldn’t do many things on Bitcoin, so we were driven to go to other solutions and explore that space. But when Ordinals happened, it made us go, “Wait, there’s an opportunity again. Let’s go back and start to connect everything.”

For years now, the whole idea was to build Web3 on Bitcoin itself, and that’s the most important thing. Ancillary technologies are just supposed to be helpful for that, but they’re not supposed to be the focus.

Building An Ordinals Wallet and Ordinal Services

Elizabeth: How have you been tackling these new challenges and making sure you're first to market with support for these new technologies? Or is there another focus?

Hamza: One of the challenges that we’re working on is the ability to swap one Ordinal for another Ordinal. We don’t have smart contracts, so we cannot make an escrow for that. We’re exploring ways we could make that work because one of the technologies that NeoSwap provides is smart swaps. Smart swaps are quite interesting because they offer a new kind of bartering process. Imagine if you could literally swap Ordinals between users, and use a very small amount of bitcoin to make that happen. We’ve done that on Stacks and we may explore that with Ordinals at some point. 

Nick: It’s always about striking a balance when these new technologies come out. That’s why I think it’s important to have a core vision and thesis in mind, and then decide which things fit within that. We’re really just trying to get a brilliant user experience and interface – that has always been our focus. We’re all in this experimentation phase and we love trying new things, but ultimately we have to keep our eyes on the prize. It’s about the hundreds of millions – or billions – of people who can benefit from building on Bitcoin and using Bitcoin.

Mark: I think in crypto there is this strong culture of being first. That’s great on one hand, [but you risk sacrificing quality]. As a result, the focus on sustainable use cases and asset types also suffers. Now, we’re seeing [a sort of] bear market in Ordinals as well, and I think that’s because we’ve just got through a lot of speculative mania around Ordinals. That is natural, in some ways, for the industry, but it’s on us to mature from there and not just focus on the new hot thing. 

All of our products, our arts and our assets – what we’re building needs to stand the test of time. I hope that we actually smooth out these swings because if we don’t, it will be very hard to attract mainstream users. This is a question that I would pose to all of us: how can we approach our work a little more thoughtfully to not necessarily be first, but to produce something in the world that actually has longer-term legs?

What Use Cases Can Ordinals Bring to Bitcoin?

Elizabeth: What are the use cases for Ordinals?

Hamza: In my opinion, if there’s anything that requires durability or longevity, we definitely need to explore Ordinals. For example, say we want to digitalize the Mona Lisa and we want to do that for a longer period of time, Ordinals might make it a “phygital” item. I believe that Ordinals can jump in for that particular use case, but we will definitely see other use cases that don’t require longevity.

Mark: There may be moments of crisis where things happen that can threaten the existence of data. We think that if we put something online, it seems like it’ll be relatively safe. [In 20 years], that might not be the case and there will be threats to digital storage. So Ordinals is, I think, the best way to say, “We’re going to put something somewhere that, even in the most [dire circumstances], it will persist.” The use cases that are the most important are the ones that [can help data survive those moments]. 

Elizabeth: What are you most excited about? 

Mark: I’m interested in the question of programmability. I think that to get Ordinals to the next level of sustainable use cases and value within applications, we need to figure out a way to make Ordinals programmable. There are ways to do this, whether on the Bitcoin L1 or side chains. We have to make them more programmable and move away from the situation we have now where we’re very reliant on indexers that are centralized and fragile. That’s going to unlock a lot of new use cases.

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