According to The Block, in addition to the discussion on Bitcoin halving itself, the Bitcoin community is also eagerly anticipating the launch of the Runes Protocol (expected to go live at the same time as Bitcoin halving). Data shows that recent speculation on BRC-20 has also driven up transaction fees on the Bitcoin chain.
The Runes Protocol is a new token protocol proposed by software engineer Casey Rodarmor. Prior to this, Rodarmor created the Bitcoin Ordinals Protocol in January 2023. The main concept behind Ordinals is to bring non-fungibility to Bitcoin by distinguishing specific satoshis based on the minting order.
The BRC-20 token standard emerged shortly after the release of Ordinals, facilitating the issuance of new homogeneous tokens on the Bitcoin network.
Runes is somewhat similar to BRC-20, aiming to enable new tokens to be traded on the Bitcoin chain. However, unlike BRC-20, Runes will adopt the Unspent Transaction Output (UTXO) model. Essentially, Runes aims to be a more efficient token issuance mechanism, designed with network congestion in mind. Given the success of BRC-20, many believe that Runes has the potential to be the next major breakthrough.
According to CryptoSlam data, PUPS, a meme coin based on BRC20, has had daily trading volumes reaching millions of dollars this month, making it the second largest NFT/BRC-20 collection in the past seven days. Each PUPS token based on the BRC-20 standard will have ownership of PUPS runes, which can be exchanged for PUPS runes once Runes is launched.
The speculation surrounding these runes has naturally driven up Bitcoin transaction fees, with the 7-day moving average of network transaction fees increasing from $4.11 at the beginning of the month to $12.17 now. Although this value is still relatively low compared to the peak during the Ordinals speculation in December last year, this surge is enough to surpass Ethereum transaction fees.
Source: The Block