The cost of transaction fees for Bitcoin (BTC) has been steadily rising and Bill Barhydt, the CEO of Abra Global, thinks this may be linked to Runes, a newly suggested token format on the blockchain.
Bitcoin Gas Fee, Runes, and Ordinals Link
Today, the long-awaited Bitcoin halving occurred, but currently drawing significant interest is a new development by Casey Rodamor called Runes. According to Barhydt, this token standard is leading to a substantial increase in Bitcoin transaction fees.
Using Runes simplifies the process and saves resources for users looking to develop interchangeable tokens on the Bitcoin network. Essentially, the main function of this token standard is to pave the way for the creation of such tokens on Bitcoin, according to Barhydt’s announcement. He also mentioned that currently, the most widely used fungible tokens are ERC-20 tokens in Ethereum.
Runes!
“What are Runes, with their intrigue piquing many, and how do they explain the surge in high Bitcoin transaction fees?”
Read on….
Creating fungible tokens on the Bitcoin blockchain becomes simpler and more effective with the introduction of Runes, a novel suggested token format.
— Bill Barhydt (@billbarX) April 20, 2024
Rodamor, like Ordinals, can be linked to the unveiling of Ordinals. However, Runes functions distinctly from Ordinals, enabling users to generate Non-Fungible Tokens (NFTs) on Bitcoin. With Ordinal’s functionality, individuals can add data to the tiniest Bitcoin units (satoshis), resulting in valuable assets on the Bitcoin network.
The two protocols have some commonalities, as they enable users to issue and create digital tokens directly on the blockchain.
Capabilities of Rune Highlighted By Abra CEO
Runes makes use of minor, unweighted transactions called “edicts” for transferring token ownership. This function generally avoids putting undue strain on the Bitcoin network. To facilitate the creation and administration of fungible tokens more conveniently, Runes employs Bitcoin’s UTXO system and the OP_RETURN command.
“CEO of Abra Global explained that each Rune transaction can contain several tasks for various Runes. During a token transfer, the Runes protocol divides the UTXO into numerous new UTXOs according to the directives in the OP_RETURN information.”
Barhydt explained some advantages of integrating Runes into Bitcoin’s infrastructure. Among these benefits are reducing the on-chain impact and enhancing UTXO management. He is convinced that this token standard will lead to a more streamlined process for creating fungible tokens on the Bitcoin platform, making it more straightforward than alternatives such as BRC-20, RGB, and Taproot.
Users of Runes have the ability to generate and control multiple tokens directly on the blockchain without relying on external data or specific tokens.
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2024-04-20 20:43