Analysis of the Latest Developments and Market Performance of SATS Inscriptions

Since Bitcoin's bottom rebound on July 5th, the increase in SATS inscriptions has exceeded 200%, making it one of the best-performing assets in the inscription sector. Behind this outstanding performance are significant changes in the fundamentals of SATS and long-term capital accumulation. Over the next two months, SATS is likely to remain an asset worth focusing on within the Bitcoin ecosystem. This article will review and analyze the recent important changes in SATS.

1. SATS established as Gas fee

A well-known wallet platform is developing a BRC20 exchange module, which is planned to be launched on the Bitcoin mainnet and the platform's self-developed Layer 2 network. Although the release date for the exchange function on the mainnet has not yet been determined, the exchange function on the Layer 2 network is expected to go live in September this year.

The platform clearly stated in an article released on July 7 that they aim to provide a consistent user experience for the Bitcoin mainnet and layer two networks. The main advantages of layer two networks are faster confirmation speeds and lower overall costs. Both are based on the brc-20 protocol and use brc-20 SATS as gas fees.

2. New Development Directions

2.1 Development of the brc20 swap function

The core goal of the brc20 exchange function is to allow other teams to build their own exchange platforms based on the code of this platform. This will make the trading of brc20 assets more standardized and unified.

Currently, most of the work on the exchange module has been completed, and the remaining tasks mainly include:

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

A new network based on the BRC20 standard 2.2

The platform is developing a new network based on the BRC20 standard, aimed at expanding the functionality of the Bitcoin network. On this new network, products will be offered with the same functionality as the mainnet exchange module, ensuring that projects on the new network have good liquidity from the start. In the future, Bitcoin and other mainnet assets can also exist as BRC-20 wrapped assets on the new network, providing greater flexibility.

The exchange function on the new network will implement a competitive rollup mechanism, allowing users to submit aggregated results to the sequencer, thereby earning transaction fees (brc-20 sats). This process is similar to miners packaging transactions and submitting them to the network to receive block rewards, further establishing sats as the network's gas fee.

2.3 Large-scale airdrop inscription

The platform previously launched a new inscription to commemorate Bitcoin Pizza Day and airdropped it for free to platform users. Unlike previous public minting, users could claim it without any additional fees. At that time, over 200,000 addresses participated in the claim.

The application requirements include:

• Addresses that have interacted with the platform services within 3 months
• Addresses holding more than 500 platform points
• There are interactive addresses within the brc20 exchange module.
• Special Access Pass Holders

This new inscription has become one of the most held assets in BRC20 and Rune assets.

Through these three new directions, the platform strives to push BRC20 assets back to being the focus of the Bitcoin ecosystem.

3. Market Data Analysis of SATS

3.1 Comparison of Holders and Market Value

Among popular brc20 assets, the number of holders for the above new inscriptions is the highest, but the concentration of chips is the lowest. SATS has the highest proportion of first addresses and a larger number of holders, with higher chip concentration and holder consensus compared to other major competitors, but its market value is still lower than that of some competing products.

3.2 Chip Distribution

From the weekly perspective, SATS has been continuously declining for about 4 months after rising at the end of February. The bottom cost of some exchanges' positions is around 0.00018. Currently, SATS is challenging the previous trading concentration zone of 0.0003, with the next concentration zone around 0.0005.

3.3 contract data

The contract data on 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 rise within 24 hours mainly liquidated short positions. In the liquidation map, after the SATS liquidated short positions at 0.000225 and 0.00024, there has not yet been a large formation of new short positions above 0.00028.

4. Summary

1. The positioning of SATS has undergone a significant change, becoming the gas fee for BRC20 exchange functionality on the Bitcoin mainnet and new networks. This gives SATS a practical use case beyond the meme attributes in the Bitcoin ecosystem, and as the platform's product development and promotion progress, its usage scale is expected to expand rapidly.

2. SATS still has time and price expectations. The new network is scheduled to officially launch in September, and the practical implementation and use of SATS as gas fees will continue after September. From the price trend, SATS may have further upward potential in the coming months as the overall market improves.

3. The risks of SATS may arise from the underlying funding attributes and competition within the horizontal track. The funding behind BRC20 is still primarily from Eastern sources, and there is a competitive relationship between the Bitcoin solutions of BRC20 and other solutions. Recently, the UTXO exchange function based on RGB++ has also been launched on the mainnet, and in the medium term, attention should be paid to whether there is a transfer of funds between different solutions.