Most Bitcoin Inscriptions belong to a single person or entity

TLDR

We have analyzed all Ordinal Inscriptions created since Bitcoin block 779832, which marks the introduction of the BRC-20 standard. It appears that 80% of all inscriptions created in early-mid May 2023 belong to a single person or entity that controls a single public key, 117f692257b2331233b5705ce9c682be8719ff1b2b64cbca290bd6faeb54423e. Between March 7, 2023 (the introduction of BRC-20), and May 25, 2023, this entity accounted for 64% of all inscriptions. Their transaction fees amount to 1056 BTC, single-handedly influencing the regime of the entire blockchain.

Correction: This tweet clarifies that while all these inscriptions are produced by Unisat.io using Unisat's single private key, they are actually owned by various Unisat users.

Details 

We are developing a high-performance Bitcoin blockchain analyzer that we plan to open source. Our aim is to provide regular Bitcoin users with tools to research their transactions and see what kind of information proprietary chain analytics companies sell to their high-profile clients. This is our first post.

During our test runs, which parsed and printed tapscripts in the P2TR script-path transaction inputs, we noticed that a script featuring the same single public key dominated all tapscripts. The script matched this pattern:  OP_PUSHBYTES_32 117f692257b2331233b5705ce9c682be8719ff1b2b64cbca290bd6faeb54423e OP_CHECKSIG OP_PUSHBYTES_6 <6 bytes> OP_DROP OP_0 OP_IF OP_PUSHBYTES_3 6f7264 OP_PUSHBYTES_1 01 OP_PUSHBYTES_M <M bytes> OP_0 OP_PUSHBYTES_N <N bytes> OP_ENDIF. 

You can view this script in the input 0 of transaction 142614adfb5855703f76a7de1aa7598f1154fc905f66d5b238ef2ced88e7bdec.

We found 8,812,568 occurrences of this pattern in all tapscripts in the block range 779832 (March 7, 2023) to 791373 (May 25, 2023). We recognized this as a modification of the standard ord wallet Inscriptions script. 

However, the script does not appear to be produced by the standard ord wallet, as it contains extra ops: OP_PUSHBYTES_6 <6 bytes> OP_DROP. Since the mined transactions contain valid signatures for this single pubKey, we conclude that all these Inscriptions are controlled by a single private key belonging to an entity that signed all these transactions.

We then counted all occurrences of the standard ord wallet Inscriptions pattern , OP_PUSHBYTES_32 <32 bytes> OP_CHECKSIG OP_0 OP_IF OP_PUSHBYTES_3 6f7264 OP_PUSHBYTES_1 01, plus this non-standard inscription pattern with extra OP_PUSHBYTES_6 <6 bytes> OP_DROP and other (i.e. not 117..23e) PubKeys, in the same block range. We found a total of only 5,634,659 occurrences of other Inscriptions. In other words, the entity's inscriptions with the PubKey 117f692257b2331233b5705ce9c682be8719ff1b2b64cbca290bd6faeb54423e dominate, accounting for 64% of all inscriptions.

To investigate time trends, we plotted the number of inscriptions by this entity versus the total inscriptions per block, revealing that its production was increasing

.Between the blocks 787700 (April 30, 2023) and 790500 (May 19, 2023), for example, the entity has produced about 80% of all inscriptions:

Using Casey Rodarmor's ordinals.com for a sample Inscription with this PubKey 117f692257b2331233b5705ce9c682be8719ff1b2b64cbca290bd6faeb54423e, we find that the BRC20 "tick" for some (but not all) of these these tokens is GMGN. A search for GMGN leads to https://twitter.com/BitGod21/.

The total transaction fees spent by this entity to dominate the Inscriptions are estimated to be 1056 BTC as of May 25, 2023. We calculated this as the difference between the referenced transaction's spent output values and the inscription transaction's outputs, for all transactions containing 117…23e pubKey.

We leave the conclusions to the reader. However, we notice that by spending only 0.005% of the total Bitcoin supply on transaction fees, a single entity can significantly impact the entire Blockchain regime. This illustrates that if a whale or a governmental actor, possessing hundreds of thousands of Bitcoins, decides to spam the blockchain, they could impede its usability for normal payments. This vulnerability may partly be due to the discount for witness vBytes in SegWit, along with relaxed witness size restrictions in the P2TR (Pay to Taproot) transactions scheme, although further research on the transaction fees market is needed.

For the raw data and details please see:

https://github.com/block21m/analyzer-insights/