PEPE is a coin that has been in the spotlight in the cryptocurrency markets lately, keeping the Bitcoin network busy, increasing transaction fees and creating new $ millionaires. With PEPE, a new concept has entered our lives. This concept is “BRC-20”. So what is the BRC-20… ? Like you, I decided to research this concept that you just learned…
If you're ready, let's start …
What is BRC-20 token … ?
It is the BRC-20 token, which stands for “Bitcoin Request for Comment”. It is powered entirely by the security of the Bitcoin (BTC) network and operates on the Bitcoin network. The BRC-20 token standard is designed to run smart contracts on the blockchain, similar to Ethereum's (ETH) ERC-20 standard.
It is a process that started with the implementation of the Ordinals Protocol on the Bitcoin network in January 2023. In the early stages of the protocol, Ordinals NFTs embroidered on Bitcoin's smallest unit, the "satoshi", began to gain popularity. In the past few weeks, BRC-20 tokens have started to spread rapidly.
Volume has increased 12 times in the last week, especially PEPE and ORDI
Top 5 BRC-20 tokens by market Cap According to data from brc-20.io
According to brc-20.io data, it increased from $ 80 million to $ 707 million. PEPE's market volume has increased from $10 million a week ago to $102 million now. At the time of writing, it was down to $27 million. Another BRC-20 token ORDI's market volume of $ 50 million increased rapidly in the same period, reaching $ 500 million.
UniSat stands out as the decentralized exchange where BRC-20 tokens are traded.
You can make your transactions with UniSat's own wallet. You can use it as a Chrome extension. You can reach it at UniSat ...
Another trading address is Ordinals Wallet …
Let's get into some boring technical details...
How to generate BRC-20 tokens… ?
Creating the BRC-20 token is a simple process for those with a little knowledge of JSON and Bitcoin transactions. For that, you can follow the steps below….
Create a BRC-20 contract: The BRC-20 token contract is a JSON file that defines the four-letter name, maximum supply, decimals, and mint limit. You can distribute your token by overwriting the JSON file on a satoshi using a wallet that supports ordinates and texts. This creates the first token set of your BRC-20 token and assigns it to your wallet address.
Issue more tokens: To mint more of your new BRC-20 token, you can write another JSON file on another satoshi using the same process. The JSON file will be slightly shorter as you don't need to specify the same information as in the initial deployment.
Transfer tokens: To transfer tokens of your BRC-20 token to another wallet address, the writing process is the same as above. This JSON file should contain the number of tokens you want to transfer, the name of the token contract you deployed in the first step, and the recipient's address. This should reduce the balance of your wallet address and increase the balance of the recipient's wallet address.
What are the Differences Between BRC-20 and ERC-20... ?
The most important difference; It is the arrangement of BRC-20 tokens on the Bitcoin blockchain secured by Proof-of-Work (PoW), and ERC-20 tokens on the Ethereum blockchain secured by Proof-of-Stake (PoS). Additionally, BRC-20 tokens have less features than ERC-20 tokens due to the lack of smart contract support in Bitcoin.
Despite the unexpected growth of BRC-20 transactions and mints, there are potential risks and flaws associated with this new trend. Memecoins are already risky and memecoins above this standard are seen as even more risky. The technical flaws of token tools and the meme-centric nature of these tokens make them highly volatile and speculative. Additionally, the unusual growth of BRC-20 transactions can overload the Bitcoin network and cause problems.
What are the various uses for BRC-20 tokens... ?
The BRC-20 token standard is a token standard that can be used for many projects on the Bitcoin blockchain. BRC-20 tokens can be used to build decentralized applications (dApps) on the blockchain and therefore provide a means to extend the functionality of the Bitcoin network.
These projects may include decentralized exchanges (DEX), payment systems, games and other applications. Therefore, the BRC-20 token standard can contribute to the growth and development of the ecosystem.
My Last Words; BRC-20 tokens are still experimental assets. Many things run the risk of going wrong. On April 24, BRC-20 wallet UniSat Wallet announced that scammers exploited the double-spend deficit to steal tokens. The company has since announced that it will issue refunds to users. The ease of minting new coins means that most of them will eventually become worthless. There are currently more than 10,000 BRC-20 tokens available. The naming conventions mean that millions more tokens will emerge.
Moreover; The serious hype experienced on tokens with the BRC-20 protocol, especially PEPE, has also created an overload in the Bitcoin network. While the number of transactions pending on the Bitcoin network reached 400,000 during the peak, the cryptocurrency exchange Binance had to stop Bitcoin withdrawals twice.
As I always say; Listen to everyone, decide for yourself...
Good luck ...