Many were excited when Yuga Labs announced its first NFT collection of ordinals last month, but the exact nature of its auction process has proven highly controversial. Casey Rodarmor the creator of Ordinals called the NFT giant’s sale “depraved” because it put its participants’ bitcoin holdings at risk.
In a Twitter thread on Sunday, Yuga Labs revealed details about how its upcoming "twelvefold" auction will work. Twelvefold includes 300 NFTs 288 of which are up for auction and the remaining 12 for “contributors, donations, and charitable activities.”
The company directed followers to visit the Twelvefold website to participate in the auction and bid which involved sending bitcoins to a unique bitcoin address owned by Yuga. The auction begins March 5th at 3pm PT and will run for a full 24 hours. However, just hours after the auction began, the bidding process drew scrutiny from certain community members who were concerned that the auction involved placing too much trust in Yuga.
For example, Twitter user @veryordinally said that Yuga is setting a “very bad precedent” for auctions in the still-nascent Bitcoin NFT space. Rodarmor later tweeted quoting Ordinally's response, saying he agreed, while adding some nasty criticism of Yuga. "Anyone who's been at Yuga Labs long enough will show their true colors," Rodamor said of Monday's auction. "They lack some combination of spine, intelligence, character, acuity, talent, empathy or experience." When Ordinals’ popularity soared in February, proponents argued that Ordinals NFTs had the advantage of being written directly to the Bitcoin blockchain. In contrast, Ethereum NFTs simply store files on the server and point to their corresponding directories.
However, bitcoin has long lacked the smart contract capabilities of ethereum, which allows for various forms of decentralized transactions including escrow services. Otherwise, it would be much more difficult to use Bitcoin to run the trustless escrow services necessary to facilitate auctions.
Some Twitter users believe that Bitcoin auctions should use Partially Signed Bitcoin Transactions (PSBTs) as an alternative. The technology allows multiple parties to sign transactions before they are broadcast to the network.
