Beginner’s Guide to BRC-20 Tokens – Part 1
The cryptocurrency world has seen the rise of Bitcoin ordinals and meme coins in recent times. However, developers have created a new token standard called BRC-20, which has gained a significant market cap of over $680 million in just two months. In this two-part series, we will delve into BRC-20 tokens, exploring what they are, their differences from ERC-20, their use cases, and more.
Headings:
What is the BRC-20 Token Standard?
BRC-20 vs ERC-20
BRC-20 Use Cases
BRC-20 List
BRC-20 vs Ordinals
Conclusion
What is the BRC-20 Token Standard?
BRC-20 is a new fungible token standard that allows users to inscribe satoshis, the smallest unit of Bitcoin. The Ordinals protocol assigns a unique number to a satoshi, turning it into a non-fungible and unique token. BRC-20 tokens are relatively new and experimental, and their developer Domo suggests that they may become worthless. At the time of writing, there were 14,307 BRC-20 tokens, and MetaMask and Ledger support them.
BRC-20 vs ERC-20
The most significant difference between BRC-20 and ERC-20 tokens is that BRC-20 does not use a smart contract, making it less functional than ERC-20. BRC-20 tokens exist on the Bitcoin blockchain, while ERC-20 tokens exist on Ethereum. BRC-20 tokens have limited use cases, but they are flexible and can integrate into DeFi protocols and tokenization of real-world assets.
BRC-20 Use Cases
Detailed Explained:- https://twitter.com/BanklessHQ/status/1656402157112008705?s=20
Currently, BRC-20 tokens are mainly used for meme coins. However, they have the potential to be integrated into DeFi protocols, creating a livelier ecosystem on the Bitcoin blockchain. They are also suitable for P2P transfers and tokenization of real-world assets.
BRC-20 List
The BRC-20 tokens available currently are mostly meme coins, with Pepe, Ordi, and Meme tokens being the top three by market cap. Token prices vary depending on supply, with low supplies generally having higher prices.
BRC-20 vs Ordinals
BRC-20 tokens are a token standard, while Ordinals are a technique for inscribing satoshis, turning them into NFTs. While the development of BRC-20 tokens and Ordinals has brought new life to the Bitcoin chain, it has also caused congestion and increased transaction fees.
Conclusion
BRC-20 tokens are a new token standard with limited use cases currently, but they have the potential to be integrated into DeFi protocols and tokenization of real-world assets. In part two of this series, we will delve deeper into BRC-20 tokens, exploring their risks and potential rewards.
Takeaways:
BRC-20 tokens are a new fungible token standard that allows users to inscribe satoshis, turning them into non-fungible and unique tokens.
BRC-20 tokens differ from ERC-20 tokens in that they do not use smart contracts, exist on the Bitcoin blockchain, and have limited functionality.
BRC-20 tokens are primarily used for meme coins, but they have potential use cases in DeFi protocols and tokenization of real-world assets.
Ordinals are a technique for inscribing satoshis, turning them into NFTs.
BRC-20 tokens and Ordinals have brought new life to the Bitcoin chain but have caused congestion and increased transaction fees.
Soon I will Prepare 2nd Part of this Series.
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