How Ordinals, Inscriptions and BRC-20s Work — and How to Use Unisat Wallet Safely

Okay, so picture this: Bitcoin, the stoic base layer, suddenly gets expressive. Art, tiny programs, token-like experiments — all stitched directly onto sats. Wild, right? My first reaction was a mix of curiosity and a little skepticism. Something felt off about layering fungible-token ideas onto Bitcoin, but then I saw an inscription that was just… clever. It changed my view.

This guide walks through the core ideas — ordinals, inscriptions, and BRC-20 tokens — and gives practical, hands-on tips for using a popular browser extension, the unisat wallet, without getting burned. I’ll be honest: the space moves fast and sometimes feels experimental. Still, you can operate here responsibly if you know what to watch for.

Short version: ordinals index satoshis. Inscriptions write data to those satoshis. BRC-20s piggyback on inscriptions to implement token-like behavior. Long version follows.

What is an Ordinal (and why it matters)

An ordinal is, at heart, an addressing scheme. Each satoshi (the smallest Bitcoin unit) can be given an index number. By doing that, people can reference a specific sat and attach metadata or content to it. That attachment is called an inscription. Sounds small-scale, but it’s powerful because it uses Bitcoin’s settlement, not a sidechain.

Why care? Because inscriptions make Bitcoin a carrier for arbitrary data — images, text, tiny programs — and that opens doors for collectibles, provenance, and new permissionless experiments. On the other hand, it changes usage patterns for block space, which has implications for fees and node storage.

What an Inscription actually is

Think of an inscription as a payload written into a satoshi’s spending path. The data lives on-chain inside witness data (SegWit), so it’s verifiable and immutable once confirmed. That immutability is great for art or censorship-resistant records. But it also means the Bitcoin blockchain stores more arbitrary data than it used to.

Because inscriptions are embedded in transactions, every wallet, explorer, and node that reads them needs to parse certain fields. This parsing is what enables marketplaces and indexers to present inscriptions as “items” you can view or trade.

BRC-20 tokens: not quite ERC-20, but conceptually similar

BRC-20s are a lightweight, experimental standard that uses inscriptions to track token-like states. There’s no smart-contract VM here — instead, issuers write JSON metadata as inscriptions and rely on indexers to interpret them. That means the enforcement and behavior are off-chain social contracts enforced by tooling.

On one hand, this is elegant and minimal. On the other, you don’t get programmatic safeguards you’d expect in an EVM token. So trust the tooling and know that trading a BRC-20 can depend on the indexer or marketplace agreeing about supply and provenance.

Using the Unisat Wallet: practical tips

Unisat is one of the more widely used browser wallets for ordinals and inscriptions. It supports viewing and managing inscriptions, sending sat-bound items, and interacting with BRC-20 flows. If you’re new, set aside time to learn its UI and test with tiny amounts first.

Why I mention it here: real users I know rely on Unisat for day-to-day ordinal interactions. It’s convenient. But convenience comes with tradeoffs — particularly when you approve transactions that embed large inscriptions, which can be expensive.

Before you start, do a few simple things:

• Backup your seed phrase offline and never share it. Seriously—never.
• Test sending a small number of sats before you try to send an inscription or mint a BRC-20. Fees vary wildly.
• Check the exact transaction preview. If the payload or fee looks wrong, pause.

Gas (fees), mempool behavior and timing

Fees are the elephant in the room. Inscriptions can bloat witness size and push fees up. When the mempool is busy, you either pay more for fast inclusion or wait a long time. Sometimes inscription creators accidentally cause congestion — and that affects everyone.

Two practical rules: 1) use fee estimation tools and 2) be patient when network demand spikes. If you’re minting a BRC-20 and need a specific order, plan for variability. Also, avoid resubmitting identical large inscriptions during high-fee periods unless you mean to.

Indexers, marketplaces and custody

Because inscriptions require interpretation, marketplaces and wallets depend on indexers. That means you’re relying on third-party software to list, show and sometimes even validate items. Not ideal from a pure trustlessness POV, but it’s the reality now.

So when you buy an inscription or a BRC-20, know where it’s indexed and whether the marketplace uses robust, open-source indexers. If provenance matters, check that the transaction ID and sat index match the listing. If something bugs you, dig into the raw transaction — it’s Bitcoin, you can.

How minting a BRC-20 typically works (high-level)

There are many workflows, but the typical flow looks like this:

1. Issuer places JSON metadata in an inscription describing supply, tickers, and mint/cancel semantics.
2. Indexers detect the inscription and interpret it as an OP to create a token “series”.
3. Subsequent inscriptions can mint tokens by following the declared conventions and are recorded by indexers.
4. Marketplaces let people transfer and trade these token entries, again based on indexer views.

Because it’s a convention rather than a VM, interoperability depends on everyone following the convention closely. A small formatting difference can break recognition by some indexers.

Security and realistic risks

Don’t assume the same guarantees you get from chain-native smart contracts. Here are the main risks:

• Indexers disagreeing about supply or provenance.
• Accidental high fees or stuck transactions.
• Phishing wallets or fake marketplaces mimicking inscription listings.
• Loss of seed or compromised browser extension storage.

Mitigations: verify TX IDs manually, stick with well-known indexers/marketplaces, use hardware wallets if supported, and keep tiny test amounts when experimenting. Also, be mindful of how much arbitrary data you embed — both ethically and economically.