Binance Research Predicts Continued Growth of BRC-20 Tokens Amid Bitcoin's Ascendancy
Summary:
Binance Research emphasized the growth of the BRC-20 token standard in Bitcoin's ecosystem in a recent report, countering skeptics of Bitcoin Ordinals. The BRC-20 standard, first established in March 2023, boosted exchanges with meme tokens like Pepe (PEPE) and helped Bitcoin increase its market dominance from 40.4% to 50.2% in 2023. Binance sees the trend continuing in 2024, stating that Bitcoin's decentralized nature allows its community to determine its use. The increased transaction fees due to Ordinals and BRC-20 tokens are seen as beneficial for miners ahead of Bitcoin halving in 2024.
The analytical department of cryptocurrency exchange Binance emphasized the increasing significance of BRC-20 tokens in a recent study, countering skepticism regarding Bitcoin Ordinal's role within the Bitcoin framework. Binance's latest research piece coins the term "new epoch" for Bitcoin, owing to the heralding effects of BRC-20 tokens. The BRC-20 standard, established in early March 2023, saw a surge in popularity due to the creation of viral tokens like Pepe (PEPE). Binance maintains that the fortunes of Bitcoin Ordinals and BRC-20 tokens significantly influenced Bitcoin's remarkable growth and dominance in 2023.
In 2023, Bitcoin saw a stellar rise in market dominance of 24%. Source: Binance. In its analysis, Binance deduced that Bitcoin’s dominance swelled from 40.4% to 50.2%, thereby reigning supreme over half of the total crypto market cap. The investigative team recognised that the network activity had been significantly spurred by inscriptions and BRC-20 tokens, attributing the rise to an uptick in Bitcoin’s mempool transaction count. Bitcoin's mempool transaction count rose between Feb. 2021 and Dec. 2022. Source: Binance.
The growth and importance of BRC-20 tokens in relation to Bitcoin is a key narrative in 2023, according to a Binance representative who spoke exclusively to Cointelegraph. The firm anticipates that this narrative will remain pivotal in 2024.
“The substantial rise in market capitalisation and the enlistment of leading BRC-20 tokens on significant exchanges contributed to the overall market expansion," highlighted the spokesperson.
Addressing doubts regarding Ordinal's involvement in the Bitcoin network, the representative asserted that Bitcoin operates as a decentralised and permissionless entity, where the community can utilise it as per discretion. “The application of this technology is not restricted by any individual or group.”
The spokesperson from Binance asserted that, from a financial perspective, Ordinals and BRC-20 tokens have been instrumental in enhancing transaction fees. This ensures benefits for miners, who will have to face the ramifications of Bitcoin halves expected in 2024.
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Published At
1/15/2024 4:15:13 PM
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