Original title: "When I heard BRC-20 for the first time, it seemed like I saw that midsummer again"

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Original source:SevenUp DAO

1. First news about Ordinals, BTC-NFT, BRC-20

This part is a pile of concepts. Although it can be explained in a few words, I still want to put every knowledge point from the perspective of principle. What are sat (Satoshi), Ordinals, BTC-NFT, BRC-20? A single understanding is definitely not impressive, and the head is big.secondary title

1. sat (cong)

First understand a concept, sat (Satoshi): The smallest unit of Bitcoin is "Satoshi", named after Satoshi Nakamoto, the anonymous founder of Bitcoin. 1 btc= 100,000,000 Satoshi, Satoshi is the smallest divisible unit of Bitcoin, and can be traded with Satoshi as the pricing unit.

We can all know now that the Ordinals protocol is a system for numbering sats, and the numbering is based on the premise that each sat (Satoshi) is unique. Each satoshi has a unique identifier, utxo (unspent transaction output), consisting of a transaction id and an output index, that is, each satoshi is generated in order of mining time. Through utxo, the Bitcoin network can track the transaction history and ownership of each satoshi, ensuring the security and reliability of transactions, and also guaranteeing the uniqueness of sat.

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2. Ordinals = "numbering system + comment system"

It's just interesting that the Ordinals protocol has made a layer of extension on top of this "special NFT". Ordinals is a "numbering system + annotation system". Different content carriers can be filled with content, such as JPG, TXT, MP4, GIF, ZIP, etc., to generate corresponding inscriptions in Txt format, inscriptions in image format, etc., but the maximum storage capacity is only 4 M.

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3. BTC-NFT and ERC-NFT are really different

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4. Deployment, casting and transfer of BRC-20

The implementation of the brc-20 protocol is based on ordinal inscriptions, which are actually inscriptions of text type. In the brc-20 protocol, the ordinal inscription is used to store the information of the token contract, including the name, symbol, total amount, decimal places, etc. of the token. The information is coded and stored on the Bitcoin blockchain, thereby realizing the deployment and management of the token contract. By adding some text information in the information record column of the Bitcoin transfer, the casting and transfer of tokens are realized. In fact, the deployment, casting, and transfer of BRC-20 are all casting of a new inscription (text format).

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#summary

In general, sat (Satoshi) is the smallest pricing unit of Bitcoin, and the ordinals protocol assigns a unique number and note to each Satoshi, realizing the uniqueness, irreplaceability and on-chain records of Satoshi.

Btc-nft refers to non-substitutable tokens stored on the Bitcoin blockchain, which can store some small, immutable data, and the stored data will be permanently stored on the blockchain.

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2. The path of explosion, starting from "Narrative Economics"

"Narrative economics" (narrative economics) is the work of the 2019 Nobel Prize winner in economics and American economist Robert Shiller. The book believes that rational actors and complete information hypothesis are not applicable to all economic situations, mainly discusses the role and influence of narrative in economics, and puts forward the concept of "narrative economics".

The author believes that narrative is an important factor influencing people's beliefs, values ​​and behavior habits, and these beliefs, values ​​and behavior habits will affect the development and operation of the economy. The revelation of narrative economics to cryptocurrencies is that the success of cryptocurrencies depends not only on their technology and functions, but also on the power and influence of their narratives, which represent special values ​​and cultures, and question centralized finance and centralized society , which is also an indispensable part of the continuous condensation of cryptocurrency consensus. Similarly, in this book, I also screen out what kind of narrative is more likely to attract the attention of the market, with a wider duration and scope.

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1. Controversy creates consensus, serious prejudice leaves behind information cocoons

Controversial narratives are often more able to grab people's attention, thereby stimulating the thinking of industry participants,As a result, stakeholders will compete for their likes and dislikes from various angles, which in turn is to popularize a certain concept to the public in disguise and increase the spread and influence of a certain narrative.Controversy will make people think critically about these narratives and explore the values ​​and prejudices in them. The stronger the voice of opposition, the more cohesive the group that praises one side. That is to say, it can be found that controversy is an indispensable part of strengthening consensus.

Cryptocurrency was also born from controversy. A strong and viable consensus all started at the end of Qingping and between Weilan. Bitcoin has been pronounced dead or predicted to fail more than 300 times. Price fluctuations, technology Problems, policy regulation, competitors, etc., ETH The dao event hard fork ETC, parity 280 million USD freezing event, congestion and gas war, etc., on the contrary, they have a stronger consensus in the dispute.The consensus of smooth sailing will never last long, and great praise will bring endless backlash,In the past, there was an EOS three-wave betting for 3 dollars, and then there was an ICP ecological silence.

The non-controversial consensus is doomed to be pronounced dead as soon as it comes out, which is flattery.

The current controversial points of BRC 20 are nothing more than a few points:

One is a bunch of "garbage" stuffed in the whole node,So far, Bitcoin has lost its purity, and the blocks have become more bloated, resulting in a sharp increase in storage and transfer costs on the chain;

Second, the inscription is permanently stored on the chain,It means that the redundancy of ledgers over time will lead to higher operating costs of full nodes, requiring higher energy mining equipment, and mining centralization seems to be an inevitable problem;

Third, as mentioned above, sat itself is a kind of NFT,It can be sorted according to rarity. With the help of Ordinals, these rare satoshis can be identified and circulated, and no longer have a unified value, which may cause confusion in the basic unit of Bitcoin;

Fourth, it has poor scalability and does not support smart contracts.Only some minimalist games can be born, and it is difficult to form a strong ecology similar to the Ethereum network.

Are these controversies justified? Of course, and very meaningful, this means the confrontation between the new and old consensus of Bitcoin. If the new consensus replaces the original consensus, the value transfer will not continue but be falsified. This will be an inevitable blow to the foundation of Bitcoin.

But for the speculative game, the controversy here has two meanings.

First, controversy means that a narrative is alive,It is difficult to be falsified until the last moment, and there will be a value of bubbles during the period. Li Xiaolai said well that the consensus of fools is also a consensus. Moreover, once the narrative of BRC 20 is successful, the result will be transformed into a "consensus of smart people" ;

Second, controversy means the early stage of consensus cohesion,secondary title

2. BRC 20 is actually a story

Narrative economics emphasizes the importance of the role and impact of stories in the economy. Stories can arouse people's emotions and resonate with people, thereby affecting people's beliefs, values ​​and behavior habits.In cryptocurrency, an interesting and compelling story is often easier to attract people's attention and interest, and thus easier to spread. A cryptocurrency story can attract investors' attention through vivid scenes, interesting characters and plots In addition, the story can be widely disseminated on social media through traditional word of mouth, so that more people can understand and share it, thereby expanding its influence .

First, what story does the rise of BRC 20 remind people of? The story of Bitcoin itself, such as the Bitcoin pizza incident, a programmer bought two pizzas with Bitcoin in 2010, and today, the value of these 10,000 Bitcoins has exceeded 400 million US dollars, becoming Bitcoin The most expensive pizza in history; there are various stories behind it, DeFi, NFT, meme.. experience or miss the overnight riches, are the best stories.

The story is the carrier of a huge narrative, and it is a safe haven for investors to hold positions and chat for comfort.

Many investors have personally missed the above stories, so potential buyers of BRC-20/NFT will put themselves into the previous scenario of missing "getting rich" and grab attention as soon as possible. Ordinals itself is composed of multiple elements (BTC, NFT, meme, etc.), so it is actually telling a story of a "sudden wealth complex". I can make up for what you missed and did not participate in BTC, NFT, Doge, ENS early sorry.

In general, what you have missed, my Ordinals have it all.

Secondly, from a practical point of view, Ordinals is actually telling the story of assets issued on the BTC chain. The story itself is enough to attract some old OGs. Some people are surprised when they hear it for the first time. BTC? …It is true that ERC/BTC-20 is fundamentally different, and it is difficult to evolve a homogeneous ecology. Although there is no value support compared to Ethereum, the origin of the originator of the encryption consensus narrative originated from this,Therefore, the emerging meme/classic NFT is more "famous" on the Bitcoin chain.

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3. The spread of narrative constellations, not isolated events

The "narrative constellation" in narrative economics refers to a system composed of multiple interrelated narratives. These narratives form a complete narrative framework, making the whole story more full and three-dimensional, with the charm of multi-dimensional communication.Narrative constellations are more influential than isolated single narratives, as they include more audiences, last longer, and have more diverse stakeholders.

Let's take a look at how the narrative of BRC-20/BTC-NFT diverges from Ordinals and whether it can form a huge narrative constellation. Based on Ordinals, two sets of narratives that empower BTC have been derived, NFT and 20.As far as BTC-NFT is concerned, on the one hand, it can reproduce the Ethereum NFT narrative on Bitcoin, squeezing the share of the ERC-NFT trading market,Do princes and generals care about each other? It seems strange to say this while holding Bitcoin...

On the other hand, BTC-NFT is actually a differentiated competition against ETH-NFT. The main focus is the security maintained by a full node and permanent chaining. This is the real inheritance of Bitcoin security and orthodoxy.As far as BRC-20 is concerned, as mentioned above, 20 is actually telling the story of issuing assets on the BTC chain, and the currency above is sat.Sat as the BTC pricing unit has the lowest value guarantee, BTC does not return to zero 20 will never return to zero, the practical value is that sat can act as gas, and the collection value causes the circulation of BTC to be locked in disguise.

It can be seen that the richness of 20 assets will also increase again and again. Currently, only the inscription of 4-digit name tokens is open, and the rare character 20 with three digits and two letters will appear later (ORC is already doing this). I patted my legs and thought, isn't this the logic of the ENS domain name hype? In addition, it is said that some project parties have already begun to issue NFT assets on LTC, which confirms the sustainability of the Ordinals narrative. Thinking about it later, will there be a special mechanism DEX based on BRC 20, an IDO launch platform, or even a lending platform... Good guy, the industry chain will come out soon. In this way BRC 20 is no longer an isolated single narrative.

Narrative economics also emphasizes the celebrity effect. As an irrational behavior, people tend to blindly follow celebrities instead of making decisions based on their own judgment and analysis. The emergence of social media makes the celebrity effect more intense. From the perspective of stakeholders, whether BRC 20 can attract widespread attention from encrypted celebrities, that is, "traders behind the scenes", and then form a narrative constellation.

I am quite touched by a passage that Mr. 0x Todd said, that is, where does the biggest profit in the encryption industry come from?The "head" and "tail" of crypto. The first is the issuance of assets, directly creating assets, such as ZK/Arb, Atpos/SUI, such as btc/eth miners; the tail is the transaction of assets, redistribution of assets, such as Binance, OK.The closer you get to this end, the more excess returns you get. Well, the biggest stakeholders (potential celebrities) have been revealed, namely three-party miners, exchanges and project parties.

First, the miners: the small ball controls the big ball

Ordinal pushes up the demand for block space, allows miners to obtain higher income, and makes up for the marginal decrease in revenue brought about by the halving effect of Bitcoin. Most miners are chasing profit as the first goal.Looking back at the frenzy of Bitcoin forks in 2017 and 2018, it is obvious that there are differences in the community, holding high the banner of justice to "improve" Bitcoin, but in fact it is not to occupy the initiative of mining and obtain more benefits .Therefore, most miners will spare no effort to promote the development of BTC-NFT/BRC-20 and other xRC. Feeding miners by mining rewards will gradually transition to gas fees to feed miners.This wave of BRC-20 is actually "small ball controlling the big ball". The lower cost of controlling the disk can keep the gas cost at a high level. Can this upsurge catch up with the various hard forks in 2017? I think it will.

Second, exchanges: traffic priority

Listing coins on exchanges is nothing more than considering two points, one is the long-term value of the industry, and the other is the increase in trading volume. Can BRC 20 carry more transaction volume? The answer is yes. You can get the clues by looking at the history of the rise of DAO at that time. The peak of PeopleDAO was an average daily transaction volume of 200 million US dollars. Later, it also brought various value DAOs to the industry. Investments, tools, and community DAOs emerged in an endless stream. have long-term value. Currently, the OKX mobile wallet has launched BTC NFT. Not surprisingly, OK should be the first platform to launch BRC 20 spot transactions. By the way, OK should have the technical strength to support 20 transactions, unified accounts, web3 wallets, and on-chain My God, the products are pretty good. Binance has also published related content on popular science Ordinals, and it should be a matter of time before the listing. The exchange will promote new assets in order to capture the trading volume of the hot sector, and it is on the way.

Third, the project party: the main force of asset creation

The Ordinals Hackathon is coming soon, and a large number of developers and practitioners will be captured at that time. Where the talents are, the funds will be there; Yugalabs twelvefold was sold in March, with the highest auction price of 7.1159 BTC, and the pixel was upgraded at the end of April; more follow-up Well-known brands will endorse Ordinals.

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4. The new narrative of returning to the original intention, and the differentiated competition with ETH

First, ETH-NFT is "incomplete" at some level.

The inscription truly inherits the security of Bitcoin. This security does not require side chains or bridges to guarantee it. The inscription is permanently linked to the chain like Bitcoin, and has the same security and decentralization.

Second, the new narrative is superimposed on the old narrative of Bitcoin, and everything becomes more interesting.

With the development of the currency circle, the sensitivity to information in the circle has become higher, and it has become the norm to speculate on the new rather than the old. Although the halving background cannot actually bring about a major change in the marginal supply, it may be able to radiate new vitality after superimposing some new variables such as BTC-NFT, BRC-20, and Lightning Network. In July 22, I wrote an article "Is the correlation between Bitcoin and US stocks a piece of paper?" ", mentioned at that time that "the various narrative lines shown by Bitcoin are constantly transforming.. Digital gold, speculative attributes, commodity attributes, securities attributes, safe-haven assets, etc.. The multi-dimensional narrative is against Bitcoin. The best medicine for a bear market." Today, we see a new narrative that Bitcoin can carry - ordinals.

In fact, cryptocurrency has just taken a long detour, but now it has regained its original intention-payment and asset issuance.

The Lightning Network was launched in 2017, but it has not been adopted on a large scale during this period. The number of channels and the amount of funds in the past year have also stagnated.The explosion of Ordianls may be able to "unintentionally insert willows and willows into shadows" and activate the application scenarios of the Lightning Network. The casting and transfer of a large number of inscriptions will inevitably lead to block congestion and high GAS fees.From the perspective of technical feasibility, sat can be traded on the lightning network. To put it bluntly, an inscription is a special bitcoin transaction.Ordinals act as an intermediary for asset issuance, the lightning network is responsible for the low-cost transfer of inscriptions, and the BTC main network collects transactions for settlement.Many new "fireworks" can be collided on top of this, look forward to it.

From this point, we can see that many people are talking about whether the ecology on BTC is comparable to the ecology of ETH?

In fact, this itself is a question that cannot be considered equally. The starting point of the two is different, just like Alibaba's Alipay and Microsoft's Windows can be compared in the same industry?The end of the Bitcoin ecology must not be the starting point of Ethereum. The two compete in a differentiated manner. Bitcoin is a digital currency, mainly used for payment and value exchange, while Ethereum is a smart contract platform that can support more application scenarios and function.secondary title

5. Easy to understand, 0.1 education cost

Narrative economics mentions the concept that simple and clear narratives are easy to spread. This is because when people receive information, it is easier to understand and remember simple and clear narratives than complex and difficult information. A narrative that resonates emotionally is often the starting point for making investment decisions in cryptocurrency, and it is also the starting point for digging down information and investing in value. The top-ranked cryptocurrencies are all wonderful narratives that can be summed up in one sentence, BTC is anti-inflation gold, ETH is an ecosystem for carrying applications, LINK is a bridge linking off-chain information, and UNI can be traded on-chain without CEX.. It is true that their bottom layer may be very complicated, with sophisticated design and ingenious ideas, but in the end they can sum up one sentence and tell investors-I am simple, but I am very good.

From the name of BRC-20, there is almost only 0.1 education cost.

When you see BRC, you will naturally think of ERC, and when you see 20, you will naturally think of token issuance and the ICO boom in 2017. From a practical point of view, both brc 20 and erc 20 are token standards, carrying the tasks of asset issuance and circulation; from the perspective of participation threshold, for ordinary users, the threshold for participating in brc 20 tokens is relatively low, only Some basic knowledge of bitcoin wallets and transactions is required, and for developers, the deployment and management of brc 20 tokens is simpler and safer.

Since the word web3 was born, it seems to have been coerced by some mysterious terms, decentralized, anti-censorship, and non-tamperable. There is still a gap visible to the naked eye before it becomes "mainstream".

In-depth study of algorithms, encryption and other related knowledge and technologies seems to have become the "basic literacy" agreed by insiders. High cognitive barriers and poor user experience are barriers to further exploration of cryptographic value discovery. And some simple encryption concepts that can arouse emotional resonance can always break through the cocoon,first level title

3. Enlightenment: The Essence of Encryption

1. There is a poem in Gibran's "The Prophet": We have gone so far that we have forgotten why we started.

Web3 has changed its taste, how many shadows of the spirit of cryptocurrency are there? Many euphemisms are: regulated, large traffic, incremental market.. Just like RWA, Hong Kong dollar stable currency, etc., even if this allows the whole world to participate, what is the point? The essence and original intention of the blockchain are only two points, low-cost trust + the freest freedom. Marx said that commercial credit is one of the indispensable conditions in the process of capitalist reproduction, so low-cost trust plays an important role in promoting commodity circulation and accelerating capital turnover; a16z's early articles believed that the decentralized nature of cryptocurrencies can give people , resources, etc. can be traded and communicated more freely, thereby breaking the problem of unsustainable innovation cycles. If there is no trust and strong freedom, then this so-called "Web3" project is meaningless. These two words are "common sense" in the field of cryptocurrency. You can make money by following value investing, but you will probably not be able to make money if you go against common sense. to money.

2. Meme is an experiment, and cryptocurrency is also an experiment. The strong consensus is always criticized, and unexpected gains can only be achieved by trying new opportunities.

There are two things that often appear in the encryption field, namely fud and new things-both are rewards for investors, and the powerful things are often fud→increasing controversy→consensus cohesion, which is an inevitable law of development of things; While new things seem to have fragile vitality, in fact, it only takes a few OGs and media touts to grow into a behemoth. The value discovery is already too much in cryptocurrency, and some opportunities that are not listed on the stock market are on the same starting line as investment institutions. In the end, everyone found that hype meme is the original intention of returning to cryptocurrency, no trust intermediary + freedom. The big Alphas behind cryptocurrencies should discover early on-chain opportunities. This market will reward early participants faster than ever. Once listed on mainstream exchanges, value discovery can be completed within a few weeks.

3. Don't get into the drama too deeply, your prejudice is not everything.

References

References

• Thanks to the early contributors of Ordinals in the Chinese area, let me "hear the BRC-20 for the first time", manual Aite, everyone, thank you for your persistence!

• @eth 520 eth@GGstarlord@ohxiyu@LiHuanLH@Brc 20 CN@RetireTomorrow

• https://ordspace.org/brc 20 

• https://ordinalswallet.com/collections

• https://twitter.com/GGstarlord/status/1647157322282590209 

• https://twitter.com/joyrich 33/status/1651196781852770305 

• https://twitter.com/firstray_crypto/status/1650762602165997571? s= 20 

• https://twitter.com/0x Wendy 99/status/1651207108292145154 

• https://twitter.com/eth 520 eth/status/1651511551617306624 

• https://twitter.com/joyrich 33/status/1650774214377611265 

• https://twitter.com/RetireTomorrow/status/1633726794296885248 

• https://twitter.com/ohxiyu/status/1651555634993610760 

• https://mirror.xyz/0x421d67Be08E9B0B656763354b273f422E1527CdC

• https://www.youtube.com/@LiHuanLH