Within days of its launch, the protocol was surpassing regular bitcoin transactions in popularity

Share of transactions with the Runes protocol in the Bitcoin network fell by 84% in a month

23.05.2024 - 11:40

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2 min

What’s new? The Runes bitcoin protocol, which allows the creation of fungible tokens in the blockchain of the first cryptocurrency, is rapidly losing popularity. Right after launch, it accounted for the vast majority of all bitcoin transactions, but a month later, the figure dropped by 84%, according to data from analytics platform Dune.

Dune’s data

What else is known? Runes launched alongside halving on April 20 and initially caused a surge in online activity, with Runes accounting for at least 50% of all bitcoin transactions over the next four days.

The peak was reached on April 23: Runes transactions accounted for 81,3% of the total number of transactions in the Bitcoin blockchain. By May 2, this figure had already dropped to 11,1%, and after a brief surge on May 4-6, it went down again.

On May 23, the share of Runes in the total volume of transactions is 12,7%. Thus, a month later, the indicator has decreased by more than 84%. At the same time, the share of Runes is still higher than the indicators associated with the Ordinals protocol for creating bitcoin NFTs and the BRC20 standard for creating fungible tokens: their shares are 0,7% and 1,5%, respectively. You can learn more about Ordinals and BRC20 here.

Runes has already faced criticism in the crypto community. Some of its participants believe that the project’s usefulness is dubious and unobvious, and it benefits only miners, whose income from fees has increased as a result of the network’s growing activity.

The creator of Runes and Ordinals himself, Casey Rodarmor, believes that transaction fees play a crucial role in securing the network in the long term, given that the reward directly for mining blocks is halved with each halving every four years.

Earlier, JPMorgan Bank also noted the decline in the popularity of Runes, followed by the departure of inefficient miners from the industry and the resulting decline in the network’s hashrate.

Last week, the number of new bitcoin addresses fell to a 2018 low.

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