Recently, many people may have become confused by the various inscriptions and runes in the Bitcoin ecosystem. In particular, there are various -20 concepts, such as BRC-20, ARC-20, SRC-20, DRC-20, ORC-20, PRC-20, ASC-20, and so on. While watching others’ FOMO and witnessing the rise in prices of various tokens, I feel like I’m neither keeping up nor catching up. However, I still maintain that the two most important basic principles of investment are: first, standby your principal, and second, refrain from investing in things you don’t understand.

Today, we will use this topic to sort out some content about the Bitcoin ecology. Today’s article is mainly divided into five aspects: a brief review of several popular protocols in the Bitcoin ecosystem, what is the difference between inscriptions and runes, what are the representative tokens of inscriptions and runes, and inscription/rune related tools (supporting The attached table organizes nearly 70 tools) and a brief analysis of Bitcoin ecological related projects.

Several popular protocols in the Bitcoin ecosystem currently

1.Ordinals Protocol

Ordinals was born in December 2022 and was developed by Casey Rodarmor. The protocol is a system for numbering Sat (Satoshi). Ordinals tracks each Satoshi in transactions by assigning them a serial number. At the same time, users can attach additional data (images, videos, text, etc.) to the Bitcoin block through Ordinals. On the blockchain, each Satoshi is unique and possesses the properties of an NFT.

2.BRC-20 (Token standard based on Ordinals protocol)

BRC-20 was born on March 8, 2023, and was launched by anonymous developer domodata (a person who wears a mask in public). BRC-20 is an “improved” protocol based on the Ordinals above. This protocol implements the deployment, minting and transfer of tokens by writing the token name, total amount and other information into Satoshi in standardized JSON format. The name BRC-20 sounds very much like the well-known Ethereum ERC-20 token standard, so we can also simply understand BRC-20 as an altcoin developed based on Ordinals (that is, based on Bitcoin) Release Agreement. The first token of the BRC-20 protocol is called Ordi. This concept has become popular twice this year, first in May-June and more recently in October-November.

3.STAMPS protocol (SRC-20)

Stamps (also known as Bitcoin “stamps”) was launched by anonymous developer “Mike In Space”. Stamps is an “improved version” of the Counterparty (a protocol born in 2014) protocol. Its biggest feature is that it can always exist on the BTC chain, and all nodes must synchronize this data. That is, it can embed image data in base64 format into the transaction output on the Bitcoin chain, thereby permanently saving the corresponding image data on the Bitcoin chain. After Ordinals/BRC-20 became popular, Stamps also became popular for a while, but maybe because it was more expensive and difficult to popularize, it seemed that it didn’t become popular again. The advantage of Ordinals is that they are cheap. At that time, casting normally only cost 3-5 US dollars, while STAMPS cost almost 60 US dollars per time.

4. Atomicals protocol (ARC-20)

The Atomicals protocol was born on September 17, 2023, and was launched by another anonymous developer (he believed that Ordinals had some shortcomings, so he wanted to continue to improve it). Unlike the Ordinals protocol, which was originally designed for NFTs, Atomicalsl rethinks how to issue Tokens on BTC in a centralized, tamper-proof and fair manner from the bottom up. ARC-20 is also the first token protocol to mint inscriptions through POW, which means that participants can directly mine inscriptions/NFTs like they used to mine Bitcoin. A few days later (September 21), someone issued Atom, the first token on the Atomicals protocol, and it was fully mined in less than 5 hours.

5.Runes Protocol

With the popularity of BRC-20, transactions of BRC-20 related tokens accounted for the majority of the Ordinals protocol. This matter seemed to make CEO Casey Rodarmor feel very unhappy. According to Casey Rodarmor, he believes that BRC-20 will generate “garbage” and occupy the Bitcoin space. Coupled with the emergence of Atomicals, a newbie. On September 26, 2023, Casey Rodarmor redeveloped a protocol called Runes (which is what everyone now refers to as the Rune Protocol) as a replacement for BRC-20. This protocol is a simple FT (Fungible Token) protocol based on UTXO (Unspent Transaction Output) that enables Bitcoin users to have a good experience. Also because the protocol is based on UTXO, it means they can be more easily integrated into RGB or Lightning Networks.

Here is another small episode, when Binance listed the ORDI token, there was a mistake in which the official website introduction of the token was mistakenly linked to the Ordinals protocol. This displeased Casey Rodarmor, and he made a serious clarification and requested Binance to remove the content related to Ordinals.

6.Pipe protocol

After the emergence of BRC-20, an active developer named Beny appeared in its community. This guy is not only an outstanding developer, but also a master of taking advantage of hot topics. He launched the BRC-20 printing tool LooksOrdinal in March this year, deployed the inscription crsd in May, launched an improved version of the Tap Protocol based on BRC-20 in August (essentially also based on the Ordinals protocol), and launched it again in October. An improved version of Pipe protocol based on Runes (mainly adding mint function based on Runes).

What is the difference between inscriptions and runes?

We have mentioned above that the Runes is the rune protocol.

But at that time, the Runes protocol did not cause much turmoil in the market. Until recently, a project called Rune Alpha was launched, which directly drove market sentiment and caused FOMO among users (the reason for FOMO may also be because the name is too similar to the Runes protocol) .

Although boss Casey Rodarmor has immediately posted on social media that Rune Alpha has nothing to do with his Runes, and the Rune Alpha project team has also explained that it has nothing to do with it, Rune Alpha’s first issued token COOK still attracts the attention of many users into crazily inscribing.

At the same time, pipe, the first token based on the Pipe protocol, also began to be hyped, and the flames even directly burned the tokens of the Ethrunes protocol. Ethrunes is a token protocol based on ERC-1155 (Ethereum) and combines the features of BRC20. The first token of this protocol is ERS.

So, what is the difference between inscriptions and runes?

From a technical point of view, let’s directly quote @evilcos: A key difference between Bitcoin Inscription and Rune is that the inscription is engraved in the Segregated Witness data, while the rune is engraved in OP_RETURN. The data size that OP_RETURN can store is very limited, but it is more than enough for issuing coins. And this is not a new technology.

Representative tokens with inscriptions and runes

Next, let’s sort out the tokens of related protocols in the simplest way (there are too many, only a very small part is listed here).

1.Bitcoin system

BRC-20 (inscription): Ordi (leader), sats, rats

ARC-20 (inscription): ATOM (leader), Realm

SRC-20 (stamp): stamp, kevin, utxo

Rune: Pipe (leader)

Rune Alpha: COOK, PSBTS

2. Ethereum system

Ethscription: eths (leader), Facet

IERC-20：say

Of course, because inscriptions/runes are now very popular, there are still many inscriptions appearing, such as inscriptions based on other chains:

DRC-20 (Dogecoin): dogi

BSC-20（BSC）：bnbs

SPL-20（SOL）：Sols

LRC-20（Litecoin）：lite

PRC-20（Polygon）：pols

ASC-20（Avalanche）：avav、asct、avas

TRC-20（TRON）：trxi

ORC-20 etc.

Inscription/rune related tools

The most commonly used tool is probably the wallet, and some wallets currently also integrate trading market functions. For most newcomers, a wallet is all they need.

OKX Wallet: Currently it can support BRC-20 and SRC-20 (this protocol only supports wallet addresses starting with 1 and does not support addresses starting with bc1), and has built-in functions for trading and issuing BRC-20 tokens and NFTs. It also supports public chains such as ETH, SLO, and AVAX.

Unisat Wallet: Currently a BTC wallet with a relatively high usage rate. It currently supports BRC 20 and SRC 20 (addresses starting with bc1 are not supported either), and there is a trading market.

There are also other options such as Atomical Wallet (ARC20), Unielon Wallet (DRC20), etc.

If the functions of the wallet still do not satisfy you, then you can consider some specialized market platforms (tools). for example:

1.Stampscan or Openstamp (SRC-20 market)

2.Atomic Market (ARC-20 Market)

3.Avascription (ASC-20 market)

4.Magic Eden or Tensor trade (SPL-20 market), etc.

Below is a collection of inscription tools that I have collected and organized (the address is as follows). The accompanying attachment table contains a total of nearly 70 inscription-related tools. As shown below.

Judging from the current overall trend of the inscription market, it can be roughly divided into several directions, such as the classical faction represented by Ordi, the community-driven MEME faction represented by sats and rats, the technical faction represented by atom, and The main faction of institutions is represented by mubi (MultiBit is the first two-way cross-chain bridge for cross-network transfers between BRC20 and ERC20 tokens).

Bitcoin ecological project

As the above various inscription protocols continue to gain popularity, layer 2 in the Bitcoin ecosystem may become the next wave of hot topics. Take the Lightning Network as an example. The Lightning Network is a “long-standing” Bitcoin layer2 concept, but the problem is that the Lightning Network does not support smart contracts. So it gives other layer2 protocols a chance. for example:

Taproot Assets: A protocol launched on October 19 that enables instant, high-volume, and low-fee transactions over the Lightning Network.

Nostr Assets: One of the more popular protocols recently, the related tokens trick and treat have also increased a lot.

In addition to the above protocols, there are also some protocols with relatively complete technologies, such as Stacks, RGB and BitVM. Their main difference is that Stacks is suitable for Ethereum application migration, BitVM emphasizes off-chain computing and fraud protection, and RGB focuses more on privacy.

In short, as the BRC-20 ecosystem expands, we expect to see a large number of interesting projects launched. Next, I will continue to list some other projects that are worthy of attention in the near future.

The first project is CHAX

CHAX is a RWA pioneer in the Bitcoin ecosystem and Ordinals, Atomicals, and Taproot asset liquidity infrastructure, a protocol that provides liquidity construction and revenue for the BRC20 project.

Additionally, they created L2 Rollup as a way to scale Ordinals and Atomics and expand them into the broader Bitcoin DeFi space. 21% of the maximum supply of the project’s tokens is in circulation.

The second project is OrdiZK

OrdiZK is a cross-chain bridge between the Ethereum and Bitcoin networks utilizing zk-SNARKS technology.

The third project is Ordinal Tools

Ordinal Tools is a Tele Bot project that provides a two-way bridge for transfers between BRC20 and ERC20 tokens. 99.5% of the project’s total token supply is in circulation.

The fourth project is Dova Protocol

Dova is a BRC-30S lending protocol with an integrated MultiBit bridge that allows seamless transfer of BRC-20 tokens across chains. Users can then make collateralized loans with the transferred tokens using the Dova protocol on Ethereum.

In addition, users can also access Ethereum, Binance Smart Chain, Polygon, etc. through the BRC-30S protocol, or expand loans, games, NFT and other services.

The fifth project is NXHUB

NxHub is an aggregation marketplace running on Ordinals. It captures order data from platforms such as UniSat, OKX, MagicEden and OrdinalsWallet and displays it in an aggregated manner.

The 6th project is OrdBridge

OrdBridge is the first bridge to allow users to seamlessly transfer BRC-20 tokens between BTC and Ethereum. Its outstanding feature is the ability to send BRC to ERC and be backward compatible. That is, they found a way to bridge ERC (ETH) — ERC (AVAX) and the native BRC token, and users can transfer the native BRC token between BRC, ETH, and AVAX.

But we need to remind you again that new projects tend to be relatively risky, and all the projects listed above are for learning purposes only.

Alright, we will temporarily conclude today’s content here. We will continue to bring you more relevant sharing in the future. Interested friends can check and learn more content through the Hua Li Hua Wai public platform.

Note: The above content is only a personal perspective and analysis. It is only used for popular science learning and communication and does not constitute any investment advice. The crypto market is an extremely high-risk area. Please treat it rationally, increase your awareness of risk prevention, and abide by the relevant laws and regulations of the country and region where you are located!

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