Amidst the Chaos of Various RC-20 Protocols, Where is the Future of Bitcoin?

TL；DR

The constantly hyped BRC-20 concept in the market has led to the emergence of various RC-20 token protocols like mushrooms after rain;

Presently, various RC-20 concepts issued on the market are based on the Ordinals protocol;

The rise of various XRC-20 tokens has caused a series of impacts on the Bitcoin network;

The XRC-20 may become an important component of the future decentralized economy.

Introduction

With the increasing popularity of BRC-20 tokens, their value has also skyrocketed.

The first BRC-20 token ORDI, with an initial price of $0.1, rose to a maximum of $68.77 and a market value of $1.35 billion. Therefore, the formulation of the BRC-20 standard has once again attracted people’s attention to comparing tokens.

The continuously hyped BRC-20 concept in the market has led to the emergence of various RC-20 token protocols like mushrooms after rain.

X + RC-20

At present, various RC-20 concepts released on the market are based on the Ordinals protocol.

There are ARC20, IERC20 (Ethereum), CBRC20, SOL20, DRC20, ASC20, ORC20, LRC20, TRC20, SRC20 (only supports Bitcoin addresses starting with 1), Ethereum (Ethereum runes), as well as many new RC20 protocols based on Ordinals in the public chain, and they will be added gradually in the future, too many to be fully counted.

There are so many BRC20 protocols based on Ordinals that you don’t need to understand them all, nor can you fully understand them. You only need to understand the underlying essence of these protocols in order to have a certain basic understanding of the entire .

Ultimately, they are essentially the same as the underlying BRC20, issuing tokens, NFTs, domain names, tickets, stamps, etc. by transferring 1 Cong and writing identification information in the transfer remarks box (the smallest unit of Bitcoin is 1 Satoshi, while other RC20 protocols also issue tokens through the smallest unit of L1 chain tokens), and identifying the identification information in each unit through an indexer.

The difference between them and BRC20 is that they have made some modifications based on the foundation, such as simplifying information and reducing byte data, token naming length, enhancing the efficiency of the indexer, and increasing protocol security. Just like some public chains are designed to enhance TPS, some are designed for greater security, and some are designed to increase the flexibility of contract encoding.

热Popular RC-20 Protocols

ORC-20

ORC-20, like BRC-20, is a token standard running on the Bitcoin blockchain. It is encoded as a JSON (Java Object Representation) file and recorded on Satoshi as a serial number. ORC-20 is an upgraded version of the BRC-20 standard that addresses some of its shortcomings.

ORC-20 was launched by OrcDAO with the aim of enhancing the functionality of Ordinals tokens on the Bitcoin network to improve the current BRC-20. ORC20 has lifted token naming restrictions and added upgraded features for tokens, allowing project parties to do more empowerment based on tokens. Meanwhile, advanced features such as setting royalties and setting whitelists have been added.

ORC-20 can be backward compatible with BRC-20 and improve adaptability, scalability, and security, eliminating the possibility of duplicate consumption. However, due to the incomplete development of ORC20’s infrastructure and the wealth effect still concentrated on BRC20, ORC20 currently receives limited attention.

SRC-20

Unlike BRC-20 and ORC-20 based on Ordinals theory, SRC-20 uses Bitcoin stamps to inscribe text. Bitcoin stamps are similar to ERC-1155 semi homogeneous tokens or digital collectibles, which are directly stored on the UTXO of Bitcoin - a record of Bitcoin that is not used when trading between two addresses, rather than being stored in witness data like Ordinals.

However, as there is currently no market that supports SRC20, the only trading method is through over-the-counter trading, and SRC-20 still requires significant support. Therefore, the project mainly attracted retail investors who missed the opportunity for the BRC-20 Ordi token. Due to limited entry of hot money, careful observation is still necessary.

Although Binance has conducted an investigation into SRC-20, it has not taken substantial financial measures like OKX did with BRC-20, and the market still leans towards BRC-20.

ARC-20

The Atomicals protocol is a protocol built on the Bitcoin network. On the Bitcoin network, through the Atomicals protocol, digital items (NFTs, such as native digital NFTs, game NFTs, digital identities, domain names, social networks, etc.) can be created, transferred, and upgraded, as well as interchangeable tokens.

That is to say, through the Atomicalas protocol, non interchangeable NFTs and interchangeable tokens can be generated in the Bitcoin network. This interchangeable token is the ARC20 token.

The Atomicals protocol fully utilizes the characteristics of Bitcoin UTXO, using Satoshi as the accounting unit, which means that any digital item created based on the Atomicals protocol can trace its transaction history and achieve authenticity and verifiability. Users, wallets, project parties, and any other individual or institution can verify transaction history and detect authenticity through simple rules.

IERC-20 is an Ethereum based Inion Token Protocol responsible for standardizing Inion Tokens. It can provide a low-cost token eco for Ethereum users without affecting existing infrastructure, allowing anyone to deploy, mint, and trade tokens on the IERC-20. EthinscXYZ has introduced PoW’s fair Mining mode into the IERC-20 protocol and actively collaborates with other projects to launch inions.

IERC-20

IERC-20 is an Ethereum-based Inion Token Protocol responsible for standardizing Inion Tokens. It can provide a low-cost token eco for Ethereum users without affecting existing infrastructure, allowing anyone to deploy, mint, and trade tokens on the IERC-20. EthinscXYZ has introduced PoW’s fair Mining mode into the IERC-20 protocol and actively collaborates with other projects to launch inions.

The first token in the IERC20 eco is Ethi, also known as the flagship coin of IERC20. But it has already been minted.

The uniqueness of IERC20 lies not only in the development of Swap, but also in its integration of EVM cross chain functionality, building a channel between Ethereum inions and traditional Layer2, introducing more mainstream and stable coins, expanding the TVL of the inions eco, and providing more possibilities for the entire .

In addition, the project team plans to introduce PoW’s fair mining model into the IERC20 protocol and actively cooperate with other projects to launch inions, similar to the Atom protocol mining method, which to some extent leads the new model of the Ethereum eco Launchpad.

What Will Be the Future of Bitcoin

The rise of various XRC-20 tokens has caused a series of impacts on the Bitcoin network.
Mainly manifested in three aspects:

Firstly, it leads to congestion in the Bitcoin network, as the transaction data of these tokens needs to be stored on all Bitcoin blocks, increasing the transaction burden.

Secondly, the XRC-20 token has damaged Bitcoin’s reputation, forcing it to respond to negative news unrelated to the XRC-20 project.

Finally, the XRC-20 token lacks practical use and lacks compatibility with smart contracts compared to other token standards, limiting their practical application.

Although XRC-20 tokens have experienced rapid growth in a short period of time, it is currently unclear whether they are just a trend or a true game changer.

And although the XRC-20 faces many challenges, its surging traffic and attention it brings may attract more investors who have not previously ventured into the crypto field to join the Bitcoin community. This will also have a positive impact on the future of Bitcoin.

Conclusion

The XRC-20 token standard has the necessary features to promote emerging ecos, and in the future, it may allow these experimental tokens to interoperate with other blockchain s and digital assets, providing collateral for DeFi platforms or integrating them into dApps.

Nowadays, XRC-20 is exploring a possibility in the emerging field of Web3 and may also become an important component of the future decentralized economy. Gate.io will continue to closely monitor the development of the XRC-20 token in the coming months.