In this article, you will understand what BRC-20 is, the top trending BRC-20 Token and its use cases.
Are you just hearing about BRC-20 Token for the first time?
BRC-20 is currently trending in the crypto space, leaving others who need help understanding what BRC-20 is all about.
The Best way to understand BRC-20 is to see it as ERC-20. ERC-20 are built on the Ethereum blockchain while BRC-20 is built on the Bitcoin blockchain.
Are you still confused?
Let’s dive deep.
What is BRC-20?
BRC-20 is an experimental token standard for fungible tokens created using the Bitcoin blockchain that lets users inscribe satoshis. Satoshi is the smallest Bitcoin unit.
This inscription is managed by Ordinals protocol. The inscription means assigning a unique number to a satoshi.
Example: A satoshi is 0.00000001 Bitcoin.
The BRC-20 token standard was created in March 2023 by Domo an on-chain analyst.
His aim was to make it possible for fungible tokens to be issued and transferred on the Bitcoin blockchain.
The most significant difference is that a BRC-20 doesn’t use a smart contract. As a result, it provides less functionality.
On the other hand, ERC-20 tokens can interact with other Dapps and protocols. For example, in DeFi, with lending and borrowing.
Ethereum wallet is required for ERC tokens while BRC-20 requires a bitcoin wallet.
With the Ordinals technique, you can turn a fungible token into an NFT. Or, in other words, into a non-fungible token.
The launch of BRC-20 tokens has caused the transaction fee of Bitcoin to skyrocket.
BRC-20 tokens are designed specifically for the Bitcoin blockchain and cannot be used directly on Ethereum or other blockchains.
However, it is possible to create bridges or cross-chain solutions that enable the transfer of value between different blockchains.
To mint or trade BRC-20 Tokens you need a Bitcoin wallet compatible with the BRC-20 standard.
Crypto Wallets That Support BRC-20
For Example, Metamask and Ledger support these tokens and Trust Wallet currently does not support BRC-20 yet.
BRC-20 Uses Cases
Currently, BRC-20 use cases are still limited.
- BRC-20 can be integrated into the DeFi ecosystem on Bitcoin.
- P2P trading platforms would maintain the transaction fees in BTC which is currently on the rise.
- Tokenization With this token standard you can tokenize real-world assets.
The BRC-20 token standard is still relatively new and its future outlook is uncertain. The recent rapid growth in market capitalization and transaction volume indicates a strong interest in BRC-20 tokens, particularly in the meme coin sector.
Top BRC-20 Memecoins
Here are the top 5 meme coins on the BRC-20 include;
PEPE token is the most popular token in the BRC-20 list, but more tokens are currently on the rise.
Did you know that the Bitcoin blockchain is one-of-a-kind because it can’t be used to make other tokens?
Ethereum, on the other hand, allows for the creation of all kinds of new tokens.
But don’t count Bitcoin out just yet!
With the recent introduction of BRC-20 and Ordinals, there’s a lot of exciting potential for what could be built on the Layer-1 blockchain in the future.