- The creation of the Ordinals protocol in January enabled the formation of NFTs on the Bitcoin blockchain, allowing the creation and transfer of digital assets such as images, videos, or audio recordings.
- Developers can now write and record text on the Bitcoin blockchain thanks to the Ordinals protocol. This text can be used to create tokens, which unlike NFTs, can be bought and sold. These tokens have become the most sought-after assets recently.
- BRC-20 tokens, experimental tokens that allow transferable tokens to be sent on the Bitcoin blockchain, have no connection with Ethereum’s ERC-20 tokens despite the similar names. Currently, there are 9122 BRC-20 tokens on the Bitcoin network.
With the advent of the Ordinals protocol, the Bitcoin blockchain has seen the creation of NFTs and tokens, with the latter becoming highly sought after. BRC-20 tokens, despite their similarity in name, have no relation to Ethereum’s ERC-20 tokens.
Understanding BRC-20 Tokens
BRC-20 tokens, short for “Bitcoin Request for Comment”, are experimental tokens that facilitate the transfer of tokens on the Bitcoin blockchain. Despite their name resemblance, these tokens have no connection with Ethereum’s ERC-20 tokens. Currently, the Bitcoin network hosts 9122 BRC-20 tokens with a total market value of $350 million. However, due to the simplicity of the Bitcoin blockchain compared to Ethereum’s, advanced smart contract technology is not yet available on the Bitcoin blockchain. Therefore, BRC-20 tokens are not currently used in decentralized exchanges or lending protocols.
Explosive Growth of BRC-20 Tokens
The number and total market value of BRC-20 tokens, created in March, have seen a significant leap within a 10-day period. Just 10 days ago, there were approximately 3400 BRC-20 tokens, but today the number is nearing 12,000. Similarly, the total market value has jumped from $17.5 million on April 26 to nearly $350 million today. Among the BRC-20 tokens, many “meme coins” like PEPE, MEME, SHIB, and WZRD have gained attention, with ORDI being the most well-known. ORDI’s market value has also increased twentyfold in 10 days, from about $8.5 million on April 26 to nearly $200 million today.
Creating a BRC-20 Token
These tokens, which can be created on the blockchain with text entries, can be created in a very simple way, as shown in the example below. With just 5 short lines of text, these tokens can be created. Each line represents a different aspect of the token, such as the standard it follows (BRC-20), the operation to be performed, the token’s abbreviation (ORDI), the maximum supply, and the limit of ORDI that can be created in a transaction.
Conclusion
The creation of the Ordinals protocol has opened up new possibilities on the Bitcoin blockchain, including the creation and transfer of digital assets and the creation of tokens. BRC-20 tokens, in particular, have seen a significant increase in number and total market value in a short period, indicating their growing popularity among cryptocurrency enthusiasts.
