How to Get Into Bitcoin Runes With the Runes Launch at Halving
This week's Bitcoin (BTC) reward halving is a monumental occasion for both the crypto industry and users. Halving is a once-every-four-years event that always draws significant attention. However, the April 2024 event is special on an entirely new level, thanks to the highly anticipated launch of the Runes protocol, scheduled to go live right after the halving kicks in.
Runes is a revolutionary standard for creating fungible tokens on the Bitcoin blockchain. The standard is widely anticipated to set a new paradigm on the Bitcoin network, turning it into a thriving multi-asset ecosystem with significant trading and investment opportunities. Most importantly, Runes is vastly more efficient and user-friendly than BRC-20, an earlier Bitcoin fungible token standard.
Key Takeaways:
Runes is an efficient, lightweight token standard for creating fungible cryptocurrencies on the Bitcoin blockchain.
The Runes standard will go live right after the April 2024 Bitcoin halving event, when the protocol's creator, Casey Rodarmor, is expected to mint the first Runes tokens.
What Is Bitcoin Runes?
Runes is a new token standard and technology for creating fungible cryptocurrencies on Bitcoinâs blockchain. (This new token standard is not to be confused with RUNE, the native token of THORChain). It allows users to issue and manage fungible tokens using Bitcoin's unspent transaction outputs (UTXOs), which represent the outputs of standard Bitcoin transfers. The concept of Bitcoin Runes was introduced in September 2023 by Casey Rodarmor, the enigmatic developer who also created Bitcoin Ordinals.
Runes is widely expected to go live right after the Bitcoin halving event (scheduled to occur on Apr 18, 2024, it's estimated to actually occur on April 19 or 20). The first Runes token will most likely be issued by Rodarmor himself. Following that, it's expected that a large number of Runes tokens will appear on Bitcoin, quickly leading to a thriving trade and creating investment opportunities on a scale that Bitcoin has probably never seen before.
Back in 2023, Rodarmor's Ordinals technology opened up a unique way of creating Bitcoin-based NFTs. Runes will now usher in an era of fungible crypto tokens on the blockchain. While it's not the first fungible token standard for Bitcoin, it's estimated to be the first technology that facilitates an efficient and user-friendly way of creating Bitcoin-based cryptos.
Runes will introduce a lightweight method for creating fungible assets on Bitcoin, thanks to its utilizing the blockchain's native UTXO model. The process of creating and transferring Runes tokens involves attaching messages, called Runestones, to a Bitcoin transaction. As such, there's no need to create any additional UTXOs or other unnecessary elements on the network. By using ordinary UTXOs generated during Bitcoin transfers, Runes avoids placing any significant load on the network.
Which Projects Are Building on the Runes Protocol?
Although the first fungible Runes tokens won't appear on the network until after the halving event, some projects have already begun experimenting with the concept by introducing Runes-themed Bitcoin NFT collections based on the Bitcoin Ordinals protocol. Typically, these projects promise airdrops of their future fungible tokens to people who have purchased NFTs from their current collections.
Runestone
Runestone is one of the earliest and most popular Runes-themed projects. Itâs a Bitcoin NFT collection based on Ordinals, with each NFT depicting a 3D stone that has an ancient rune symbol inscribed on it.
There are 112,400 Runestone NFTs in the collection, and many of the items are listed for sale on Magic Eden, a popular multi-chain NFT marketplace. As of Apr 17, 2024, the most expensive Runestone NFT is listed for an asking price of 787 BTC. Notably, with a market cap of 9,779 BTC ($606,042,181), Runestone is currently the highest-capped Rune-themed Bitcoin NFT collection and the second highest-capped NFT collection overall, right behind the legendary Ethereum-based CryptoPunks.
Rune Pups
Rune Pups is another high-profile Runes-themed Bitcoin NFT collection. Each NFT in the collection is a rune-laced drawing of a broadly smiling creature, which does somewhat resemble a pup. There are 10,778 NFTs in the collection.
Pups are among the most popular Runes NFTs, with a highest asking price of 777 BTC (for item #10,733) and a market cap of 1,301 BTC (~$80 million).
The RSIC Metaprotocol
RSIC Metaprotocol is a collection of 21,000 NFTs, each with a dynamically changing set of ancient rune symbols. Owning an NFT from the collection will automatically open up ways to mine new fungible tokens that the project plans to introduce as soon as Runes is operational. As such, this collection goes beyond simple NFT ownership, turning your non-fungible tokens into yield-generating assets.
Runes vs. BRC-20
Runes isn't the first fungible token standard for Bitcoin. This honor belongs to the BRC-20 standard introduced in March 2023. Unfortunately, BRC-20 is a cumbersome and inefficient way of creating Bitcoin-based fungible cryptos. It relies on inscribing data into tokens using the Ordinals protocol, and generates a lot of "junk" UTXOs on the network.
Due to the novelty of the BRC-20 technology, many Bitcoin users jumped on the idea of using it to issue their tokens, seriously congesting the network and creating a significant "anti-BRC-20" sentiment within the Bitcoin community.
Runes fungible tokens are, however, vastly different from BRC-20 assets. The Runes technology utilizes Bitcoin's native UTXO model, doesn't generate "junk" outputs on the network and places a very modest load on the blockchain. Thanks to all of these advantages, Runes tokens are likely to lead to a much more active and robust trade in fungible assets as compared to BRC-20.
How to Get Runes
Etching and Minting Runes
In Runes terminology, issuing a new fungible token is called âetching,â while adding tokens to the existing supply is known as minting. If you prefer to etch and mint Runes tokens on your own, the process is relatively easy for the technically minded.
First, youâll need to install the Bitcoin Core software and run your own full network node. Then, install client software for the Ordinals and Runes protocols. The latter has been implemented under the Ordinals software packages. Ensure that you thoroughly practice etching, minting and transferring on the test network to familiarize yourself with the protocol.
Buying Runes
You can also pre-buy Runes on Magic Eden. Probably the best wallet to use for these purposes is Xverse's Runes wallet, as itâs specifically designed for user-friendly Runes token management and easy integration with Magic Eden. This marketplace is currently the go-to platform to get early Runes tokens and Runes-themed NFTs.
You can buy any Runes-themed Bitcoin Ordinals NFT on Magic Eden to receive an airdrop of three meme tokens from the Runes protocol directly to your wallet once the protocol's operations kick in. Meme tokens minted under the Runes protocol could potentially experience explosive growth similar to the surge of Solana meme coins earlier this year.
If youâre not able to buy your NFT in time, itâs still not too late to get your hands on one of the most promising assets in the market. You can still wait for Runes to be listed on centralized exchanges and purchase it then.
Closing Thoughts
The arrival of the first Runes tokens is expected to liven up Bitcoin like virtually nothing before. Ordinals were a paradigm-setting innovation, but they were focused on non-fungible assets, which have traditionally lagged behind cryptocurrencies in terms of trading and investment applications. BRC-20 tokens were the first fungible assets on the Bitcoin platform, but their inefficient, network-clogging mode of operation severely limited their adoption and use cases.
Runes are different: For the first time in the history of Bitcoin, thereâs an efficient, native way of creating and managing fungible crypto assets on the Bitcoin blockchain. This heralds a plethora of unique investment opportunities for Bitcoin enthusiasts â at the very moment when the much-anticipated halving has arrived!
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