How This Game-Changing Technology Is Revolutionizing Bitcoin Transactions
The world of cryptocurrencies is constantly evolving, and with the BRC-20, investors are witnessing a significant shift in the Bitcoin (BTC) ecosystem. According to for researcher Tom Wan, BRC-20 has propelled Ordinals to the next level of adoption, and this has resulted in an increase in BRC-20 related transactions.
In recent times, BRC-20 transactions related to deploying, minting and transferring tokens have overtaken non-ordinary transactions. On May 7th, the percentage of BRC-20 transactions reached a high of 65%, indicating the growing adoption of this protocol.
Unlocking the Power of Bitcoin
BRC-20 tokens are a cryptocurrency that runs on the Bitcoin blockchain and is used for smart contract applications. Unlike regular Bitcoin transactions, BRC-20 transactions require the user to enter a new ordinal, which creates a longer queue in the Bitcoin mempool. However, the memory usage of the mempool is currently lower than it was in March because the size of BRC-20 tokens is approximately 10 times smaller than image subscriptions.
Despite lower mempool usage, the average transaction fee still increased to $18.9, the highest since May 2021. This is due to the long queue in the mempool, which requires users to pay a higher gas fee in order for your transactions are settled by the miners.
According to Tom Wan, one of the main benefits of adopting the BRC-20 is the increased revenue it brings to miners. Tariffs from Ordinary transactions reached 61%, 99.5% from BRC-20. This is a significant increase compared to previous levels, which indicates that the BRC-20 is gaining more and more traction in the Bitcoin ecosystem.
Furthermore, according to Tom Wan, Bitcoin transaction fees have reached their highest point in six years. On May 7th, the percentage of transaction fees reached 31%, which is a significant increase from the 1-2% range seen since July 2021. This increase in fees resulted in Block 788695 registering the 5th highest transaction fee USD transaction with $194k and 6.7 BTC.
While this increase in fees may be concerning for some Bitcoin users, it is important to note that the fees are still relatively low when measured in terms of BTC. For example, Block 409008 recorded the highest BTC transaction fee with 291 BTC ($135,000) in April 2016.
Revolutionary approach and usefulness of the BRC-20
The usefulness of BRC-20 tokens could be enhanced if a tier 2 solution like Stacks opens up to bridge the gap between BRC-20s. This could improve the user experience and lower the barrier of entry for users. However, the cap on decentralized finance (DeFi) of BRC-20 tokens may be limited due to the current size of DeFi on Stacks.
According to Tom Wan, BRC-20 tokens have gained a lot of attention in the crypto space, but there is still room for growth in terms of utility and DeFi features. With the potential for a layer 2 solution like Stacks to connect the BRC-20s, the BRC-20 tokens could see an improvement in their DeFi capabilities, which could attract more users and investors. However, it remains to be seen whether BRC-20 tokens can overcome their current limitations and become a more widely adopted cryptocurrency.
Overall, while BRC-20 tokens have seen an increase in popularity and market value, their usefulness remains limited due to a lack of smart contract capabilities. However, the potential for a layer 2 solution could enhance its DeFi capabilities, which has the potential to become a more widely adopted cryptocurrency.
Featured image from Unsplash, chart from TradingView.com