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The trading volume for BRC-20 tokens has surged, rising from $10-15 million to over $500 million since November 2023, according to data from Kaiko.
The data indicates a substantial increase in trading activity for tokens minted on the Bitcoin blockchain, with their volumes experiencing a tenfold growth since the close of 2023.
BRC-20 Token Trading Volume Surge
According to a report on January 15 by the Paris-based blockchain analytics firm, trading volumes for BRC-20 tokens have surged, with Binance playing a significant role in the increase.
Binance recently introduced spot and perpetual futures trading for ORDI, SATS, and RATS tokens. Initially holding a 63% market share, Binance’s dominance declined to around 50% as trading volumes reached $2 billion following the listing of SATS and RATS.
OKX, the first exchange to list the BRC-20 token ORDI, has become the second-largest spot market for BRC-20 tokens, holding a 35% share.
The increased trading volumes of BRC-20 tokens have led to a surge in demand for block space on the Bitcoin network, resulting in higher transaction costs and sparking controversy.
In early December 2023, Bitcoin Core developer Luke Dashjr raised concerns that data inscription exploits a vulnerability, potentially leading to spam on the Bitcoin blockchain. Dashjr urged blockchain developers to address this perceived vulnerability.
BRC-20 Tokens Usher in New Era for Bitcoin
In its latest report, Binance Research has declared that BRC-20 tokens have ushered in a “new era” for Bitcoin. Binance suggests that Ordinals inscriptions and BRC-20 tokens significantly influenced Bitcoin’s growth and market dominance in 2023.
The report highlights that Bitcoin increased its market dominance from 40.4% to 50.2%, surpassing half of the total market capitalization in the crypto space. Binance researchers noted a clear impact on the network’s activity attributed to inscriptions and BRC-20 tokens, particularly evident in the increased mempool transaction count.
A spokesperson from Binance Research emphasized that the growth of BRC-20 tokens was a crucial narrative for Bitcoin in 2023 and is expected to remain an important topic in 2024.
Additionally, the spokesperson highlighted the economic impact, stating that Ordinals and BRC-20 tokens contributed to higher transaction fees, which can be advantageous for miners, especially considering the upcoming Bitcoin halving in 2024.
Introduced in March 2023, BRC-20 is a new token standard on the Bitcoin network, leveraging the Ordinals protocol to enable the inscription of data on satoshis, the smallest unit of BTC.
This article first appeared at CryptoPotato
