68% of Runes are in the red — Are they really an upgrade for Bitcoin?

The Bitcoin halving event is usually a one-token show. But this year, it shared the stage with the much-anticipated debut of Runes, a new fungible token protocol that stole the spotlight.

The Runes launch was accompanied by massive hype around the potential of memecoins on the protocol and, to a lesser extent, a fresh functionality for the Bitcoin network to tap into the growing interest in DeFi.

Despite initial enthusiasm, Runes has received its fair share of criticism due to its role in escalating Bitcoin’s transaction fees and failure to generate profits for most investors. 

On halving day, Bitcoin fees soared to record highs, resulting in a generous revenue bump for miners despite their 50% pay cuts on block rewards. The roaring activity didn’t translate into profits for investors, as the top 50 Runes by number of holders are down 30% on average as of April 29, OKX data shows. Two-thirds of them (34 out of 50) are in the red.

Advocates maintain that it’s premature to discount Runes, as developers envision a future where the protocol evolves to provide more substantial utility, facilitating improved trading experiences and broader adoption within the Bitcoin ecosystem.

Investor shares Runes trading experience. (0xNefu)

“I’ve been there when other protocols launched [and] they all sucked in the first few days,” Quary, the pseudonymous founder of Bitcoin marketplace Magisat, tells Magazine.

“I see no reason not to be bullish [on Runes] in the medium or long term.”

New use cases for Bitcoin unlocked

The hype surrounding Runes was “undoubtedly” immense, according to Benjamin Charbit, CEO of metaverse firm Darewise Entertainment, a genesis member of the decentralized Bitcoin protocol Opal.

A big part of the excitement surrounding Runes comes from the potential ability of memecoins to onboard new retail users into the Bitcoin ecosystem.

Runes can expand the functionality of the Bitcoin blockchain by enabling users to tokenize various real-world…

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