Credit: Leonidas Santana
Features

What Are BRC-20 Tokens? Everything to Know About the Experimental Bitcoin Token Standard

BY Erika Lee •

May 31, 2023

If you think you’re seeing orange, that’s because you are. Twitter is abuzz with users showcasing orange-themed profile pictures to pay homage to $OXBT, a BRC-20 token rapidly gaining traction. If you’re unfamiliar with BRC-20, it’s an experimental token standard that enables fungible tokens to be minted and traded via the Ordinals protocol on the Bitcoin blockchain.

Contrary to expectations, Bitcoin NFTs have emerged as the frontrunners in the market and show no signs of fading away in the near future. Therefore, like anything else in Web3, education is key. In order to understand what $OXBT is, it is essential to first gain a comprehensive understanding of BRC-20 tokens.

What is a BRC-20 token?

Bitcoin Request for Comment 20 (BRC-20) tokens were created in March 2023 by Domo, an anonymous developer. BRC-20 tokens are similar to ERC-20 tokens, which are built on the Ethereum blockchain.

“This is just a fun experimental standard demonstrating that you can create off-chain balance states with inscriptions. It by no means should be considered THE standard for fungibility on Bitcoin with Ordinals, as I believe there are almost certainly better design choices and optimization improvements to be made,” Domo said in a statement on the official website.

“I do, however, encourage the Bitcoin community to tinker with standard designs and optimizations until a general consensus on best practices is met.”

The first BRC-20 token

At the time of writing, there are about 30,657 BRC-20 tokens minted and 24,968 currently minting. However, the one that started it all was $ORDI. It is the first BRC-20 token ever deployed and currently is at a market cap of 7482.30 BTC ($208 million) at the time of writing.

This also led to the creation and launch of other new BRC-20 tokens, including $MEME and $PUNK. The enthusiasm surrounding BRC-20 tokens started to pick up, resulting in a record-breaking 30,000 Ordinal inscriptions in one day.

How to set up a wallet

Before you can mint, make sure you have a wallet set up. Go to Unisat.io and download either the Chrome extension or the wallet app. Once you have the wallet open, choose the option to create a new wallet and create a password. After, UniSat will generate a 12-word recovery phrase (keep it safe).

Next, you will be prompted to select a network. Choose Taproot Network. By choosing this network, you can now engage with BRC-20 tokens using your UniSat wallet. You will now have an address starting with “bc1p.”

BRC-20
Credit: Unisat

How to mint and purchase

You can mint BRC-20 tokens by providing the name, symbol, and total supply of your token on the Unistat website. Set a transaction fee and click on the “Mint Tokens” button.

To purchase BRC-20 tokens, you will need to visit a BRC-20 exchange such as Alex. Once you have found an exchange that you want to use, you will need to create an account and deposit Bitcoin into your account. Then, place an order on the exchange.

What is $OXBT?

$OXBT is a token created by Bitgod21, a free mint that launched on May 25. The launch is significant because it onboarded over five thousand new users to Bitcoin. In less than a week since its inception, $OXBT has already achieved an impressive market cap of 1188.58 BTC ($32 million).

While nothing has been explicitly announced, holders are speculating different types of announcements down the line, including a possible airdrop, Ordinals mint, and partnership with Frankdegods. What they have said is that they are “working hard on ▇▇▇▇▇▇▇▇.”

Sats Names

Sats Names (.sat) are similar to domain names on the internet, allowing users to easily remember and type in website addresses. If you have an Ethereum Name Service (ENS) domain name, this is basically the Bitcoin equivalent. Sats names are stored on the Bitcoin blockchain, which means they are decentralized and cannot be censored.

To register a sats name, you must create a Bitcoin transaction that includes the name you want to register and the fee you are willing to pay. The first person to create a transaction for a particular name will own that name. You can then update the name by creating another transaction with the new name and fee.

Navigating the world of Bitcoin can often feel perplexing and overwhelming, especially when new developments continue to emerge in the space. Keep in mind that BRC-20 tokens are a new type of asset, and the market for them is still developing. As a result, the prices of BRC-20 tokens can be volatile.

Dive Deep

Features