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25 May, 8 tweets, 2 min read
On the origin of NFTs.

How and when did NFTs start? How are they evolving? Tweet thread👇
1/ Non-Fungible Tokens (NFTs) are crypto assets that are one of a kind.

The value of one unit of cash or Bitcoin is the same as another. NFTs are the opposite of that and are unique.

It might seem like NFTs are a recent thing--they're not. NFTs have been around for a decade.
2/ Decentralized domains were the original crypto NFTs.

A decentralized domain is unique, i.e., non-fungible. Namecoin pioneered decentralized domains in 2011, launching at Bitcoin block 19,200 with merged mining.

(I registered u/muneeb there in Feb 2014.)
3/ Non-fungible tokens have existed on Bitcoin and separate blockchains (like BitShares) since at least 2014.

Counterparty launched on Bitcoin in 2014. Rare Pepes, the first popular digital art NFTs launched in 2016 on Counterparty (Bitcoin).
4/ You'll often hear in the media that NFTs originated on Ethereum. That's demonstrably false.

Domain NFTs go back to 2011 (Namecoin, merged mined with Bitcoin), and popular digital art NFTs go back to 2016 (Rare Pepes, on top of Bitcoin).
5/ You'll also hear that NFTs are not possible on Bitcoin. That's also false.

NFTs are currently gaining traction in ecosystems like Ethereum and Flow.

However, scalable NFTs are launching on Bitcoin. Boom wallet and the NFT drop by Cara Delevingne are examples.
6/ In summary, NFTs emerged on Bitcoin (Counterparty and merged mining).

The next-gen NFTs on Bitcoin are more scalable as they settle on BTC (e.g., using Stacks) instead of storing all data on-chain (like Counterparty).

It’s worth knowing the original history!
P.S: Relevant article on Bitcoin NFTs.

“These NFTs are ... minted on Bitcoin and not Ethereum.”

The Hollywood Reporter on the latest @Caradelevingne NFT drop: hollywoodreporter.com/business/digit…

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More from @muneeb

Muneeb Profile picture
18 May
Bitcoin is often misunderstood within the crypto industry. Here is how:

Tweet thread👇
1/ People don’t think beyond the Bitcoin base layer.

L2s in Ethereum or subnets in Avalanche bring additional features to base layers. 

Similarly, Bitcoin layers, like Lightning for payments or RSK/Stacks for smart contracts, bring additional functionality to Bitcoin.
2/ Bitcoin is for settlements, not payments.

The additional layers, like Lightning or Stacks, is where payments happen. On Lightning, people use sats, and on Stacks, people can use stablecoins like xUSD or Bitcoin-based assets like xBTC.
Read 7 tweets
Muneeb Profile picture
6 May
How does the recent interest in Ethereum impact the crypto industry?

Tweet thread👇
1/ Bitcoin found product-market fit as digital gold (store of value) with no real competition in that category for years.

Ethereum's upcoming change in token economics with reduced supply has increased interest in the asset.
2/ Ethereum aims to be both (a) gas for smart contracts and (b) "ultra sound" money, i.e., compete with Bitcoin as a store of value.

Challenging Bitcoin's position as a store of value and the #1 crypto asset will undoubtedly result in tribal arguments.
Read 12 tweets
Muneeb Profile picture
5 Apr
The ultimate Bitcoin lending app will be 100% trustless. Your BTC will never leave the main Bitcoin chain.

How can this work? Tweet thread👇
1/ Bitcoin lending is already a multi-billion dollar market. You can currently divide the market into (a) wrapped assets and (b) custodial lending.

Wrapped assets themselves can be custodial with more decentralized versions like Keep in the works.
2/ For wrapped assets, like WBTC, a synthetic asset is issued by a custodian on a separate tech stack.

Three issues:
a) Potential tax hit on BTC to WBTC conversion and back. 
b) Risk of companies in the middle.
c) Risk of blockchains other than Bitcoin.
Read 10 tweets
Muneeb Profile picture
24 Mar
A lot of new people are discovering the crypto industry in 2021.

What basic mental models do you need to get right when learning about crypto?

Tweet thread👇
1/ The first thing to realize is that "cryptocurrencies" is the wrong term. Currency implies money. Other than Bitcoin, most assets are not money.

These are crypto-assets (not cryptocurrencies), and the critical question to ask is: what purpose does this new asset serve?
2/ The absolute worst way to enter crypto is to think, "Bitcoin appreciated, let me try to find the next Bitcoin." That's flawed at so many levels.

Bitcoin is a store-of-value, a type of hard money. Other assets are not even trying to be SoV (some are trying but failing).
Read 11 tweets
Muneeb Profile picture
19 Mar
The discussion below is the classic misunderstanding most people have about Ethereum and Bitcoin differences.

Tweet thread 👇
1/ Turing completeness is not a desirable property for smart contracts. What you mean/want here is expressiveness i.e, developers can easily write any logic.

You can be expressive with *decidable* languages. Being Turing complete i.e, not decidable is a security problem.
2/ There is nothing fundamental about Bitcoin that stops smart contracts.

Bitcoin designers, very carefully, built it so that the base layer has a small attack vector (i.e, limited script).

This leaves several options open to implementing smart contracts.
Read 11 tweets
Muneeb Profile picture
12 Mar
Miners have spent 96.1 BTC to secure the first 5000 Stacks blocks. The average mining profitability is 108.1%.

A thread on mining stats👇
1/ Instead of creating a separate proof of work or proof of stake network, Stacks uses a unique consensus mechanism that reuses Bitcoin’s hash-power.

Sharing compute power and network security with Bitcoin is critical for the long-term durability of smart contracts.
2/ Miners compete in leader election on the Bitcoin chain and bid in BTC. A Verifiable Random Function (VRF) selects the winner.

Winning miner writes the Stacks block, collects newly minted STX, and collects the gas fees for smart contracts.

Mining is open to anyone.
Read 9 tweets

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