BRC-20 vs ERC-20: Understanding Token Standards for Blockchain and Cryptocurrencies
In the world of blockchain and cryptocurrencies, token standards play a vital role in enabling the creation and implementation of digital assets. Two prominent standards, BRC-20 and ERC-20, have emerged on different blockchains, each offering unique features and functionalities.
This article aims to provide a comprehensive understanding of BRC-20 and ERC-20 tokens, highlighting their definitions, differences, and showcasing notable cryptocurrencies built on these standards.
BRC-20 Tokens:
BRC-20, short for Bitcoin Rich Coin-20, is a token standard specifically designed for the Bitcoin blockchain. BRC-20 uses ordinal inscriptions to mint and transfer facilities.
It allows developers to create and deploy tokens on the Bitcoin network, expanding its capabilities beyond the native cryptocurrency, Bitcoin. BRC-20 tokens adhere to a set of rules and specifications that govern their behavior, including token issuance, transfers, and interactions with other smart contracts on the Bitcoin blockchain.
While BRC-20 is a newer concept compared to ERC-20, initiatives like RSK (Rootstock) have paved the way for tokenization on the Bitcoin blockchain, enabling the creation of smart contracts and tokens. The gas fees for BRC-20 are less compared to ERC-20.
BRC-20 token’s market cap has seen a spike of more than 500% since last week with the rise of meme coins like PEPE. The market cap of BRC-20 is $475,058,296 with 24,677 tokens according to BRC-20.io.
ERC-20 Tokens:
ERC-20, or Ethereum Request for Comment-20, is the most widely adopted token standard on the Ethereum blockchain. ERC-20 defines a set of rules and functions that facilitate the creation and implementation of tokens. These tokens are fungible, meaning each unit is identical and can be exchanged on a one-to-one basis with other tokens of the same type. ERC-20 tokens have played a pivotal role in the growth of the Ethereum ecosystem, supporting projects, initial coin offerings (ICOs), and decentralized applications (DApps).
Notable Cryptocurrencies Built on ERC-20:
- Tether (USDT):
- Tether is a popular stablecoin that is pegged to the value of the U.S. dollar. It is widely used as a digital representation of fiat currency for trading and transferring value within the crypto space.
- Chainlink (LINK):
- Chainlink is a decentralized oracle network that connects smart contracts with real-world data. It aims to bridge the gap between blockchain and external data sources, enabling the execution of smart contracts based on real-time information.
- UniSwap (UNI):
- UniSwap is a decentralized exchange protocol built on the Ethereum blockchain. It allows users to trade ERC-20 tokens directly from their wallets without relying on intermediaries, providing a more secure and transparent way to exchange digital assets.
- Aave (AAVE):
- Aave is a decentralized lending and borrowing platform that operates on the Ethereum blockchain. It enables users to lend their cryptocurrencies and earn interest or borrow assets by collateralizing their holdings, all through smart contracts.
- MakerDAO (MKR):
- MakerDAO is a decentralized autonomous organization (DAO) that governs the stablecoin DAI. The MKR token provides holders with voting rights and is used to manage the stability of the DAI stablecoin, which aims to maintain a 1:1 peg with the U.S. dollar.
Notable Cryptocurrencies Built on BRC-20:
1. ORDINALS (ORDI): It operates using the Bitcoin protocol, and it has the highest market cap of $238,463,400.
2. VMPX: It has a market cap of $20,669,735 and is one of the popular meme tokens.
3. PEPE: The most trending meme token since last month. It has a market cap of $8,329,704.
4. NALS : It has a market cap of $8,187,501 with a great potential to rise.
5. MEME: It is the second BRC-20 token created with a market cap of $6,042,110.
Conclusion:
BRC-20 and ERC-20 tokens have revolutionized the crypto space by providing standards for creating and managing digital assets on their respective blockchains.
