The crypto world seems to have a recurring addiction – degens chasing the next shiny object, even if it means setting fire to what they claimed was revolutionary innovation along the way. I suppose when your goal is to get rich through the sale of vapourware wrapped in narratives, it doesn’t need to be consistent or make logical sense; it just needs to encourage naive users to click buy.
Token burning has been around for some time; it’s been part of the idea that you can manufacture deflation and magically invent “ultra-sound money” with a code update; while that story faded into obscurity, the latest trend in this pyromaniacal parade is Teleburning.
Apart from the name being a bad play on teleportation and token burning, ( but who am I to judge made-up jargon for a world I don’t participate in?) It describes the act of burning NFTs on their native chains and replicating them as inscriptions on the Bitcoin blockchain.
While some proponents hail it as a revolutionary migration, stuffing your old monkey JPEG into Bitcoin block space, a closer look reveals a bonfire crackling with questionable motives and unintended consequences.
Burning bridges before crossing?
Teleburning’s core argument is simple: NFTs on other chains are not getting the attention they once got, and due to regulatory concerns, security vulnerabilities, or perceived lack of prestige, it is time to pivot.
A new narrative is under construction, intending to generate new exit liquidity.
So, why not immortalise them on the granddaddy of them all – Bitcoin?
By burning the original NFT and inscribing a copy on Bitcoin, Teleburning promises permanence, security, and a perceived association with Bitcoin’s “digital gold” aura.
Teleburning has a process, but it requires a little mental gymnastics to make it seem real; this isn’t a peg-in system or a bridge. Teleburn addresses are derived using an inscription ID to generate a wallet with no corresponding private key, rendering them unrecoverable on the original chain.
Users would need to create an inscription of their NFT and then use that inscription ID to create an Ethereum Teleburn address, which is derived by taking the first 20 bytes of the SHA-256 hash of the inscription ID, serialised as 36 bytes, with the first 32 bytes containing the transaction ID and the last four bytes containing the big-endian inscription index, and interpreting it as an Ethereum address.
Only Ethereum Teleburn addresses are currently supported but could be replicated for other chains, with pull requests already in the works for chains like Solana, MATIC and Tezos.
It reminds me of the movie The Prestige, where the teleporter keeps making copies of Robert Angier, but someone still needs to drown one of them.
The migration mile markers thus far
Despite the strange migration method, it has not stopped certain NFT holders from taking up block space with these transactions. Last February, Jason Williams burned his $169,000 Bored Ape Yacht Club #1626 on Ethereum and Inscribed it forever onto Bitcoin Ordinals. Other highlights have been Milady Makers and ENS Addresses.
Now that you know how Teleburning works and that people are actively doing this, let’s consider the downsides before you toss your altcoin NFTs onto the digital pyre.
Double Jeopardy for the environment
Last time I checked, I thought Bitcoin was boiling the oceans, and we should change the code, while other progressive altcoins with low emissions are the future. So why would you need to empty a whole swimming pool’s worth of water to migrate your NFT?
It sounds like you’re part of the problem.
Security charade
Teleburning doesn’t magically imbue a copied NFT with Bitcoin’s security; Bitcoin doesn’t even know it exists, there are no consensus rules governing these assets, and you now rely on a host of third parties to verify its existence.
Inscriptions themselves raise significant security concerns, with vulnerabilities already being exploited. Trading your original NFT’s native security for a potentially even riskier environment seems like a dubious trade-off.
Lost utility and ecosystem
Ethereum and other smart contract chains have dedicated millions of resources to create marketplaces, applications, and exchanges you can use to buy, sell, swap, or use your ERC-721 tokens or something similar.
The ecosystem exists on that chain, along with the liquidity, burning an NFT severs its connection to its native ecosystem and potential utility. Access to games, communities, or specialised features built on the original chain all go up in smoke, potentially leaving you with a glorified JPEG trapped in the Bitcoin wilderness.
The prestige trap
Associating your NFT with Bitcoin via inscription is akin to wearing a rented crown suit. The prestige is borrowed, not inherent. Your Teleburned NFT doesn’t magically gain the same value or liquidity by claiming it is a native Bitcoin asset.
The tech gets no respect
I am old enough to remember when shitcoiners hated Bitcoin, this boomer coin was going nowhere, and it was all about the technology, the throughput, the features, the utility and the developers.
Forget about the growth in wallets, nation-state adoption and increase in market cap and trade settlement; no, that’s nothing to consider; what you need to look at is a boatload of innovative products with no market demand constantly spat out by venture-backed altcoins that’s where the real alpha is.
And to an extent, those people are right; VCs are mopping the floor with retail and generating huge returns, but for the average crypto Twitter trader armed with a Metamask wallet and a dream, it’s been a sad state of affairs.
If all these smart contracts and apps were so valuable, the market would surely ditch Bitcoin and move to these other chains, but that never happened. Now that these same ‘innovations’ are porting over to Bitcoin be it in a way worse implementation, does that not illustrate that the tech was never the appeal?
It’s time for altcoins to accept; they came for the tech, got rekt, and now it’s time to show Bitcoin respect.
The number of available Sats comes into question
NFT minting, new token issuance, and Teleburning are all easy to reproduce and have no limit to how many can be created. As long as new entrants believe they can be part of the gold rush, inscriptions can occur.
The more junk requiring serial numbers, the closer we get to a technical limiting factor: the amount of Bitcoin that can be used for these activities; since satoshis need to be serialised through ordinals to represent all this nonsense, how long before the sats run dry?
The Sats-to-Nonsense Ratio depends on how much Bitcoin these users can acquire; if holders aren’t selling and regulated entities don’t touch this stuff, it limits how much Bitcoin can be used for inscriptions.
It’s too early to say definitively how long it will take for sats to become limiting for Ordinals. Several factors will play a role, including the rate of adoption, the average size of inscriptions, and how much of this activity moves over from other chains.
Beyond the burning trend
Teleburning plays on FOMO (fear of missing out), pushing a narrative of superior value and permanence for NFTs inscribed on the Bitcoin chain. However, this narrative neglects the complexities and realities of both NFT ecosystems and the technology of inscriptions.
Teleburning is a solution in search of a problem.
While it offers a flashy narrative, the technical and environmental implications, paired with the potential loss of utility, cast a long shadow over the point of doing this.
Do your own research.
If you want to learn more about Teleburning, use this article as a jumping-off point and don’t trust what we say as the final say. Take the time to research, check out their official resources below or review other articles and videos tackling the topic.
