The BRC-20 standard, launched on March 8, 2023, by developer @Domodata, has rapidly gained traction within the Bitcoin community. But what exactly is it? BRC-20 is a fungible token standard designed specifically for the Bitcoin blockchain.
Understanding BRC-20 Tokens
BRC-20 leverages inscriptions to create ordinals using JavaScript Object Notation (JSON) for deploying token contracts, minting, and transferring tokens. These tokens can be attached to satoshis (the smallest unit of Bitcoin) and traded or exchanged like any other cryptocurrency.
By late 2023, BRC-20 tokens surged in popularity due to their unique ability to attach data to specific satoshis and store it permanently on the Bitcoin blockchain. This innovation enabled the creation of non-fungible tokens (NFTs) directly on Bitcoin, similar to Ethereum’s capabilities.
Key highlights:
- Market capitalization reached ~$1.5 billion by late 2023.
- Enables NFT-like functionality on Bitcoin.
- Uses Bitcoin’s Proof of Work (PoW) consensus (unlike Ethereum’s Proof of Stake).
BRC-20 vs. ERC-20
While BRC-20 mirrors Ethereum’s ERC-20 in some ways, critical differences exist:
| Feature | BRC-20 (Bitcoin) | ERC-20 (Ethereum) |
|------------------|----------------------------|----------------------------|
| Consensus | Proof of Work | Proof of Stake |
| Smart Contracts | Not supported | Supported |
| Use Cases | Memecoins, NFTs | DeFi, stablecoins, governance tokens |
👉 Explore top BRC-20 tokens like ORDI and PEPE
Benefits of BRC-20
- Fungibility: Tokens are interchangeable and tradable on exchanges.
- Security: Built on Bitcoin’s battle-tested PoW mechanism.
- Compatibility: Seamlessly integrates with Bitcoin’s ecosystem.
Challenges & Controversies
- Network Congestion: Critics argue BRC-20 clogs Bitcoin’s network, raising fees.
- Spam Concerns: Some view memecoins like PEPE as blockchain spam.
- No Smart Contracts: Limits functionality compared to ERC-20.
Top 6 BRC-20 Tokens
- ORDI: First BRC-20 token (21M supply).
- PEPE: Viral memecoin with 38,900% ROI for early adopters.
- VMPX: Fair-launch token by XEN’s founder.
- PIZA: Lighthearted memecoin.
- SATS: Tied to Bitcoin’s smallest unit (satoshis).
- MEME: Satirical token celebrating internet culture.
FAQs
Q: Can BRC-20 tokens be used in DeFi?
A: No—they lack smart contract support, limiting DeFi applications.
Q: Why are Bitcoin maximalists critical of BRC-20?
A: They believe it deviates from Bitcoin’s original purpose as “digital gold.”
Q: Is BRC-20 just a trend?
A: While booming in 2023, long-term adoption depends on developer innovation.
Future Outlook
BRC-20’s growth hinges on:
- Solving network congestion.
- Expanding beyond memecoins.
- Gaining developer trust.
Will it redefine Bitcoin’s utility or remain a niche experiment? The market’s response will tell.