DRC-20 Tokens: Setting New Height for Dogecoin Daily Transactions

• DRC-20 tokens are digital fungible assets that operate over Dogecoin’s blockchain, similar to ERC-20 tokens based on Ethereum.
• Their increasing popularity results in a surge in Dogecoin’s daily transaction volume, surpassing the daily transaction volume of Bitcoin and Litecoin.

These tokens open up great opportunities in the blockchain space, but they also give rise to the creation of low-quality coins over Dogecoin’s blockchain. For instance, BRC-20, a token standard for Bitcoin, has emerged recently with a major drawback of low speed and high transaction fees. This problem creates space for new market players to introduce alternatives with affordable and fast-speed transactions.

What is DRC-20?

DRC-20 is a token standard that operates on the Dogecoin network, similar to Ethereum’s ERC-20. This token standard provides liquidity and enhanced capability to interact with various DRC-20 associated services and tokens. These standards enable features and diverse functions like user incentives and fulfill interchangeability of digital assets.

With native digital artifacts and the storage of arbitrary content, DRC-20 is unique and does not require side chain deployment and separate tokenization. Digital artifacts can be inscribed into smaller units known as elons. Due to this uniqueness, it enables the creation of both fungible and non-fungible tokens easily.

Advantages of DRC-20

Despite being in its development stage, DRC-20 still provides some major benefits.

• Early-Bird Access

The major advantage of DRC-20 is its early stage provided perks and benefits. Being an initial platform, it gives users space and opportunities to explore its full potential. Early users can benefit by exploring new projects, growth avenues, and partnerships.

• Cost-Effective

DRC-20 proves to be beneficial for users concerned about transaction fees. With this standard, minting new tokens incurs a comparatively low cost, enabling opportunities for experimenting and trying different minting options while reducing financial risk. It facilitates users who want to create their own token on this blockchain at a very low fee.

Cons of DRC-20

Being a newly developed platform also brings some hurdles. Some concerns to keep in mind before accessing DRC-20 are:

• Lack of Marketplace

At this time, there is no specifically tailored marketplace available for DRC-20. This imposes restrictions on buying and selling these tokens, affecting the scalability and liquidity of this platform. The lack of a well-established marketplace makes accessibility limited.

• Limited Infrastructure

As a newly established standard, there is no dedicated explorer available yet, leading to no track record of transactions and token inscription.

• Safety Concerns

Due to the lack of a tracking mechanism, validating and authenticating minting of DRC-20 can be problematic. Without a reliable system, there may be challenges in validating the legitimacy of newly created tokens.

Conclusion

The cryptocurrency market is setting new heights day by day, and everyone is racing towards being the best. It’s important to consider every token or technology’s pros and cons before investing or trading. As DRC-20 is a newborn technology, it has its own advantages and disadvantages as well. Some denizens thought that this standard is disrupting Dogecoin’s transactions, while some users believe DRC-20 may cause network congestion.