Definition
A BRC-20 token is a fungible token represented through an application-level convention associated with Bitcoin inscriptions. In the original BRC-20 experiment, small JSON inscriptions describe operations such as deploying a token, minting units, and preparing transfers. Indexing software interprets these records and calculates balances according to the convention's rules. Bitcoin nodes validate the underlying Bitcoin transactions, but they do not natively enforce a BRC-20 account ledger as a separate consensus asset. The name resembles Ethereum's ERC-20 standard, yet the original design does not provide the same smart contract execution model. Users must also distinguish token units from the satoshis and transaction outputs carrying associated inscriptions. Transfers can involve several steps, fees, and indexer-dependent interpretation. A token's existence on Bitcoin does not guarantee liquidity, useful rights, safe trading, or agreement among every application displaying its balance.
Source references
References accompanying this glossary entry:
Educational reference, not financial advice. See our financial disclaimer and editorial policy.