Bitcoin Expands Its Functionality By Allowing Users to Mint and Trade Physical Gold on Its Blockchain

Bitcoin, often referred to as “digital gold,” is expanding its functionality by allowing users to mint and trade physical gold on its blockchain.

Bitcoin, fondly dubbed “digital gold,” is now expanding its capabilities to include the minting and trading of physical gold on its blockchain. This groundbreaking feature is being introduced through the Ordinals protocol, which essentially transforms ownership of real gold into a Non-Fungible Token (NFT) format.

Swarm Markets, a platform that specializes in tokenizing real-world assets and is licensed by BaFin in Germany, has joined forces with OrdinalsBot to enable investors to purchase gold bars using Bitcoin. This collaboration marks the introduction of gold as the first real-world asset (RWA) available on Trio, a new marketplace from OrdinalsBot that is set to launch later this year.

The Ordinals protocol functions by assigning unique data, such as images or text, to individual satoshis, which are the smallest units of Bitcoin. This adds a unique value to each satoshi, rendering them akin to Bitcoin’s version of NFTs. Swarm and OrdinalsBot have taken this a step further by attaching specific gold kilobar serial numbers to satoshis, which can then be traded through Bitcoin’s Ordinals protocol.

While both Bitcoin and gold are recognized for their value as assets with a limited supply, they tend to react differently during periods of economic downturn. For instance, gold experienced a surge of 10% to reach record highs during the third quarter of this year as a result of U.S. recession fears, while Bitcoin saw a more modest increase of 0.8%.

Swarm’s Ordinals platform now provides investors with the capability to hold both physical and digital gold on a single blockchain, which could potentially put an end to the long-standing debate over which form of gold to invest in. As Timo Lehes, co-founder of Swarm, stated in a press release to CoinDesk, “Investors no longer need to choose between real or digital gold, when Swarm’s Ordinals allow them to hold both using one blockchain as a unified infrastructure.”