SATS: Highlights worth following in the BTC ecosystem

Since Bitcoin hit bottom and rebounded on July 5, SATS has risen by more than 200%. It has not only performed outstandingly in the inscription track but also ranks among the best in the overall market. This strong performance is attributed to significant changes in the fundamentals of SATS, as well as the market reaction after long-term accumulation. In the next two months, SATS is likely to continue being one of the focal points in the BTC ecosystem. This article will review and analyze the latest developments of SATS.

1. SATS Establishes the Role of Gas Fees

A certain trading platform is developing a brc20 swap module, planning to launch it on the Bitcoin mainnet and its self-developed layer two network. Although the specific release date for the swap on L1 has not yet been determined, the layer two network swap is expected to go live in September this year.

The article introducing the Swap module released by the platform on July 7 clearly states that its goal is to provide a unified user experience for the Bitcoin mainnet and layer two networks. The main advantages of the layer two network Swap are faster confirmation speeds and lower overall fees. It is worth noting that both versions will be based on the brc-20 protocol and use brc-20 sats as gas fees.

2. The Launch of the New Narrative

2.1 Development of brc20Swap

The core goal of brc20 Swap is to provide a foundation for other teams to build their own exchange platforms. This will transform brc20 asset trading from relying on centralized, information-asymmetric indexers to a standardized and unified model.

Currently, most of the work on the swap module has been completed, and the remaining work mainly includes:

• Assist other indexers in effectively identifying and calculating inscriptions related to the exchange module.
• Ensure that the calculation results are consistent with other teams to avoid accounting discrepancies.

New Network Based on BRC20 Standard 2.2

The new network aims to expand the Bitcoin network through the BRC20 standard. On this network, products with the same functionality as the mainnet swap module will be offered, ensuring that projects have good liquidity from the beginning. In future iterations, BTC and other mainnet assets can also exist as BRC-20 wrapped assets on the new network, providing greater flexibility.

The new network's Swap will implement a competitive rollup mechanism, allowing users to package the summary results to the sequencer, thereby earning transaction fees (brc-20 sats). This process is similar to miners submitting packaged transactions and receiving block rewards, further establishing sats as the network's gas fee.

2.3 large-scale airdrop of PIZZA inscriptions

The PIZZA inscription was launched to commemorate the 14th Bitcoin Pizza Day and was airdropped for free to platform users. Unlike previous public minting, users can claim it without any additional fees. Over 200,000 addresses participated in the claim, and the conditions for claiming include:

• Addresses that have interacted with the platform services within the last 3 months
• Addresses holding more than 500 platform points
• There are interactive addresses within the brc20-swap module.
• Platform OG Pass holders

PIZZA has now become one of the assets with the most holders in brc20 and rune assets.

Through these three new narratives, the platform strives to bring BRC20 assets back to the focus of the BTC ecosystem.

3. SATS Data Tracking

3.1 Comparison of Holders and Market Value

Among the popular BRC20 assets, PIZZA has the highest number of holders but the lowest concentration of chips. SATS has the highest proportion of first addresses and a larger number of holders, outperforming other assets in terms of chip concentration and holder consensus, while its market cap is smaller than some competitors.

3.2 Chip Distribution

From the weekly perspective, SATS has been continuously declining for about 4 months since its rally at the end of February. The bottom cost for some positions on the exchange at 1000 SATS is around 0.00018. It has now emerged from the trend and is currently challenging the trading congestion area near 0.0003, with the next congestion area around 0.0005.

3.3 contract data

The contract data from July 17 shows that the account long-short ratio is 0.751, while the large holder's long-short ratio is 1.6425, indicating a higher proportion of bullish funds. The rapid surge within 24 hours primarily exploded short positions. In the liquidation map, after the explosion of short positions at 0.000225 and 0.00024, there have not yet been a large number of new short positions formed above 0.00028.

4. Summary

1. With the update of the new narrative, SATS has gained actual token use cases while possessing the meme attributes of the BTC ecosystem. As the gas fee for brc20 swap on the Bitcoin mainnet and the new network, its scale is expected to expand rapidly with product development and promotion.

2. The time and price nodes are still expected. The new network is expected to officially launch in September, and the real implementation and use of SATS as a gas fee will continue after September. Based on the accumulation time and price increase amplitude from the K-line, SATS still has further price expectations in the coming months alongside a favorable market.

3. The potential risks of SATS may arise from the underlying capital attributes and competition in the horizontal track. The funding behind brc20 is still primarily from Eastern capital, and there is a competitive relationship between the Bitcoin solutions of brc20 and the utxo+runes solution. Recently, the UTXO swap based on RGB++ has also gone live on the mainnet, and in the medium term, attention should be paid to whether there is a capital conversion between the two that would lead to one gaining at the expense of the other.