Nfts
the Runes protocol and the drop in activity on Bitcoin
Latest crypto news: Runes, the well-known protocol for generating fungible tokens on Bitcoin based on UTXO and OP_RETURN, has just reached the milestone of 2,500 BTC in fees since its launch in April, coinciding with the halving of the cryptocurrency.
These figures recorded in terms of fees, allow miners to obtain a boost on profits and reduce the impact of the reduction in the overall reward.
In the meantime, however, the latest news speaks to the general activity of NFTs, BRC-20 and Runes on Bitcoin seeing a sharp decline, enough to trigger an on-chain divergence between the number of active addresses and the number of addresses active. transactions.
Let’s see everything in detail below.
Runes Protocol Generates 2,500 BTC in Fees Since Launch in April, But Activity Is Declining
The latest news from the NFT and Bitcoin market talks about Runes, a famous protocol for generating fungible tokens based on unspent transaction outputs (UTXO), which reached an important milestone yesterday.
Since its launch on April 20, 2024, coinciding with the Bitcoin halving, Runes have collected over 2,500 BTC in fees.equivalent to more than $163 million, marking a period of growth for the decentralized finance sector on the main crypto chain.
This step is particularly important because it occurs at a time delicate historical moment for Bitcoin minerswhich, after the block reward halving and unexciting BTC price action, faces a period of limited revenue.
We remember in fact that after the last half the block reward increased from 6.25 BTC to 3.125 BTC.
The advent of Runes, as well as that of NFTs with inscriptions and BRC-20 tokens, allowed network miners to have additional income derived from the high costs checked in
In this regard, Nazar Khan, co-founder and COO of mining company TeraWulf, said in a recent interview that:
“Runes significantly increased transaction fees, so there was an increase in hash price in the first 24-30 hours. [after the halving]. Since then, we have seen transaction fees decrease, but compared to average fees for 2023, they remain quite high.
We highlight how in just 2 months since its launch, the Runes protocol has managed to establish itself as the dominant standard for the creation and issuance of fungible cryptographic tokens.above other similar standards, far surpassing NFTs and BRC-20.
Considering the distribution of transactions on the Bitcoin blockchain, we can observe how from April 20, transactions related to Runes exploded, establishing themselves in the first days of existence with a share between 47% and 81%, to then maintain an overall high level. activity in the following weeks.
Regardless, the dune map clearly shows how in recent days, activity has fallen drastically, from 60% in June to the current level of 13.5%.
In this context, Ordinals transactions with registrations for NFT represent only 0.5% of the total network emissions, while BTC-20 represents 3%. Regular BTC transactions accounted for 83.1% as of June 17, 2024.
Source: https://dune.com/cryptokoryo/runes
NFT, BRC-20 e Runes: the latest news on the decline of active addresses on Bitcoin
Amid the recent imposition of the Runes protocol and subsequent decline in on-chain activity, the latest news from the crypto company Glass knot highlight how a a strong counterintuitive divergence forms between the decline in active addresses and the increase in the number of transactions on the Bitcoin network.
The “Bitcoin: Active Address Momentum” metric is representative of the sharp reduction in active addresses on Bitcoin in recent weeks, where the level of 653,000 daily addresses was reached recently: such a low value had not been observed since 2019.
Right now, the Bitcoin blockchain is experiencing a situation similar to where China imposed restrictions on Bitcoin mining in mid-2021, leading to a sharp drop in network activity, albeit driven by completely different current factors.
In fact, at the center of the problem today we do not find strict regulations, but rather everything that revolves around the sector of NFT, BRC-20 and Runes Inscriptions.
Despite the active address metric in free fall, the number of daily transactions is instead recording new all-time highs, forming a divergence with the downward trend analyzed previously.
The amount of transactions processed by the network amounts to approximately 617,000 tx/day, which is 31% higher than the annual average and indicates a relatively high demand for storage space. Bitcoin Blocks.
Comparing the recent drop in active addresses with the share of transactions attributed to registrations and BRC-20 tokens, we see a strong correlation.
In all this, however, the transactions resulting from NFT registrations collapse from mid-April, since they were replaced by the advent of Runes (which in turn are also in strong crisis in recent days).
This suggests that The initial factor in the decline in address activity is largely due to the reduction in recording and use of ordinals, and then a decline in enthusiasm for runes.
It is important to remember that many wallets and protocols in this industry reuse addresses, which are not counted twice if the address is active more than once in a daily period. Therefore, if a single address generates ten transactions per day, it will appear as one active address, but as ten transactions.
