You probably came across ERC 20 and BRC 20 at some point in your exploration of Web3. For newcomers, understanding the differences between BRC-20 and ERC-20 tokens may seem complex. This article is intended to guide readers on a basic comparison of both token standards.

What is a token standard?

Token standards are sets of rules and parameters that govern how a token operates on the blockchain. Tokens standards allow users to create and manage new tokens in an organized and consistent manner.

Token standards (like ERC 20 and BRC 20) set the parameters for:

1) Creating new tokens

2) Transferring tokens between addresses

3) Checking token balances

4) Approving token transfers

5) Required data structures, interfaces, and methods

About ERC 20 tokens

ERC 20 is the set of rules for developing new tokens on the Ethereum blockchain. It ensures that ERC 20 tokens work with other tokens via smart contracts. This has helped promote interoperability and ease of use within the Ethereum ecosystem.

The creation of the ERC 20 standard has enabled the development of a wide range of digital assets that can seamlessly interact with each other on the Ethereum blockchain. It has become the most popular token standard and has played an important role in the growth of the general Web3 ecosystem.

About BRC-20 tokens

On the Bitcoin blockchain, BRC 20 tokens are an innovative and experimental token standard that makes it easier to create, issue, and transfer fungible tokens on the Bitcoin blockchain. An anonymous programmer, Domo, created this standard in March 2023.

The BRC 20 standard uses ordinal inscription. Thanks to this token standard, the Bitcoin network now has more options such as using it in DeFi protocols and other blockchain-based applications.

Differences between ERC 20 and BRC 20

Trust Machines made a great tabular comparison. Check it below: