BRC-20 & ERC-20
BRC-20 Token Specification
BRC-20 tokens are a type of digital asset designed to explore fungibility on the Bitcoin blockchain through the use of off-chain balance states with inscriptions. BRC-20 tokens are not an established standard like ERC-20 tokens but rather an experimental concept that encourages the Bitcoin community to explore and optimize designs for fungible assets. While BRC-20 tokens may not be suitable for production use, they provide a platform for experimentation and the discovery of best practices within the Bitcoin ecosystem.
Key Characteristics of BRC-20 Tokens:
Off-Chain Balance States: BRC-20 tokens utilize off-chain balance states with inscriptions to represent token ownership and transfers. These inscriptions are associated with Bitcoin addresses and can be used to determine the token balance.
Minting and Transfers: BRC-20 tokens can be minted by using the mint function, which assigns a balance to the first owner of the mint function inscription. Transfers of BRC-20 tokens deduct from the sender's balance and add to the receiver's balance upon the first transfer of the transfer function.
Ticker Symbol: BRC-20 tokens are identified by a ticker symbol, a 4-letter identifier that uniquely represents the token within the BRC-20 ecosystem. Tickers are not case-sensitive.
Maximum Supply: Each BRC-20 token has a maximum supply defined during deployment, representing the total number of tokens that can ever exist.
Mint Limit (Optional): BRC-20 tokens can have a mint limit per ordinal, which restricts the amount that can be minted by a single ordinal. This feature enables control over token creation by individual ordinals.
Decimal Precision: BRC-20 tokens can specify a decimal precision, similar to ERC-20 tokens. The decimal precision determines the divisibility and granularity of token units.
Ordinal Compatibility: BRC-20 tokens are designed to be compatible with ordinal wallets that support the inscription of BRC-20 functions. Ordinal wallets generate unique addresses for each transaction and facilitate the transfer of token balances.
Inscription Services: To interact with BRC-20 tokens, users may utilize inscription services. However, caution is advised as some inscription services may handle token inscriptions differently, potentially affecting the token balances.
Experimental Nature: BRC-20 tokens are an experimental standard, and their design should not be considered the definitive solution for fungibility on Bitcoin. The Bitcoin community is encouraged to explore, improve, and optimize the design and rules of BRC-20 tokens until a general consensus on best practices is reached.
Limitations: BRC-20 tokens are subject to limitations imposed by the underlying Bitcoin blockchain, such as the maximum supply constraint and the use of uint128 and uint64_max data types for balances and maximum supply, respectively.
Please note that BRC-20 tokens are not as widely adopted as ERC-20 tokens and may not have the same level of infrastructure support and compatibility within the broader cryptocurrency ecosystem.
ERC-20 Token Specification
ERC-20 tokens are a type of digital asset built on the Ethereum blockchain. They adhere to a specific set of rules and standards defined by the ERC-20 token standard. ERC-20 tokens are widely used in the Ethereum ecosystem and have become the foundation for numerous tokenized projects, including cryptocurrencies, utility tokens, and security tokens.
ERC-20 tokens serve various purposes, such as facilitating decentralized fundraising through IDOs, presales, powering decentralized applications (dApps), enabling tokenized assets, and providing liquidity within decentralized exchanges (DEXs). Their programmability and compatibility with the Ethereum platform have made ERC-20 tokens a popular choice for token creation and distribution.
This section provides an introduction to ERC-20 tokens, delving into their purpose, characteristics, and the benefits they offer within the Ethereum ecosystem.
Token Standard Features and Functionality
ERC-20 tokens adhere to a set of standardized features and functionalities that ensure their interoperability and ease of integration with Ethereum-based applications. These features include:
Balance Tracking: ERC-20 tokens keep track of the balance of each token holder, allowing for seamless transfer and verification of token ownership.
Transferability: ERC-20 tokens can be easily transferred between different Ethereum addresses, providing a means of value exchange within the ecosystem.
Decimals and Precision: ERC-20 tokens can be configured with a specified number of decimal places, allowing for precise and divisible token units.
Total Supply: ERC-20 tokens have a total supply defined at their creation, which represents the maximum number of tokens that will ever exist.
Token Name and Symbol: ERC-20 tokens typically have a name and symbol that uniquely identify them within the Ethereum network.
Token Metadata: ERC-20 tokens can optionally include metadata such as token descriptions, images, and URLs, providing additional information about the token.
Understanding the features and functionality of ERC-20 tokens is crucial for token issuers, developers, and users, as it enables seamless integration with ERC-20 compatible wallets, exchanges, and dApps.
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