SATS Coin Analysis: Changes in Fundamentals and Market Performance

Since Bitcoin bottomed out and rebounded on July 5, the increase of SATS has exceeded 200%, not only performing the best in the inscription track but also ranking among the top in the overall market rebound. This performance is mainly attributed to the significant changes in the fundamentals of SATS and the rise after long-term capital accumulation. In the next two months, SATS is likely to become one of the key targets worth focusing on in the Bitcoin ecosystem.

1. SATS is determined as Gas fees

A certain trading platform is developing a BRC20 exchange module, which is planned to be launched on the Bitcoin mainnet and its self-developed Layer 2 network. While the release date for the exchange feature on the mainnet has not yet been determined, the exchange feature on the Layer 2 network is expected to go live in September of this year.

The platform clearly states that by integrating wallets, browsers, and exchange products, it aims to provide a seamless experience for the Bitcoin mainnet and layer two networks. From the user's perspective, the main advantages of layer two network exchanges 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

Development of BRC20 exchange module 2.1

The core goal of the brc20 exchange module is to enable other teams to build their own exchange platforms based on the existing code. This will standardize and unify brc20 asset trading that previously relied on centralized, information-asymmetric indexers.

Currently, most of the work on the exchange 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.

2.2 New Network Based on BRC20 Standard

The new network aims to expand the Bitcoin network through the brc20 standard. On this network, products with the same functionality as the mainnet exchange module will be provided, ensuring that projects on the network have good liquidity from the start. In the future, BTC and other mainnet assets can also exist as brc-20 wrapped assets on this network, providing greater flexibility.

In addition, the new network will implement a competitive rollup mechanism that allows users to package the aggregated results into the sequencer, thus earning transaction fees (brc-20 sats). This process is similar to miners submitting packaged transactions to the network and receiving block rewards, further establishing sats as the network's gas fee.

2.3 PIZZA inscription large-scale airdrop

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.

The eligibility criteria include:

• Addresses that have interacted with platform services within 3 months
• Addresses holding more than 500 platform points
• There are interactive addresses within the brc20 exchange module
• Specific pass holders

PIZZA has now become one of the most held assets in BRC20 and Rune.

Through these new measures, relevant platforms are striving to bring BRC20 assets back to the forefront of the Bitcoin ecosystem.

3. Data Analysis of SATS

3.1 Comparison of Holders and Market Value

Among the popular brc20 assets, PIZZA has the most holders but the lowest concentration of chips. SATS has the highest proportion of first addresses and a relatively large number of holders, surpassing ORDI and RATS in terms of chip concentration and holder consensus, but has a smaller market capitalization than ORDI.

3.2 Chip Distribution

From the weekly chart, SATS has continued to decline for about 4 months since its rally at the end of February. The bottom cost for some exchanges is around 0.00018. Currently, it is the second week of a bottom rise, challenging the previous high trading area near 0.0003, with the next high trading area around 0.0005.

3.3 Contract Data

The contract data on July 17 shows that the account long-short ratio is 0.751, and the large holder's long-short ratio is 1.6425, indicating a higher proportion of long funds. The rapid rise within 24 hours mainly liquidated short positions. In the liquidation map, after the liquidation of short positions at 0.000225 and 0.00024 with 1000 SATS, there have not been many new short positions formed above 0.00028.

4. Summary

1. The positioning of SATS has changed, becoming the gas fee for brc20 exchanges on the Bitcoin mainnet and the new network. In addition to its meme properties within the Bitcoin ecosystem, SATS now has actual token use cases. With the development and promotion of related products, its usage scale is expected to expand rapidly.

2. Time and price nodes are still expected. The new network is expected to officially launch in September, and the real landing and use of SATS as gas fees will continue until after September. Based on the accumulation time and the increase of the K-line, SATS has further price increase potential in the coming months, alongside a positive market trend.

3. The 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. In addition, there is a competitive relationship between the Bitcoin solutions of brc20 and the UTXO+runes solution. Recently, the UTXO exchange based on RGB++ was also launched on the mainnet, and it is necessary to pay attention to whether there is a situation of capital conversion between the two in the medium term.