The recent frenzy to record everything from profile pictures to meme-themed cryptocurrencies has overwhelmed several blockchain networks in the past week, causing them to falter.
Recent days have witnessed disruptions in networks like Arbirtrum, Avalanche, Cronos, zkSync, and TON, all experiencing partial or complete downtimes due to the high volume of inscriptions. The latest to experience issues was the modular data availability network Celestia, as confirmed by industry experts who shared a snapshot of its block explorer on December 18.
There have been numerous instances of bulk minting on the Celestia network. “Our team is diligently investigating the issue. We can verify that an overwhelming number of inscriptions led to the sequencer malfunctioning, halting transaction processing,” stated Arbitrum on December 16, during a disruption that lasted 78 minutes.
In response to similar challenges, Cronos developer Ken Timsit announced a network upgrade introducing dynamic transaction fees that adjust based on transaction volume. “This enhancement allows the network to better handle sudden increases in traffic, such as the recent surge in inscription demand,” he remarked.
This trend mirrors the Bitcoin Ordinals concept, which facilitates on-chain inscription of data like text, images, and videos. People have realized that similar inscriptions can be executed on Ethereum and other EVM-compatible chains by embedding data in transaction calldata.
Crypto developer Shardul Mahadik elaborated: “Bitcoin inscriptions are akin to writing on the smallest unit of currency (UTXO model). EVM inscriptions are comparable to using the notes or remarks field in a payment app, where you send a zero-value transaction to yourself and include data in the notes field (account model).”
Recently, most of these inscriptions have been BRC-20-type tokens, inspired by various collections such as Bitcoin Frogs, and new token tickers like BMBI, BEEG, and GROK, as tracked by Ord.io.
Crypto researcher “cygaar” suggested that users are engaging in self-directed token mint and transfer transactions with call data due to the low cost.
This activity, aimed at replicating ERC-20 successes on other chains, often involves the same users repeatedly conducting small mints, exploiting the lower minting costs compared to smart contract interactions.
Bitcoin developer Eric Wall earlier this month speculated that EVM inscriptions might offer retail investors a way to access low-cap crypto assets. With ICOs being heavily regulated and restricted, and many projects initially available only to venture capitalists or accredited investors, he noted, “Using gas or occupying block space remains one of the few distribution methods openly accessible to retail investors.” He referred to inscriptions as “BRC-20 derivatives,” explaining, “Since anyone can partake in the issuance of a specific ticker (by mining it through burning block space) from the outset, it’s one of the rare opportunities for retail investors to get in early in a manner that’s not yet clearly illegal.”
However, Michael Rinko, an analyst at Delphi Digital, questioned the rationale behind this trend. Speaking to Bloomberg, he said, “To me, it just seems like the latest craze. There’s no logical explanation for it.” Meanwhile, blockchain investigator ‘ZachXBT’ cautioned against crypto influencers promoting dubious coins in a December 19 social media post. “Despite the market’s recent uptrend, they still resort to these tactics for profitable trading,” he warned, adding, “Consider this a cautionary note, so don’t blame me if you end up on the losing end.”
As Cointelegraph reported on December 18, inscriptions on EVM-compatible chains have seen a significant increase recently. Data from Dune Analytics revealed that over $6 million was spent on gas for inscriptions on December 18, with a record $8.3 million spent on December 16.
However, on the same day, Polygon founder Sandeep Nailwal observed a shift in minters moving to Polygon, attracted by its more affordable gas fees.
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