Implementing non-fungible tokens using bitcoin

A system for implementing Non-Fungible Tokens (NFTs) using Bitcoin, the system comprising a server configured to perform the following:

• creating a set of metadata describing a collection of NFTs;
• loading the metadata into a Content Addressable Storage;
• receiving a first cryptographic hash representing an address of the set of the metadata in the Content Addressable Storage;
• generating a GENESIS COLLECTION transaction that includes the first cryptographic hash and a first unspendable transaction output (UTXO), wherein the first UTXO is associated with metadata of the GENESIS COLLECTION, and
• wherein the GENESIS COLLECTION transaction is a Bitcoin transaction where a first output of the GENESIS COLLECTION transaction contains OP_RETURN opcode with metadata corresponding to GENESIS COLLECTION transaction type, a second output of the GENESIS COLLECTION transaction is a UTXO bounded with the OP_RETURN, and
• wherein the metadata that follows the OP_RETURN opcode includes the first cryptographic hash, the number of digital assets in the collection;
• sending the GENESIS COLLECTION transaction to a Bitcoin blockchain;
• generating a COLLECTION MINT transaction that includes multiple unspendable transaction outputs (UTXOs) created using the first UTXO;
• defining a digital asset to be associated with an NFT from the collection of NFTs;
• loading the digital asset into the Content Addressable Storage;
• receiving a second cryptographic hash representing an address of the digital asset in the Content Addressable Storage;
• using one of the multiple unspendable transaction outputs (UTXOs), generating a GENESIS NFT transaction that includes the second cryptographic hash;
• and
• sending the GENESIS NFT transaction to the Bitcoin blockchain.

A method of implementing Non-Fungible Tokens (NFTs) using Bitcoin, the method comprising:

• creating a set of metadata describing a collection of NFTs;
• loading the metadata into a Content Addressable Storage;
• receiving a first cryptographic hash representing an address of the set of the metadata in the Content Addressable Storage;
• generating a GENESIS COLLECTION transaction that includes the first cryptographic hash and a first UTXO, wherein the first UTXO is associated with metadata of the GENESIS COLLECTION;
• sending the GENESIS COLLECTION transaction to a Bitcoin blockchain;
• generating a COLLECTION MINT transaction that includes multiple UTXOs created using the first UTXO,
• wherein the COLLECTION MINT transaction is a Bitcoin transaction where a first output of the COLLECTION MINT transaction contains OP_RETURN opcode with metadata corresponding to COLLECTION MINT transaction type, and UTXOs bounded with the OP_RETURN, wherein a number of bounded UTXOs is defined by a collection issuer, and stated in the OP_RETURN metadata, and does not exceed a collection size defined in GENESIS COLLECTION metadata;
• defining a digital asset to be associated with an NFT from the collection of NFTs;
• loading the digital asset into the Content Addressable Storage;
• receiving a second cryptographic hash representing an address of the digital asset in the Content Addressable Storage;
• using one of the multiple UTXOs, generating a GENESIS NFT transaction that includes the second cryptographic hash and corresponding UTXO, and sending the GENESIS NFT transaction to the Bitcoin blockchain;
• using the UTXO from the GENESIS NFT transaction to change owner of the NFT for the first time by generating a NFT SEND transaction with a corresponding UTXO, and sending the NFT SEND transaction to the Bitcoin blockchain;
• and
• using the UTXO from the NFT SEND transaction to change the owner of the NFT by generating an NFT SEND transaction with a corresponding UTXO, and sending the NFT SEND transaction to the Bitcoin blockchain.