The BRC-20 token protocol, a standard for issuing fungible tokens on the Bitcoin blockchain via the Ordinals protocol, has upgraded to BRC2.0, integrating Ethereum Virtual Machine (EVM) compatibility at Bitcoin block height 912,690 on September 1, 2025.
This upgrade, developed by Best In Slot in collaboration with BRC-20’s pseudonymous creator Domo and the Layer 1 Foundation, embeds EVM functionality into the BRC-20 indexer, transforming it from a simple “calculator-style” system into a Turing-complete environment capable of executing complex smart contracts.
This enables developers to deploy Ethereum-style smart contracts and decentralized applications (dApps) directly on Bitcoin’s Layer 1, leveraging Bitcoin’s security and decentralization without requiring bridges or wrapped assets. BRC2.0 allows Bitcoin-native tokens, like ORDI and SATS, to become programmable, supporting use cases such as decentralized finance (DeFi), lending, trading, and tokenized real-world assets.
The upgrade also ensures compatibility with Ethereum’s development tools, such as Solidity, facilitating easier migration of existing EVM-based projects. Phase 1, completed in September 2025, introduced 6-character token namespaces for new programmable tokens, while Phase 2, expected around September 17, 2025, at block height 914,888, will make existing BRC-20 tokens programmable via a permissionless deposit process.
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Since its 2023 launch, BRC-20 has seen over $3 billion in asset volume, primarily from meme coins, but BRC2.0 aims to shift focus toward robust DeFi ecosystems. UniSat Wallet has already integrated BRC2.0 support, signaling early adoption. However, scalability and security challenges remain, given Bitcoin’s limited transaction throughput, which could impact widespread adoption.
BRC2.0 transforms Bitcoin’s Layer 1 into a platform for complex smart contracts and dApps, moving beyond its traditional role as a store of value. This enables Bitcoin-native DeFi, tokenized assets, and programmable tokens without intermediaries like bridges or wrapped assets, leveraging Bitcoin’s unmatched security and decentralization.
By supporting Ethereum’s development tools (e.g., Solidity), BRC2.0 lowers the barrier for Ethereum developers to build on Bitcoin. This could attract a wave of dApps and developers, fostering innovation and expanding Bitcoin’s utility in Web3 ecosystems.
EVM compatibility allows seamless integration of Ethereum-based projects into Bitcoin’s network, potentially increasing the total value locked (TVL) in Bitcoin DeFi. The $3 billion in BRC-20 asset volume since 2023 could grow significantly as programmable tokens enable sophisticated use cases like lending, trading, and yield farming.
Bitcoin’s limited transaction throughput (7–10 transactions per second) and high fees during network congestion could hinder BRC2.0’s scalability for high-frequency dApps, potentially limiting adoption compared to faster chains like Ethereum or Solana.
Introducing Turing-complete smart contracts on Bitcoin’s Layer 1 could expose the network to new vulnerabilities, such as smart contract bugs, which have historically plagued EVM-based chains. Bitcoin’s conservative design prioritizes security, so community acceptance may hinge on rigorous auditing and testing.
Programmable BRC-20 tokens (e.g., ORDI, SATS) could see increased demand, driving price volatility and trading activity. The shift from meme-driven assets to DeFi-focused applications may attract institutional interest, but speculative fervor could dominate in the short term.
Early support from UniSat Wallet signals ecosystem readiness, but broader adoption depends on exchanges, wallets, and indexers integrating BRC2.0. The phased rollout (Phase 2 expected by September 17, 2025) ensures gradual implementation, minimizing disruption but delaying full ecosystem impact.
BRC2.0’s Layer 1 approach competes with Bitcoin Layer 2 solutions like Lightning Network or Stacks, which also aim to enable smart contracts. Its success will depend on whether developers prioritize Bitcoin’s base-layer security over Layer 2 scalability.