Ethereum's Blobs Used to Create Inscriptions Similar to Bitcoin

Data from Dune Analytics shows that blobs, the new data storage mechanism from the Dencun upgrade, are being utilized to create Inscriptions at record speeds.

Ethereum's Blobs Used to Create Inscriptions Similar to Bitcoin

According to on-chain analyst Hildobby on Dune Analytics, the Ethereum network has witnessed 6,986 Inscriptions created to date, representing 40% of the blobs utilized, overshadowing other Layer-2 solutions like Arbitrum, Optimism, Base, and Linea.

Share of blob usage from Inscriptions compared to other Layer-2s. Source: Dune Analytics (03/28/2024)

The analyst wrote on Dune Analytics:

"Inscriptions on EVM are embedded data found within transaction call data, similar to Ordinals on Bitcoin. They aim to mimic the flexibility of ERC-20 and NFTs but on a smart contract blockchain."

However, Inscriptions appear to be incompatible and counter to the EVM design, encountering challenges not only in compatibility but also in pushing up network fees.

The increasing volume of Inscriptions coincided with a surge in Base network fees on the evening of March 27, peaking at $300 before dropping back to $30. Moreover, the high blob usage has caused Ethereum disruptions in block verification.

Simultaneously, Ultrasound.money has measured an average of 3 ETH burned from blobs every 30 minutes, ranking blobs among the top 5 applications burning the most ETH.

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ETH burned from applications within the 1H frame captured on the evening of 03/27. Source: Ultrasound.money

The Dencun upgrade, implemented on March 13, equips Ethereum Layer-2 networks with the significant EIP-4844 proposal, introducing a new block structure named "blobs" to store transaction data, replacing the traditional calldata method and significantly reducing transaction costs on Layer-2 networks.

In a related context, Ordinals also seem to lack enthusiasm among Bitcoin Core developers, who consider them network spam without providing substantial value. Many predict that the Inscription trend on Ethereum may soon diminish for similar reasons.