Tokenization is a key part of Web3 as it allows the representation of nearly anything of value on the blockchain. But tokenization isn’t possible without token standards, rules that oversee how a token works by itself and within the network.
A new addition to the existing standards is DRC-20, a new token standard for Dogecoin, the largest meme coin on the market. But what is DRC-20, and how do you mint a DRC-20 token?
What Are Token Standards?
Like each organization has rules to govern its practices, blockchain networks create token standards that govern how tokens on that network should function. Token standards do more than manage how a token works; if a token does not conform to the standards of that network, certain features are compromised.
For instance, token standards allow tokens to interact seamlessly with products on the network, such as wallets, DApps, and smart contracts.
What Is DRC-20?
DRC-20 is a token standard on the Dogecoin network that allows users to mint tokens. Developed similarly to the Bitcoin BRC-20 standard, the DRC-20 standard will allow users to tokenize assets and create NFTs on the Dogecoin network.
Launched in May 2023, the DRC-20 token standard can be used to create tokens that are entirely compatible with the Dogecoin network at a very low cost in comparison to the cost of gas fees for minting on other blockchains such as Ethereum and the Binance Smart Chain.
How Do DRC-20 Tokens Work?
DRC-20 and its BRC-20 are token standards that make creating a digital asset on the blockchain possible. The BRC-20 token standard was designed for the Bitcoin network, and DRC-20 is modeled after it.
BRC-20 tokens on the Bitcoin network are called Ordinals, and they are made by inscribing a Satoshi (atomic unit of Bitcoin) with customized metadata. In the same way, DRC-20 tokens, known as a Doginal, are created by inscribing a Shibe (fraction of Dogecoin) with personalized metadata. Inscription here means attaching customized metadata to a Shibe. This metadata can be anything under 4MB, from a JPEG file to an app or a game.
Inscribing a Shibe is what makes it a separate token. You can mint your own DRC-20 token using a minting project. Once minted, the tokens will be deposited in your wallet. All DRC-20 tokens start at a value of $0, and because the DRC-20 token standard is still fresh, no marketplaces are available for listing tokens.
How to Mint DRC-20 Tokens
The process for minting a token is mostly generic, asides the small differences in the various token standards, which may affect the minting process. Here’s how to mint your token, per the DRC-20 token standard.
1. Set Up Your Wallet
To perform any transaction in DeFi, you need a network-compatible wallet. A wallet will allow you to interact with smart contracts, mint tokens, and, more importantly, mint tokens. So before you can mint a DRC-20 token, you need a compatible wallet.
- Visit DPAL Wallet and install the extension to your web browser.
- After downloading the extension, click on it and follow the prompts to set up your account.
- You must set a password and input a mnemonic phrase (ensure you save this).
Once your wallet is set up, you’re ready to start the minting process.
2. Fund Your Wallet
Like ETH is the utility coin of Ethereum, Dogecoin is the utility coin of the Doge network. When minting a token, you need to pay transaction fees in DOGE. To mint a DRC-20 token, you don’t need a lot of Doge; around 5-10 DOGE is enough. There are different crypto exchanges where you can buy Dogecoin.
Copy your DPAL Wallet address, which you will find at the top of the DPAL Wallet interface, then input it in the withdraw page on the CEX or DEX where you’ve bought your DOGE. You should receive the DOGE in your wallet after a few minutes.
3. Mint the DRC-20 Token
Now that you’ve gathered enough Doge in your wallet, you can move to the next stage. Start by clicking on the DPAL extension and unlocking your wallet.
First, extend the menu by clicking the icon in the top right corner of the wallet interface, then select Doginals (Ordinals) among the options provided in the drop-down.
You’ll be presented with two more options, select Mint Ordinals (Experimental). At this stage, you need to inscribe your token. An inscription code is just like a simple HTML code, and it contains four key things:
- p (protocol): The network or blockchain on which the code runs.
- op (operation): type of blockchain event. Common events are deploy, transfer, and mint.
- tick (ticker): a word or combination of four characters to identify the token, like “Pepe” and “Doge.”
- amt (amount): total number of tokens to be minted.
A standard inscription code looks like this:
{ "p": "drc-20", "op": "mint", "tick": "piza", "amt": "1000" }
This code details the number of tokens to mint and the type of operation.
Because you’re trying to mint DRC-20 tokens, the only changes you’ll make are to identify the token and set the amount to be minted. The DPAL wallet interface makes this easy by letting you fill in these two keys without editing the standard inscription code.
After that, click ok to complete the inscription process, then confirm the transaction and receive your tokens.
Now you’re almost done. To finish up, you need to confirm your transaction. Input your wallet password to confirm the transaction and receive the DRC-20 tokens in your wallet. You can find your minted tokens under the Mint history.
Other DRC-20 Minting Projects
Apart from DPAL Wallet, the only other minting project for the DRC-20 token standard is DRC-20’s website. Because the token standard is still new, many developers are still working to create projects for different operations.
Like DPAL Wallet, DRC-20 has a browser extension wallet, but you can also mint tokens directly on the website.
To mint on the DRC-20 website:
- Visit DRC-20 and click Mint on the top menu.
- Select the token you’d like to mint on the Mint page from the options available and your wallet address.
- After that, specify the number of tokens to mint and confirm the transaction.
- After confirming, you’ll need to pay for the transaction. You can pay with Doge using the wallet address you entered earlier or scan the QR code to pay with your credit card.
- You should receive the newly minted token in your Dogecoin wallet.
Picking between both minting projects depends entirely on your preferences. If you don’t have any Dogecoin in your wallet, DRC-20 is a better option because it has a credit card payment option.
On the flip side, DPAL Wallet allows you to create a unique ticker instead of selecting from a range of options as it is on DRC-20. Also, DPAL does not appear to have a limited maximum minting amount, as you can mint up to 50 million tokens. On the other hand, the maximum mint amount on DRC-20 is 20 million tokens.
DRC-20 Tokens vs. ERC-20 Tokens
While ERC-20 is the token standard for Ethereum, DRC-20 is a token standard for the Dogecoin network. Both ERC-20 and DRC-20 allow users to mint assets on the respective network.
The major difference between DRC-20 and ERC-20 is each token standard’s technical details and implementation. The DRC-20 token standard mirrors the BRC-20 token. Dogecoin users create Doginals by inscribing a Shibe, just as Bitcoin users create ordinals by inscribing Satoshis. In both cases, the inscribed tokens are still the same as Bitcoin and Dogecoin, only in smaller units. On the other hand, minting an ERC-20 token creates an entirely different token, separate from Ether.
Another difference is the method of minting tokens under both standards. Minting and deploying an ERC-20 token is a complex process that involves several technical steps. To mint an ERC-20 token, you need an Ethereum wallet like Metamask, knowledge of programming languages like Solidity, and other developer tools like Alchemy and Hardhat.
The process involves writing and deploying a smart contract on the appropriate network, that is, if you want to create an ERC-20 token that actually does something useful. In comparison, minting DRC-20 tokens is made easy with tools like the DPAL Wallet and DRC-20, as there is no need to write any code.
Another difference between both token standards is the gas fees on the network. The cost for mining a token on the Doge network stands at 0.1 Doge, less than a cent in US currency. In comparison, Ethereum transaction fees range from $0.71 to $7, according to DeFi Prime.
Should You Mint or Buy DRC-20 Tokens?
There are several reasons why you might want to use DRC-20 tokens. They include compatibility with the Dogecoin network, interoperability, and the relatively low cost of gas fees on the network. But when it comes to investing, caution is advised.
The DRC-20 standard shifted some attention to the Dogecoin network and ushered in some growth, but investing in DRC-20 tokens should only be done after you have done your research.
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