Bitcoin Runes, the new fungible token protocol which was launched towards the middle of the previous month has now surpassed Bitcoin crypto, Bitcoin Ordinals, and the BRC-20 tokens in daily transactions in the Bitcoin network.
Let us read more about the dominance of the Runes protocol in the Bitcoin network.
3 days after its launch, the protocol managed to make around 81.3% of transactions, its highest transaction so far.
This leap of Bitcoin Runes has pulled down Bitcoin’s transaction rates to 18.15% while Ordinals and the BRC-20 tokens only recorded 0.1% of the total transactions.
However, Runes did not maintain this high translation rate in the following days. In the days that followed after its highest daily transaction, the transaction rates gradually fell.
However, in the recent days of the month of May, the protocol seems to be attempting to make a comeback clocking around 60% of the total transactions per day that were made on the Bitcoin network.
The Bitcoin mining community can be said as one of the major beneficiaries of this high run. The community was able to make 2253 BTC in fees alone within 16 days.
There are also suggestions that the current popularity that Runes protocol has in the market, can result in higher network fees, however, nothing related to it has been announced so far.
Runes Protocol And Bitcoin Halving
The launch of the Bitcoin Runes protocol nearly collided with the Bitcoin halving event. Bitcoin halving took place in the last month, April 2024, protocol launch on April 20, and Bitcoin halving on April 19.
Following the Bitcoin halving event, the mining community has faced significant drops in their earnings. The halving events in total pushed down the total revenue that the community could make from mining.
Many of the miners reported that they had to upgrade tier mining equipment to improve their mining performance.
The upgrade of the mining equipment was costly, but they had to do it to reduce the operating costs. It is expected that this upgrade will yield profit.
The latest reports suggest that the gross revenue for Bitcoin miners has collapsed to a value below 30 million US dollars per day in May alone, so far.
The dominance that Runes Protocol currently has in the market may help the miners to make some huge profits.
Also, the Bitcoin halving event persuades the miners to improve their performance and optimize their mining activity to make high amounts of money.
What Is Bitcoin Runes?
Bitcoin Runes is a protocol and serves as an experimental standard introduced for the fungible tokens that are built on the Bitcoin blockchain.
The protocol was created with the aim of boosting the effectiveness of the BRC-20 tokens. Further fungible tokens on the Bitcoin blockchain will be issued based on this protocol. It was launched on the 20th of April on block 840,000.
It was in September 2023 that Casey Rodarmer, a Bitcoin developer, proposed the Runes protocol. The aim of the proposal was to heighten the token standard for the fungible assets that get issued on Bitcoin.
Bitcoin Runes: Features
- Runes is a minimal protocol that has a simple on-chain footprint
- The protocol will turn responsible for the UTXO management (Unspent Transaction Outputs)
- It will not produce excessive junk UTXOs on the Bitcoin network
- The protocol is supposed to declutter the junk UTXO currently on the network
- It stands to increase the efficiency of the BRC-20 token standard which is presently based on Ordinals
- Since it relies on on-chain data, the protocol is expected to be far better than tether fungible taken protocols that Bitcoin has now like Taproot Assets and RGB
- Storing the data on-chain will not make it detached from the main layer of the Bitcoin network
- The protocol does not need a native token to operate
- Runes protocol is more user-friendly
The reason why the creator of the Bitcoin Runes protocol introduced it was because he believed that the asset-issuing standard could be more user-friendly and efficient.
The features of the protocol do give the impression that it can resolve many of the issues that currently exist on the Bitcoin network.
