Recently, due to the significant wealth effect of the ordi token, a large number of users have entered the Bitcoin network to trade BRC20 tokens, leading to significant congestion on the Bitcoin chain and an increase in Gas fees. What are BRC20 tokens and the Ordinals Protocol?
BRC20 is a new token format developed based on the native Ordinals Protocol on the Bitcoin network. The Ordinals Protocol is a scheme for numbering the smallest unit of the Bitcoin network, "satoshi," which is also an NFT protocol based on the Bitcoin network. "Satoshi" is the basic unit of the Bitcoin network, with 1 "satoshi" always equal to 1 billionth of a Bitcoin. Since information can be written into Bitcoin blocks, a numbered satoshi becomes a natural NFT. As long as information in any form, such as text, images, audio, or video, is written into the block, it becomes an artwork. This artwork is eternal and cannot be modified, as long as Bitcoin does not disappear. Compared to the vibrant ecosystem brought about by the ERC-721 protocol on Ethereum, the BTC ecosystem led by the Ordinals Protocol is still in its very early stages, meaning it is extremely early. At this stage, we will review the top projects currently on the Brc20 token.
（Data Sources：https://brc-20.io/）
ranks second with a market capitalization of $0.27 billion. PEPE,MEME,MOON,nals, and other tokens are basically meme-style tokens. For the development of the ecosystem, the popularity of the meme mode can bring about an illusion of early prosperity, but the adhesiveness of ecosystem users comes from practical and innovative projects. Fortunately, on Brc-20, early practical projects are in the early stages of development. On May 7th, the founder of the cross-chain interaction project Interlay, @alexeiZamyatin, proposed the BRC-21 standard, which aims to introduce completely decentralized cross-chain assets on the Bitcoin network and use them on the Lightning Network. Also, the Bit lightning protocol, proposed by the original Atoken team (@Bit_lightning1), plans to use the characteristics of the Lightning Network, such as low gas prices, fast transmission, and decentralization, to connect with the Ordinals protocol and use the Lightning Network on Brc-20 to solve the congestion and high gas prices caused by Brc-20 on the Bitcoin main network. Through acceptors, Brc-20 assets can be mapping to other public chains, and performing defi behavior, directly supports brc20 tokens for pledge and lending. According to its white paper, it will first support Ethereum and Arbitrum.
The current benefit myth of BRC-20 tokens may cause many users to have a great deviation in the perception of the real market and risks under FOMO. Among the current BTC-20 tokens, only ORDI, VMPX, NALS, and DRAC have a 24-hour trading volume exceeding $100. According to the analysis of the active data on the link, many analysts believe that the BTC-20 active player model may be around 10,000 people, and among them, there may be very few people who gain huge assets. In addition, the wrong BTC-20 outlet may focus on more things than the performance of the Bitcoin network. Although BRC-20 tokens continue to be debated, it also exposes some problems in the Bitcoin network. The flash network and Bitlightning protocol targeting Bitcoin performance may start to explode soon.