BRC-20 is a token standard created in March 2023 by an anonymous developer known as "Domo" (@domodata on Twitter).
While most crypto enthusiasts are familiar with Ethereum's ERC-20 or BNB Chain's BEP-20 tokens, the recent surge of meme coins like PEPE and PUNK has spotlighted the BRC-20 standard. These tokens are minted rapidly due to their shared BRC-20 framework, raising questions about their legitimacy and future potential.
In this guide, we’ll explore:
- What BRC-20 tokens are
- How they differ from ERC-20 tokens
- Where to buy/sell them
- Investment risks and opportunities
Overview of BRC-20 Tokens
At the time of writing, BRC-20 tokens have surpassed a $1 billion market cap. Key highlights:
- 14,079 BRC-20 tokens exist on the Bitcoin blockchain.
- They’re fungible tokens built using Bitcoin’s Ordinals protocol.
- Meme coin hype has driven up Bitcoin transaction fees.
What Is a BRC-20 Token?
BRC-20 is an experimental token standard inspired by Ethereum’s ERC-20. Unlike ERC-20 tokens, which rely on smart contracts, BRC-20 tokens use Bitcoin Ordinals and Inscriptions to embed data directly onto satoshis (the smallest Bitcoin units).
👉 Learn more about Bitcoin NFTs here
How BRC-20 Tokens Work
- Data Embedding: BRC-20 tokens leverage a Taproot upgrade (2021) loophole to store JSON-based token metadata on-chain.
- Minting: Users deploy, mint, and transfer tokens via Ordinals inscriptions.
- Limitations: No smart contract functionality—just basic transfers.
BRC-20 vs. ERC-20: Key Differences
| Feature | BRC-20 (Bitcoin) | ERC-20 (Ethereum) |
|------------------|------------------------|-------------------------|
| Smart Contracts | No | Yes |
| Interoperability | Limited | High (DeFi, dApps) |
| Transaction Speed | Slower (Bitcoin block time) | Faster |
Where to Buy/Sell BRC-20 Tokens
Supported Platforms:
- CEXs: UniSat, OKX (limited support)
- DEXs: Ordswap (low liquidity)
Steps:
- Use a Taproot-compatible Bitcoin wallet (e.g., Sparrow Wallet).
- Fund it with BTC for gas fees.
- Trade on supported exchanges.
Should You Invest in BRC-20 Tokens?
Pros:
- Early adoption potential.
- Bitcoin’s security backbone.
Cons:
- Experimental: No guaranteed utility.
- High volatility: Pump-and-dump risks.
- Network congestion: High fees during peaks.
"BRC-20 tokens may be a fleeting trend, not a long-term innovation." — BeInCrypto
FAQ
1. Are BRC-20 tokens just meme coins?
Most current BRC-20 tokens (e.g., ORDI, PEPE) are meme-driven, but the standard itself is neutral.
2. How do BRC-20 tokens impact Bitcoin?
- Increased transaction fees.
- ~50% of Bitcoin transactions recently were BRC-20 related.
3. Can I bridge BRC-20 tokens to Ethereum?
Not natively—cross-chain solutions would need development.
4. Who created BRC-20?
Anonymous developer "Domo" launched it in March 2023.
👉 Explore BRC-20 trading on OKX
Final Thought: While BRC-20 tokens open new possibilities for Bitcoin, their speculative nature demands caution. Always DYOR!
Disclaimer: This content is for educational purposes only. Cryptocurrencies are high-risk investments.