The 2024 halving is a monumental event in the world of cryptocurrency. However, this year, something even more significant is set to take place on the same day. The Runes protocol, along with the quest for the legendary satoshi, the first satoshi of the halving block, will commence. This could potentially be a game-changing event in the history of Bitcoin (BTC).
The Runes protocol is the second phase of Bitcoin’s Ordinals protocol, which was launched in December 2022. The Ordinals protocol brought about a cultural movement like never before seen on the largest blockchain in the world. It allowed users to embed images, audio, and code files onto the Bitcoin blockchain. Building upon the success of the Ordinals launch, developer Casey Rodarmor introduced the concept of the Runes token protocol. This protocol aims to facilitate the creation of fungible tokens on the Bitcoin network.
The activation of the Runes token protocol will coincide with the halving. This will initiate a battle among players to see who can issue the first tokens and come up with the best token names. Following that, there will be a race to be the first to purchase these tokens. Exchanges worldwide are already making preparations to list the main tokens that will be launched with the Runes protocol. Marketplaces and decentralized exchanges like Magic Eden and OKX have announced their support for tokens created from the Runes protocol right from day one.
The introduction of the Ordinals and Runes protocols has brought a historical significance to Bitcoin. Unlike other blockchains like Ethereum (ETH) and Solana (SOL), which are known for their application development platforms and environments for issuing and exchanging various assets, Bitcoin has traditionally been seen as an asset with no specific purpose. However, since the launch of the Ordinals protocol, thousands of people have been using the Bitcoin network daily to acquire assets priced in Bitcoin. Over $3 billion has already been transacted through these Ordinals assets in just over a year, involving nearly 600,000 unique wallets and 2.5 million on-chain transactions.
The Ordinals protocol has had a cultural impact on Bitcoin, leading to a period referred to as “the second phase of Bitcoin.” This period is characterized by a surge of innovation around the world’s largest blockchain. With renewed interest in navigating and building on Bitcoin, products like wallets, nodes, unspent transaction output (UTXO) managers, and even the mempool have improved. Discussions surrounding decentralized finance (DeFi) and Bitcoin’s layer-2 solutions are more intense than ever, attracting attention from venture capitalists.
The Ordinals protocol lit a new flame in Bitcoin, and the Runes protocol represents the next phase. The halving block itself will be highly contested and potentially lucrative. In addition to the competition for block spaces, miners will also engage in a duel. The miner who mines the halving block will receive an “Epic” satoshi, estimated to be worth over $1 million.
To handle the anticipated congestion on the Bitcoin network, some projects are developing solutions to scale trading on the Runes protocol. In the past, a bridge enabling the exchange of Bitcoin assets on Solana was successful. Now, platforms more aligned with Bitcoin, such as RuneChain, a Bitcoin layer-2 focused on Runes, are emerging.
As the market prepares for the launch of the first tokens created with the Runes protocol, users are becoming more knowledgeable about Bitcoin. Thousands of people have started running Bitcoin nodes and educating themselves about UTXOs to gain an advantage during token launches. NFT communities like the Pizza Ninjas have made significant efforts to educate their holders on these topics. They have created a comprehensive survival guide for Runes and offer 24/7 help desks in English and Chinese.
The market has also experienced a “pre-Runes season.” Some Runes-standard tokens have already been “pre-distributed” through airdrops to Bitcoin NFT holders. Each collection has its own distribution model, with some taking snapshots of NFT holders and distributing tokens after the halving, while others base token distribution on the duration of NFT ownership.
Investors and enthusiasts can also capitalize on the trend by purchasing BRC-20 tokens that will migrate from the BRC-20 standard to the Runes standard, such as WZRD and PUPS.
Bitcoin’s second season is approaching a climactic moment with the Runes tokens set to make history. These tokens will be loved, hated, transformative, frightening, necessary, exhausting, and everything in between. But they will happen, and nothing will stop them. Welcome to season two!