The BRC-20 token standard is a fungible token standard for the Bitcoin blockchain, enabling developers to create and transfer fungible tokens using the Ordinals protocol. However, unlike the Ethereum token standard (ERC-20), BRC-20 tokens do not make use of smart contracts, instead utilising Ordinals inscriptions of JSON data to deploy, mint, and transfer tokens.
Developed by Casey Rodarmor, the Ordinals protocol enables the creation of Bitcoin Ordinals NFTs with the aim of Ordinal theory to give each satoshi a unique identity, allowing them to be tracked, transferred, and imbued with individual meanings through inscriptions. This allows one satoshi to be different from another, hence becoming non-fungible.
The Ordinals protocol assigns each satoshi a sequential number in the order they are mined, and each can be inscribed with data — such as pictures, text, or videos — through a Bitcoin transaction. Since BRC-20 tokens exist on the Bitcoin blockchain, they inherit the high level of security provided by the Bitcoin protocol, which uses the Proof of Work (PoW) consensus mechanism and has a large number of miners helping to secure the network.
