From a beginner to an investor: how to acquire BRC-20 tokens

The Emergence of a New Trend in the Crypto Ecosystem

When the cryptocurrency market was going through challenging times in early 2023, an interesting alternative appeared on the horizon. Based on the Bitcoin blockchain, a new category of digital assets — BRC-20 tokens — began active development. This phenomenon demonstrates how, even during periods of uncertainty, innovation continues to open fresh opportunities for the crypto community.

What Are BRC-20 Tokens

BRC-20 tokens are a kind of evolution in the world of decentralized finance. Built directly on the Bitcoin blockchain, they enable the creation of interchangeable assets, similar to how the ERC-20 standard functions on the Ethereum network.

This architecture allows expanding Bitcoin’s ecosystem far beyond simple payments. Tokens can represent various digital and tangible assets, interact with smart contracts and decentralized applications, creating an ecosystem where Bitcoin becomes a platform for a whole class of financial and crypto-instruments.

Scale of the BRC-20 Ecosystem: Numbers and Trends

Statistics on BRC-20 development speak for themselves. The ecosystem has over 55,000 unique tokens, indicating continuous interest from developers and investors.

Blockchain activity shows momentum: in 2023, transaction volumes with BRC-20 tokens reached a peak of about 400,000 transactions per month, with the total number of transactions exceeding 40 million.

In terms of market value, the total capitalization of the BRC-20 segment exceeds $451 million. Trading volumes of these assets amount to over $145 million, demonstrating strong demand among traders and investors.

Bitcoin Ordinals and Their Role in Expanding Possibilities

Alongside BRC-20 tokens, another important technology has emerged in the Bitcoin ecosystem — Bitcoin Ordinals. While BRC-20 specializes in interchangeable assets, Ordinals revolutionized the approach to unique digital objects.

Ordinals assign sequential numbers to individual satoshis, creating true non-digital digital artifacts similar to NFTs. This technology has opened a completely new direction for digital ownership and creativity on the Bitcoin platform.

The popularity of Bitcoin NFTs is impressive: trading volumes of these assets reached $200 million in just three months. Developers and collectors have inscribed over 45 million unique Ordinals, indicating explosive activity in this sphere.

Practical Applications of BRC-20 Tokens

The versatility of BRC-20 is revealed in many practical scenarios:

Tokenization of tangible assets — from real estate to artworks, these tokens simplify the process of trading physical assets via blockchain.

Decentralized financial services — DeFi protocols gain a new tool for lending, borrowing, and yield farming using Bitcoin’s security.

Gaming and entertainment segment — in-game assets and items can be represented as BRC-20 tokens, ensuring secure and transparent circulation.

Governance and voting — in decentralized structures, these tokens can serve as tools for democratic decision-making.

Reward and loyalty programs — companies use BRC-20 to create modern systems for accumulating and circulating bonuses.

Cross-chain technologies — BRC-20 act as a bridge between Bitcoin and other blockchains, expanding interaction possibilities.

Specialized financial instruments — from stablecoins to derivatives, the scope of application is constantly expanding.

How to Purchase BRC-20 Tokens on Centralized Platforms

The easiest way for beginners is to buy BRC-20 tokens through a centralized exchange. The process involves several steps:

Registration and verification — create an account on the chosen centralized exchange, complete KYC verification. Fund your trading account, usually via USDT or directly through fiat payments.

Choose a trading pair — go to the spot trading section and find the trading pair you are interested in. Popular combinations include ORDI/USDT, SATS/USDT, and RATS/USDT.

Place an order — select the number of tokens you want to buy. You can execute a market order at the current price or set a limit order at a specific price.

Store assets — purchased tokens will appear in your trading account. If desired, transfer them to a personal wallet for added security.

Buying BRC-20 Tokens via Web3 Platforms

If the token you are interested in is not listed on a centralized exchange, you can usually find it on decentralized platforms. This process is somewhat more complex but allows access to a broader range of assets.

Choose a compatible platform and wallet — find a Web3 service that supports trading of the BRC-20 tokens you want. Make sure the platform is reliable and secure. Use wallets like Ordinals Wallet, Unisats, Xverse, or Sparrow Wallet.

Use Bitcoin as the base asset — since BRC-20 exist on the Bitcoin blockchain, you will need BTC. Purchase the required amount of Bitcoin via a centralized exchange using fiat or other crypto assets.

Transfer BTC to your personal wallet — this is a critical step, as BTC will serve as the payment method for acquiring BRC-20 and paying transaction fees.

Connect your wallet to the trading platform — open the Web3 platform and authorize your wallet following the provided procedure.

Make a purchase — find the desired token and place an order for the preferred amount. The process may vary depending on the platform, so follow the instructions carefully.

Ensure the security of your assets — after purchase, keep BRC-20 tokens safe. For large volumes, consider using hardware wallets as an additional layer of protection.

Monitoring and Managing Your Portfolio

Investing in BRC-20 tokens requires ongoing attention. Regularly check your positions, follow crypto market news, and stay informed about regulatory changes that could affect your assets’ value.

Do not forget about the risks inherent in this segment. Before making any investment decisions, conduct your own research and, if necessary, consult a financial professional.

In Summary: The New Evolution of Bitcoin

The rise of BRC-20 tokens, Bitcoin Ordinals, and NFTs based on Bitcoin marks an exciting stage in the development of crypto assets. These technologies expand the boundaries of what was possible with Bitcoin, transforming it from a simple payment network into a universal platform for creating and trading digital assets.

For investors, creators, and collectors, this opens new horizons. However, like any new direction in the crypto economy, success requires a balanced approach, detailed analysis, and understanding of associated risks. Those who can combine curiosity with caution will find many interesting opportunities in this space.