A blockchain developer, known as Mikael.btc, is set to fork the BRC-20 token standard to introduce decentralized finance capabilities to the Bitcoin network. Mikael.btc, the creator of the BRC-100 token standard, aims to enhance Bitcoin’s functionality by addressing key limitations of the BRC-20 standard such as its lack of programmability, scalability challenges, and the absence of DeFi infrastructure.

Introducing BRC-100: Enhancing Bitcoin with DeFi Capabilities

In an August 9 post, Mikael.btc outlined plans for the fork, emphasizing the need for DeFi infrastructures on the Bitcoin network. The proposed upgrade will leverage technologies such as Inscriptions and OP_RETURN to enable users to access decentralized finance.

“Every BRC-20 token will be mapped to a BRC-100 token with the same ticker and the same supply. 100% of the new BRC-100 token will be distributed to the holders of the original BRC-20 token, with the exactly same amount as the holdings on BRC-20.”

Following the fork, holders of BRC-20 tokens will automatically receive equivalent assets on the BRC-100 protocol. However, those with BRC-20 tokens held on centralized exchanges will need to wait for the exchanges to distribute the new forked assets.

Why This Matters for Bitcoin and DeFi

The push for DeFi on the Bitcoin network has gained momentum. A research report from a prominent crypto venture capital firm projected that the Bitcoin-based DeFi ecosystem could attract significant liquidity through web3 protocols. This implies that Bitcoin’s DeFi sector could achieve a market share comparable to that of Ethereum’s.

Key Takeaways for Investors

  • Enhanced Functionality: The new protocol will improve Bitcoin’s programmability and scalability.
  • Automatic Token Mapping: BRC-20 token holders will automatically receive equivalent BRC-100 tokens.
  • DeFi Potential: The upgrade could attract substantial liquidity, boosting Bitcoin’s DeFi sector.

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