The BTC ecosystem welcomes a new era of smart contracts

Recently, Fractal BTC officially launched its mainnet in September after multiple testnet operations. One of the highlights of Fractal is its ability to support smart contracts, and it introduced a new token protocol CAT20 alongside the mainnet launch. This technological innovation brings new possibilities to the Bitcoin ecosystem.

Fractal Bitcoin Overview

Fractal Bitcoin, also known as 分形比特币, is a fully compatible second-layer network with BTC. Compared to BTC, it has a faster block confirmation time of just 1 minute. Its basic principle is to replicate the BTC network multiple times, with each chain capable of processing transactions, thereby increasing the overall processing speed.

A major breakthrough of Fractal Bitcoin is that it has enabled the OP_CAT opcode, which was abandoned in the early days of BTC for security reasons. This gives Fractal Bitcoin the capability for smart contracts, opening up more possibilities for ecological development.

Introduction to the CAT20 Protocol

Based on the underlying support of Fractal Bitcoin, the CAT Protocol has emerged. The CAT20 protocol, which has already been implemented, is functionally similar to Ethereum's ERC20 standard.

The deployment process of CAT20 is divided into two stages: "commit" and "reveal". In the commit stage, the basic information of the token is written into the transaction output script. The hashId of the commit transaction serves as the unique identifier for the token. The reveal stage outputs the initial state Hash of the token and the Minter used for subsequent Minting.

During the Mint process, each transaction uses one minter as input, and the output can include multiple new minters. This design allows the number of available minters to be dynamically adjusted to balance network congestion and economic costs.

The transaction construction of CAT20 employs a clever script design, allowing users to control UTXOs that seemingly do not belong to their own address. This design provides greater flexibility for transactions.

Features and Advantages of CAT20

1. State Management: CAT20 stores state information in OP_RETURN and smart contracts, including remaining Mint times, etc.

2. Token Storage: Unlike BRC20 or inscriptions, CAT20 tokens do not directly store on the user's address UTXO, but exist in the form of smart contracts.

3. Flexibility: All operations are constructed by the users themselves, providing great flexibility.

4. Query convenience: To check the token holding status, you only need to query the token's UTXO, without tracking historical transactions.

5. Mint status tracking: You can understand the current Mint situation by searching for transactions that include "cat" in the OP_RETURN.

The emergence of CAT20 has brought new possibilities to the Bitcoin ecosystem and opened the door for the application of smart contracts on the BTC network. Although it is still in the early stages, its innovative design has already shown great potential. As technology continues to improve and the ecosystem matures, we have reason to expect that CAT20 will bring more exciting application scenarios to the Bitcoin network.