Does The BRC-20 Tokens Have Application Value Or Is It Just Hyperbole?
The Bitcoin network has been driven crazy by a new token standard called BRC-20. But amid the hype and excitement that the BRC-20 tokens have unleashed, there have been concerns that this new crypto-asset will drag Bitcoin deep in the mud.
If you’re unfamiliar with BRC-20 tokens, here’s a quick explanation: This is an experimental new token standard built on the Bitcoin blockchain network. Designed by an anonymous developer named Domo on Twitter, the BRC-20 is supposed to be a Bitcoin-based solution for creating and transferring new digital assets.
The BRC-20 is loosely modeled on Ethereum’s ERC-20 standard, but its architecture is slightly different, using a concept known as a “sequence number” built into Satoshi, the smallest unit of Bitcoin. Just as the ERC-20 allows users to create their cryptocurrency on Ethereum, the BRC-20 makes it possible for anyone to deploy their own token on the Bitcoin blockchain.
Although started as an experiment, BRC-20 has gone viral, with hundreds of new tokens being minted in the past few months. Their collective market cap exploded above $1 billion on May 9 but has more than halved to $433,160,599.
It’s a staggering increase that tells us how millions of people are embracing testing, but there are reasons to be wary of the arrival of the BRC-20. Its experimental and completely unregulated nature poses an acute danger to Satoshi Nakamoto’s vision of Bitcoin as “a completely new peer-to-peer electronic cash system, with no trusted third parties”.
Token is worthless
It is almost inevitable that the majority of BRC-20 coins will become “shitcoins”, the AKA cryptocurrency with no value. When users go to YouTube and search for BRC-20, they’ll find dozens of “influencers” getting excited about this or that token going to the moon, with graphs depicting the value of rapid growth. Most of these guys are making money by promoting worthless tokens that will burn a lot of people.
If BRC-20’s association with these performers doesn’t disappoint, consider that its creator, Domo, warned his Twitter followers that most tokens are worthless. The fact is, BRC-20 tokens have nothing to do with real Bitcoin other than they use the same network. The BRC-20 is a JSON script file that allows almost anyone to add metadata to Bitcoin’s blockchain, generate a new token in the process, and transfer it between users by sending Satoshi. But they don’t create anything of inherent value.
Domo also warns that the burners of some BRC-20 tokens are built to mint new assets in middleman wallets, meaning users will lose control of those coins when they are sold molded.
As such, most BRC-20 tokens are simply taking advantage of Bitcoin’s legitimacy as the world’s most famous and trusted cryptocurrency. By masquerading as something related to Bitcoin, they can attract gullible users who might assume that the BRC-20 token is just as trustworthy as BTC. However, that is not the case, as the BRC-20 token does not have the same level of security, decentralization, or recognition.
Is the BRC-20 worth the application?
BRC-20 is an alternative token engraved on Satoshi, and some investors treat it as an ornament made of digital gold bitcoin and keep it as a collectible. Therefore, the current BRC-20 token price is mainly supported by the crypto circle’s consensus culture and the MEME culture.
Intrinsic value refers to the discounted value of cash that can be generated over the life of a product or business, so the BRC-20 has no inherent value. But the psychological significance of the BRC-20 is determined by the owner’s subjective feelings, which is similar to the emotional value brought by other collectibles or pets. Furthermore, based on BRC-20 as an alternative token standard, its circulation is better than other non-fungible collectibles.
BRC-20 is currently only deployed on the Bitcoin network. In the future, BRC-20 tokens can be cross-linked with other chains using smart contracts to play a role in DeFi. The Map Protocol cross-chain protocol proposed the BRC-201 cross-chain standard on May 19, committing to realizing this vision. But this depends on the further development of BRC-20, and only some BRC-20 tokens that are initially issued with strong consensus can play a role in DeFi.
In addition to using the BRC-20 token to play a role in other ecosystems, some projects plan to develop based on the Conventional protocol, which tries to bring the BTC network into the LP model to provide liquidity to the BRC-20 ecosystem. But the feasibility and market acceptance of this idea remains to be seen.
One application scenario of the BRC-20 protocol is to provide a more equitable currency issuance mechanism. Anyone can participate in the token minting process, which is a rebellion against the existing method of the token sale, in which venture capitalists obtain chips at low prices. Anyone can quickly deploy tokens, an option to issue community consensus tokens.
Compared with traditional industries, Web3 culture is more open, inclusive, and dynamic. When Bitcoin was born, no one thought it was possible to add smart contracts. When ETH was in the ICO stage, few people caught sight of the prosperity of DeFi and NFT. The ultimate success of new things emerges step by step. Although the BRC-20 currently has no practical application value, it is still worth our attention.
Should you stay away from the BRC-20?
If you notice coins like SHIB and PEPE on the list, avoid getting too excited and thinking they are trading at a different price on this BRC-20 blockchain. They are fake SHIB and PEPE tokens, and BRC-20 token miners use their names to get them into the Bitcoin network.
Please note that the ORDI token with ID #1 is the first BRC-20 minted. And there are also a few other interesting names, including Piza – which takes its name from the Pizza meme.
Besides the advantages (which may not be the advantages) like opening a new use case, creating and mining this token is easy as there is no complicated smart contract involved like ERC -20m, guaranteed security from the most secure network, Bitcoin and some other things, the risks it brings are worth paying attention to.
The proliferation of tokens by its loose regime or creating severe congestion for the Bitcoin network and deviating from the original direction must be mentioned. While regulations tighten, if the BRC-20 space explodes, it could start an officially unregistered securities space in the Bitcoin network.
According to market experts, the mistakes of the BRC-20 token space far outweigh the benefits. Moving away from BRC-20 and focusing on Bitcoin will protect you from unnecessary risk and contribute to the stability and growth of a real crypto-asset that will survive longer than anything trying to usurp its success.
When you hold Bitcoin, you are helping to make Satoshi Nakamoto’s vision a reality and create a more equitable financial future for the world. Hold some BRC-20 shitcoin, and you’re giving it to the scammer or joker who made it.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Foxy
Coincu News
Author
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Does The BRC-20 Tokens Have Application Value Or Is It Just Hyperbole?
The Bitcoin network has been driven crazy by a new token standard called BRC-20. But amid the hype and excitement that the BRC-20 tokens have unleashed, there have been concerns that this new crypto-asset will drag Bitcoin deep in the mud.
If you’re unfamiliar with BRC-20 tokens, here’s a quick explanation: This is an experimental new token standard built on the Bitcoin blockchain network. Designed by an anonymous developer named Domo on Twitter, the BRC-20 is supposed to be a Bitcoin-based solution for creating and transferring new digital assets.
The BRC-20 is loosely modeled on Ethereum’s ERC-20 standard, but its architecture is slightly different, using a concept known as a “sequence number” built into Satoshi, the smallest unit of Bitcoin. Just as the ERC-20 allows users to create their cryptocurrency on Ethereum, the BRC-20 makes it possible for anyone to deploy their own token on the Bitcoin blockchain.
Although started as an experiment, BRC-20 has gone viral, with hundreds of new tokens being minted in the past few months. Their collective market cap exploded above $1 billion on May 9 but has more than halved to $433,160,599.
It’s a staggering increase that tells us how millions of people are embracing testing, but there are reasons to be wary of the arrival of the BRC-20. Its experimental and completely unregulated nature poses an acute danger to Satoshi Nakamoto’s vision of Bitcoin as “a completely new peer-to-peer electronic cash system, with no trusted third parties”.
Token is worthless
It is almost inevitable that the majority of BRC-20 coins will become “shitcoins”, the AKA cryptocurrency with no value. When users go to YouTube and search for BRC-20, they’ll find dozens of “influencers” getting excited about this or that token going to the moon, with graphs depicting the value of rapid growth. Most of these guys are making money by promoting worthless tokens that will burn a lot of people.
If BRC-20’s association with these performers doesn’t disappoint, consider that its creator, Domo, warned his Twitter followers that most tokens are worthless. The fact is, BRC-20 tokens have nothing to do with real Bitcoin other than they use the same network. The BRC-20 is a JSON script file that allows almost anyone to add metadata to Bitcoin’s blockchain, generate a new token in the process, and transfer it between users by sending Satoshi. But they don’t create anything of inherent value.
Domo also warns that the burners of some BRC-20 tokens are built to mint new assets in middleman wallets, meaning users will lose control of those coins when they are sold molded.
As such, most BRC-20 tokens are simply taking advantage of Bitcoin’s legitimacy as the world’s most famous and trusted cryptocurrency. By masquerading as something related to Bitcoin, they can attract gullible users who might assume that the BRC-20 token is just as trustworthy as BTC. However, that is not the case, as the BRC-20 token does not have the same level of security, decentralization, or recognition.
Is the BRC-20 worth the application?
BRC-20 is an alternative token engraved on Satoshi, and some investors treat it as an ornament made of digital gold bitcoin and keep it as a collectible. Therefore, the current BRC-20 token price is mainly supported by the crypto circle’s consensus culture and the MEME culture.
Intrinsic value refers to the discounted value of cash that can be generated over the life of a product or business, so the BRC-20 has no inherent value. But the psychological significance of the BRC-20 is determined by the owner’s subjective feelings, which is similar to the emotional value brought by other collectibles or pets. Furthermore, based on BRC-20 as an alternative token standard, its circulation is better than other non-fungible collectibles.
BRC-20 is currently only deployed on the Bitcoin network. In the future, BRC-20 tokens can be cross-linked with other chains using smart contracts to play a role in DeFi. The Map Protocol cross-chain protocol proposed the BRC-201 cross-chain standard on May 19, committing to realizing this vision. But this depends on the further development of BRC-20, and only some BRC-20 tokens that are initially issued with strong consensus can play a role in DeFi.
In addition to using the BRC-20 token to play a role in other ecosystems, some projects plan to develop based on the Conventional protocol, which tries to bring the BTC network into the LP model to provide liquidity to the BRC-20 ecosystem. But the feasibility and market acceptance of this idea remains to be seen.
One application scenario of the BRC-20 protocol is to provide a more equitable currency issuance mechanism. Anyone can participate in the token minting process, which is a rebellion against the existing method of the token sale, in which venture capitalists obtain chips at low prices. Anyone can quickly deploy tokens, an option to issue community consensus tokens.
Compared with traditional industries, Web3 culture is more open, inclusive, and dynamic. When Bitcoin was born, no one thought it was possible to add smart contracts. When ETH was in the ICO stage, few people caught sight of the prosperity of DeFi and NFT. The ultimate success of new things emerges step by step. Although the BRC-20 currently has no practical application value, it is still worth our attention.
Should you stay away from the BRC-20?
If you notice coins like SHIB and PEPE on the list, avoid getting too excited and thinking they are trading at a different price on this BRC-20 blockchain. They are fake SHIB and PEPE tokens, and BRC-20 token miners use their names to get them into the Bitcoin network.
Please note that the ORDI token with ID #1 is the first BRC-20 minted. And there are also a few other interesting names, including Piza – which takes its name from the Pizza meme.
Besides the advantages (which may not be the advantages) like opening a new use case, creating and mining this token is easy as there is no complicated smart contract involved like ERC -20m, guaranteed security from the most secure network, Bitcoin and some other things, the risks it brings are worth paying attention to.
The proliferation of tokens by its loose regime or creating severe congestion for the Bitcoin network and deviating from the original direction must be mentioned. While regulations tighten, if the BRC-20 space explodes, it could start an officially unregistered securities space in the Bitcoin network.
According to market experts, the mistakes of the BRC-20 token space far outweigh the benefits. Moving away from BRC-20 and focusing on Bitcoin will protect you from unnecessary risk and contribute to the stability and growth of a real crypto-asset that will survive longer than anything trying to usurp its success.
When you hold Bitcoin, you are helping to make Satoshi Nakamoto’s vision a reality and create a more equitable financial future for the world. Hold some BRC-20 shitcoin, and you’re giving it to the scammer or joker who made it.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Foxy
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