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BRC-20: A retrospective chat with its creator, Domo
This year has been quite eventful for Crypto as a whole and this of course includes the big daddy of them all; Bitcoin. One of the more public stunts that happened this year was Balaji’s “$1m Bet”. As we all know now, this didn’t end up materialising and Balaji conceded his bet during the middle of the timeframe. However, the timing of the bet is interesting for another reason.
During the same timeframe the bet was being conceived, a pseudo-anonymous researcher was tinkering away at his workstation on what would ultimately become the BRC-20 token standard. After publishing this on his gitbook, Domo has quite literally changed the paradigm when it came to the Bitcoin network in more ways than one.
It’s not often when I’m researching topics for PageOne that I’m left speechless but in this instance, even that would be an understatement. The impact BRC-20 has had on the network can’t be understated, so here are some surreal facts about it. Mind you, what you’re about to see is in relation to the entire history of the network since its launch in 2009:
The highest # of TX per day (ever) (8th May, 2023)
#2 Highest average fee % in total block reward (8th May, 2023)
#3 highest TX fee (both average and median) (8th May, 2023)
Google returns over 40 million results when you type in “BRC-20”
Luckily for us all, we’ve been friends with Domo since before he jumped into Bitcoin development and had the privilege of asking him some questions about everything that has happened since he published the standard. The following conversation is a retrospective chat that I’ve had with him concerning everything Bitcoin and BRC-20.
Hope you all enjoy it!
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Boffin (B): What do you do & kindly Introduce yourself a little
Domo (D): Hey, I'm Domo, an on-chain data enthusiast and creator of BRC-20 standard. I’ve been in crypto for a number of years now and found my way into on-chain analytics in the summer of 2020. My main focus in the past was on NFTs, for which I used on-chain data to sculpt thesis' or track narratives.
At the start of the year, I began trying to build a brand within the blockchain analytics space having grown adequately adept in it, by building public dashboards and consulting with teams/DAOs. My most successful dashboard introduced me to Bitcoin network data, a chasm that ultimately resulted in the creation of the BRC-20 standard.
B: Why choose Bitcoin? Can you also relay some of your thoughts on both the Taproot upgrade (2021) and the Ordinals protocol (Jan 2023)?
D: 1 sentence answer? It's Bitcoin innit.
The longer answer is that Ordinals came at a funny time, right after canto NFT szn (RIP Feb 1st - 2nd 2023). Practically everyone assumed that Ordinals would be a flash in the pan like Canto NFTs but It was abundantly clear to me that this wasn't the case. A couple of key things clicked in my mind for me to delve deeper. Namely due to the permanence & prestige of the Bitcoin blockchain itself, and the elegance & simplicity of the Ordinals protocol.
For those who don’t understand the Ordinals protocol, an analogy I like is similar to the invention of the microscope. A new lens for observing the world, and in doing so revealing an unseen universe of microorganisms (in this case satoshis), opening the door for a myriad of discoveries.
B: When people generally think of the Bitcoin network and the development on top of it, the first project that people think of is "The Lightning Network". What made you not want to contribute to that and rather go into the taproot SC capabilities?
D: Fwiw, I think the lightning network is very cool, and I welcome a future with BRC-20 lightning channels as a scaling solution. Its main issue, however, like many other prior Bitcoin-based protocols is:
Ease of access
Ease of scale and
The biggest problem with blockchain; Ease of use.
Conversely, the accessibility and simplicity of Ordinals (enhanced further via inscription tools), fixated me and catalyzed my move from an enjoyer to an experimenter. These tools ultimately acted like a portal into the most widespread, secure, and trusted data availability layer that anyone with a Bitcoin wallet can easily participate in.
Never before had writing arbitrary data on-chain been so easy (send X BTC to Y Address), and the resulting opportunities excited me. They continue to this day and will continue to too.
B: When launching the BRC-20 standard on gitbook, what were you realistically expecting to happen (as we all know what truly happened!) and what were your original plans with this?
D: "This is just a fun experimental standard demonstrating that you can create off-chain balance states with inscriptions." is the first line in my gitbook and quite succinctly demonstrates my mindset at launch.
I did not have any overarching grand ambitions, and my most realistic hope was that I continue to grow my brand in the crypto analytics space with this being a part of my “past research”. To even achieve this, however, I knew I had to be careful as the condemning nature of the Bitcoin community imposed social constraints upon an already technically constrained design space.
Consequently, I designed the protocol to best emulate Bitcoin's ethos, namely with a fully transparent and fair launch mechanism.
B: You've said your main focus was that of on-chain data and tracking narratives, what are your thoughts on the narrative that BRC-20 tokens took?
Some people in the BTC community love what you did while others say how you killed the original vision. Having been through the entire "cycle" (so far), what were some of the most memorable, surprising and just things that happened after?
D: In the last five years, a segment of the Bitcoin community has become increasingly resistant to change and innovation. Unsurprisingly BRC-20 is no different, and ironically it’s the distribution mechanism that I selected to attempt to best emulate Bitcoin’s principles that has caused the most pushback.
I often feel like some of the biggest voices in the community are more concerned about engagement farming and growing their own brand as a “thought leader” without experimenting or pushing a single line of code. As I’ve said, a certain subset just hates everything.
It has been amusing to me to see people wildly speculate on inscription numbers, new mints and rare satoshi’s, yet have the nerve to claim the high moral ground over BRC-20. Honest to self.
Another popular narrative is that BRC-20 is deeply inferior to its competitors. This one is also puzzling as currently, BRC-20 has no live competitors. There are a couple of very interesting projects coming in the future, that I would love BRC-20 to be compatible with.
*At the time of asking Domo this, the proposal for RUNE & Taproot Assets weren’t live but as they were released in the middle of creating this, I asked Domo for his thoughts on it*
B: a) What are your thoughts on the “Runes” system which was proposed by the creator of the Ordinals protocol, Casey?
D: In the initial BRC-20 docs, I've consistently encouraged the Bitcoin community to explore and refine standard designs until a consensus on best practices emerges. It's honestly surprising that it took half a year for an alternative like Runes to come into the picture. Currently, Runes is in its conceptual phase; and its practical distinction from BRC-20 will become evident upon implementation. If the two standards bear similarities, the market will ultimately dictate the preferred choice. Conversely, if they're markedly different, both could coexist. Regardless, the unique inception of certain BRC-20s will be challenging to replicate. They'll undoubtedly persist in whichever standard prevails, either with the status quo or through mechanics like bridging or wrapping.
B: You've touched upon simplicity a few times already and I'd like to know what are some things that you feel are holding mainstream adoption of Bitcoin tech back?
Aside from the typical "Crypto is a scam", what specifically makes it hard for people to use BTC and what do you think is the hardest thing for devs to make tech here?
D: The last few years when people are going through the decision process to select a blockchain to build upon have either consciously or unconsciously skipped Bitcoin. I feel a major reason for this is that the Bitcoin script is very limiting and historically poorly documented (The irony) which has ultimately meant that the design space has been narrow.
This was until the Ordinals Protocol came along and accomplished 3 key things:
Created a Bitcoin data availability layer, creating a canvas for arbitrary data.
Demonstrated social consensus can work as a core mechanism in protocol design, allowing imagination to be the limiting factor rather than technical.
Gave function to previously useless Bitcoin operations like PSBT’s. An analogy is silicon prior to semiconductors.
In unison, these three breakthroughs set the stage for what I feel is a renaissance in Bitcoin development.
B: It’s fair to say that creating a "brand" in your 2023 bingo has been checked off, though in very different circumstances due to this. Do you that things have now been changed for you because of what you created?
D: Without a shadow of a doubt. You and the rest of the PageOne lads have historically known me as an on-chain NFT and coin trader, so for anyone who has known me prior to this now seeing me spreading the Bitcoin gospel must be strange.
I assure you this pivot is not mercenary (as a lot of teams/projects in this space have a reputation for being).
Yes, undoubtedly there are very high expectations, despite the many disclaimers I put in my gitbook. To meet them, my perspective is that the best outcome for the assets issued on BRC-20, is the continued development of the standard, and portability into other standards as they pop up.
As a one-man show, working on this part-time, my solution to this is to create the Layer 1 Foundation, with the intention of becoming the hub for metaprotocol discourse and development.
B: I’d be remiss to mention this and I think this is one of those things that only a handful of people in history have ever done. The market cap for BRC-20 tokens hit a collective market cap of over $1bn in just over 2 months of you publishing the standard on gitbook.
I’m pretty sure that makes BRC-20 the fastest sub-asset to reach a billion-dollar valuation (in any asset class, ever).
Simple question; What does it feel like?
D: I think apart from being a cool little elevator pitch that I can say about myself next time in a conference, for me this indicates very clearly a significant product market fit for fungibles on Bitcoin, especially for standards that align with the core principles of the primary chain. If it required me being in the arena trying stuff to uncover this, then that's both hilarious and cool.
Edit: Just before I published this, the market cap of BRC-20 tokens is now *over* $1.5billion after breaking the record of 500k inscriptions registered in a single day (12th November, 2023)
B: Looking beyond, there is now an undeniable ecosystem of builders involved in the Bitcoin network who weren’t here before. What excites you now?
D: I'm thrilled about the next chapter of Bitcoin, recently dubbed "Bitcoin Season 2". Ordinals have ushered in a new wave of enthusiasts eager to innovate and experiment. The era of seeking permission from core developers or engaging in discussions about niche lifestyle choices is behind us. I firmly believe that metaprotocols will drive this era of innovation, and we've only begun to explore their potential. Without the distractions of BRC-20, I'd be immersing myself in new and fun protocol development. That's precisely why we established L1F: to realize this vision and foster collaboration with other forward-thinkers.
Edit: Since talking with Domo for this article, he has partnered with the first ordinals liquid fund; Unbroken Chain focusing on investing in interesting inscriptions, rare satoshis, and tokens all on the Bitcoin network.
B: You’ve recently unveiled the “Layer 1 Foundation” which in your own words was made with the intention of “becoming the hub for metaprotocol discourse and development.”
Can you elaborate more on what people and builders can see from this initiative and if there are any “milestones” you’re aiming for?
D: The Layer 1 Foundation aspires to be the nexus for metaprotocol discussions and advancements on Bitcoin. Recognizing the intricacies of BRC-20 and other metaprotocols, we've designed a dynamic framework suited to accommodate multiple standards.
The L1F Forum is a central hub for metaprotocol discussions on Bitcoin's evolution, while our inclusive development strategy invites wide-ranging contributions, overseen by trusted maintainers to ensure consistent standards of growth. Our goal is to be the go-to destination for all things metaprotocol, and we wholeheartedly welcome collaboration from standard curators and budding contributors alike.
B: Seeing what happened with the Ethereum network in the Bullrun in terms of dApps and its impact on gas, what do you see the future of dApps being built on the Bitcoin network to look like?
D: Bitcoin faces a potential challenge with the reducing block subsidy, leading to concerns that transaction fees might not adequately secure the network. Meta-protocols have the potential to solve this issue by providing consistent fees to miners, thus undoubtedly benefiting the network. However, while fee-paying protocol users might prefer some activity shift to rollups and sidechains (akin to Ethereum's transition to L2 solutions), I believe that Bitcoin's L1 will remain essential for asset issuance and custody due to its inherent security and resistance to censorship.
Since the creation and subsequent finishing of the article, the ecosystem in Bitcoin has gone exponential as you have seen with the ATHs for the BRC-20 tokens going past their previous All-Time Highs (ATHs) breaching $1.5bn and there are now a lot more projects on-chain to explore. We’ve seen PFP collections such as “Bitcoin Frogs” achieving over 620 BTC in secondary sales, “Taproot Wizards” (Co-founded by the biggest PageOne fan, Udi Wertheimer) securing a $7.5m Seed Raise and have even seen at the first attempts of a scaleable infrastructure with “Multibit” launching a bridge for cross-chain interoperability. The future of the Bitcoin ecosystem is looking bright.
I’d like to give a massive thank you to Domo for this retrospective and for putting up with my barrage of questions. I’d also like to thank Tolks & Tervo for help with editing this article.
If you’ve made it this far, thank you for reading and I hope this has been an useful read. You can follow me on Twitter to let me know what you thought about this post and don’t forget to subscribe to Page One for your essential crypto readings.