🟧 BRC-20 Tokens BRC-20 Tokens
An experimental standard for making fungible (interchangeable) tokens directly on Bitcoin. Instead of smart contracts, you write a tiny text file onto a single satoshi. It was Bitcoin's first rough answer to Ethereum's ERC-20.
🟧 The simple version — sticky notes on coins
Picture writing a short note on a sticky label and gluing it permanently onto a specific coin. The note says things like "this token is called ORDI" or "send 100 of these to that person." That note is a tiny JSON text file, and the coin it's stuck to is a satoshi (the smallest unit of bitcoin). Putting a note on a satoshi is called an inscription, and it rides on the Ordinals protocol. BRC-20 is simply an agreed-upon format for what those notes say so that token tracking works.
🧾 The three things a BRC-20 note can say
| Operation | What it does |
|---|---|
| 🆕 deploy | Creates a brand-new token: sets its ticker (short name) and a maximum supply |
| 🏭 mint | Issues actual units of that token into existence |
| 📤 transfer | Moves units from one person to another |
📌 That's the whole toolkit. There is no fourth option for "run a program" — which is exactly why BRC-20 can't do the programmable DeFi tricks you see on Ethereum.
🧮 Who keeps the ledger? (not Bitcoin)
Here's the surprising part: Bitcoin stores the inscribed notes but doesn't understand them. So separate off-chain software called indexers scans every inscription, picks out the valid BRC-20 notes, and keeps the running tally of who owns how much. Your wallet then reads its balances from an indexer. Think of Bitcoin as a vault that safely stores receipts, while a hired accountant reads them all and does the math. This is also why BRC-20 is called experimental — it leans on trusted outside software rather than Bitcoin's own consensus.
📜 Where it came from
A pseudonymous developer known as Domo published BRC-20 on March 8, 2023. It was the first way to issue altcoin-style fungible tokens directly on Bitcoin. It quickly sparked a 2023–2024 boom in Bitcoin memecoins and trading volume. The most famous example is ORDI, the first major BRC-20 token, with a max supply of 21 million that mirrors Bitcoin's own cap; SATS is another well-known one. The boom had a side effect: all those inscriptions crowded the network and pushed up Bitcoin transaction fees.
🚨 Things beginners should know
- 🧪 It's an experiment — Even Domo, its creator, called the tokens essentially "worthless" and warned people not to mass-mint them
- 🚫 No smart contracts — BRC-20 can only deploy, mint, and transfer; it can't run lending, swaps, or any automated logic
- 🎭 Mostly memecoins — Most BRC-20 tokens have no product behind them, so prices can spike and crash hard
- 🧮 Relies on indexers — Balances depend on off-chain software reading the notes correctly, not on Bitcoin itself
❓ FAQ
- Is BRC-20 just ERC-20 for Bitcoin?
- No. They both create fungible tokens, but BRC-20 has no smart contracts. It can only deploy, mint, and transfer simple tokens — it can't run programmable logic like lending or swaps the way ERC-20 tokens can on Ethereum.
- Does Bitcoin itself keep track of BRC-20 balances?
- No. Bitcoin only stores the inscribed text. Separate off-chain software called indexers reads every inscription, validates the BRC-20 rules, and keeps the ledger of who owns what. Wallets read balances from those indexers.
- Are BRC-20 tokens safe to buy?
- Treat them with caution. The standard is officially an experiment, and its own creator called the tokens essentially worthless and warned against mass-minting. Most BRC-20 tokens are memecoins with no underlying product, so prices can swing wildly or collapse.