BRC20 tokens have come with a frenzy and have caused the Bitcoin network to be congested. At the time of writing, there are over 326,000 unconfirmed transactions on the Bitcoin network.
Traders do not seem to mind as they rush to trade these tokens, excited by the possibility of DeFi on the Bitcoin blockchain.
What is BRC-20?
BRC20 is a token standard. It is highly experimental because the Bitcoin blockchain does not have the capability of handling DeFi. BRC20 token creation and transfer do not use Smart Contracts like in Ethereum (ERC20). It uses ordinal inscriptions of JSON data to deploy, mind and transfer tokens (Ordinals Protocol).
ORDI was the first token to be deployed on the Bitcoin network and has already risen to a market cap of $262M.
Being meme coin season, degen developers wasted no time creating a $MEME, $PEPE, and a range of other meme coins on Bitcoin. These tokens serve no further function other than to buy and sell.
Create and Trade BRC20 Tokens
- To work with BRC-20 tokens, you will need a UniSat Wallet.
- You will also need BTC to use for gas and trading.
- In case you wanted to create your own BRC20 token, just head over to your (funded) UniSats wallet and click on ‘Inscribe’. Click on the ‘BRC20’ tab and select ‘Deploy”.
- Fill in the Ticker Name and Total Supply of your token. Enter the Limit per mint and click on “Next”.
- Verify the text that appears since it contains details of your new token.
- Click on ‘Submit and Pay Invoice”. Pay the necessary fees associated with the token creation process using your UniSats wallet. Gas fees may vary depending on the network usage.
Trade BRC-20 tokens
- To trade your token on the marketplace, first access the marketplace. You will need at least 20 UniSats Points to access the marketplace. Every time you do a transaction on the Bitcoin network, you gain 1 UniSats Point. Mint tokens in order to complete the required 20 transactions. The token mints are free and you only pay the gas fees. Note that this is a Bitcoin network – it is slow and gas fees are high. At the time of writing, minting the 20 transactions will cost you over $400.
- After you have accessed the marketplace, select or search for your token Ticker. Then click on “Buy”. Click on ‘Confirm’ on the subsequent UniSats popup and pay the gas fee.
There are already over 14,300 BRC20 tokens created and the market has a total market cap of over $1 billion. There is no infrastructure to support these new tokens on the Bitcoin network. BTC is already hurting from the massive network congestion. If not resolved quickly, Bitcoin might just become unusable as users will have to wait weeks on end to have their transactions confirmed.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.
