Reading Time: 2 minutes
- The crypto community is using the Bitcoin Ordinals project to create fungible tokens
- This is outside the project’s popular use as a way to create NFTs
- The discovery has received cold and warm reception from Bitcoin supporters
The crypto community has found a new use case for the Bitcoin Ordinals project which is predominantly associated with NFTs on the Bitcoin blockchain. Now, the project is being used to create fungible tokens, something that has attracted cold and warm reception from the Bitcoin community. The Bitcoin-based fungible tokens use the BRC-20 standard which is similar to the popular Ethereum’s ERC-20 token standards.
Over 23,900 BRC Tokens in a Day
Known in full as Bitcoin Request for Comment (BRC), the standard enables Ordinals’ users to create Bitcoin-powered ERC-20-style tokens. Although the standard is still in its experimental stages, it has rejuvenated the hype surrounding the Ordinals project.
An experiment into “brc-20’s” and fungibility on bitcoin with ordinals 1/x pic.twitter.com/9khKLbEPk6
— domo (@domodata) March 9, 2023
First publicized by an individual named Domo after learning about the possibility from a Twitter user, it has already led to the birth of over 23,900 BRC-20 tokens within a day. Domo’s announcement attracted other curious on-chain enthusiasts leading to the creation of Bitcoin-based popular meme coins such as Pepe and Doge.
Blockchain platform Dune Analytics has revealed that most people testing out the new feature are employing text-based commands. According to Dune, text-based commands occupy less memory hence low fees, since Bitcoin determines the fee payable by considering the file size being inscribed.
Not Yet Official
However, Domo’s experiment has seen those out to have fun doing so while technical minds have questioned why he would use Bitcoin for such an experiment while others have indicated that there are better ways of achieving the same results.
For transparency, I have inscribed/minted/deployed zero BRC-20 tokens and think this is somewhat wreckless but also respect that people want to degen. I just wouldn’t spend too much on this and would treat it more as fun.
— Leonidas.og (@LeonidasNFT) March 9, 2023
This is not the first time the Bitcoin community has been divided over the Ordinals project. When it launched in January, some welcomed it as a way to extend Bitcoin’s use cases while others considered it a deviation from Satoshi Nakamoto’s original vision.
Although Domo has warned that BRC is yet to be declared an official standard, it’s yet to be seen how far the crypto community will take the experiment.
The emergence of blockchain technology has made the financial industry more accessible and efficient than ever before. With the rise of DeFi, a new class of digital assets known as Fungible Tokens, or FTOs, have emerged. These tokens are created by using a specific data structure called an Ordinal.
Ordinals are unique identifiers that are used to represent a digital asset. These Ordinals are generated using a hashing algorithm, which makes them almost impossible to replicate or interfere with. Due to their transparency and security, Ordinals are becoming increasingly popular as a way of creating FTOs.
Unlike traditional assets, FTOs are divisible and interchangeable. They can be used to securely and quickly transfer value and assets between two or more parties. By utilizing an Ordinal, FTOs can be issued and traded without having to go through the same process of verifying ownership that is required for other digital assets.
By using Ordinals, users can assign a unique value to each FTO. This allows users to determine the exact worth of their FTO, as well as any fees that they may charge for transferring the asset. Furthermore, transactions on the blockchain utilizing FTOs are completely encrypted and secured. Thanks to this, users can remain anonymous while still having access to a secure, global market.
In summary, the use of Ordinals to create FTOs is a revolutionary concept in the world of DeFi. By utilizing Ordinals, FTOs are able to be divisible, interchangeable, and securely traded. Thanks to this, users can maintain their anonymity and access a secure, global market. With more and more DeFi projects utilizing FTOs, it is safe to say that this is a trend that is here to stay.