was Bitcoin halving is just hours away. And related releases Rune Fungible Token StandardAnd collectors at the top of the chain might wonder: What does this have to do with anything? NFT-good night ordinal number Is there an inscription on the chain? and what BRC-20 fungible token Is it built on the Ordinals protocol?
unequal Ethereum’s “merge” transition Not until late 2022 Reasons for concern About what can happen on-chain Bitcoin later assets bisector. Halving simply means that mining rewards are reduced every four years, which tends to slow the supply of new BTC entering the market and ultimately lead to price spikes.
Since Bitcoin continues to generate blocks, the Ordinals inscription or BRC-20 tokens will remain in your wallet and you will not need to do anything else. However, the bigger question concerns demand for Bitcoin-related assets and how the launch of the new Runes token protocol will impact interest in BRC-20 tokens.
Ordinals have seen a surge in demand in recent months, with NFT trading volumes surpassing those of long-time leaders. Ethereum. This change led to the creation of Magic Eden, a cross-chain marketplace. to the top of the pileThe Ordinals collection, which promises to provide holders with upcoming rune tokens—Like a rune stoneFor example — it’s soaring as a result.
Will momentum changes lose steam after the halving? Although no one can say for sure DappRadarRobert Hoogendoorn, senior communications manager at , expects Ordinals and other Bitcoin-based assets to benefit from the expected BTC price increase.
“It’s just as likely that the halving will push prices higher, increasing demand for BTC in the long term,” he said. decryption“We also expect demand for Bitcoin assets like Ordinals to increase,” he said.
For BRC-20 tokens, we have seen a decline in demand for some popular Bitcoin tokens in the market, such as ORDI and SATS. It fell much more than Bitcoin It has been harder than many other cryptocurrencies over the past few weeks.
The Runes protocol is not only considered a more efficient implementation of Bitcoin-based tokens, but it also has another potential advantage: This protocol was developed by Casey Rodarmor, the inventor of the Ordinals protocol.
BRC-20 was an experimental token standard based on his protocol, allowing anyone to freely build permissionless chains. But the Runes have Rodarmor’s unique stamp. With billions of dollars worth of Bitcoin being thrown into this space in hopes of acquiring the precious asset, this makes sense for some collectors and investors.
“It’s his vision of how this comes together,” said Elizabeth Olson, head of growth at Bitcoin wallet startup Xverse. previously said decryption. “Obviously Ordinals have been a huge success, so I don’t think Runes will ever be as big or as big as the BRC-20 token.”
But runes, for better or worse, depending on your perspective, could shake up Bitcoin’s economics and create new assets on the chain. There is a lot of excitement surrounding the launch of Rune, including projects vying to be one of the first mints. rune demand Network usage costs may be higher for some time to come.
“The launch of the Runes protocol during the halving will likely lead to a period of high fees for Bitcoin,” said an anonymous NFT historian and author. Runestone Project Co-Creator Leonidas said decryption. “This will impact the Ordinals protocol in many ways. “It costs more to record files on chain, so artists have to become smarter about how they use their file space.”
What if the number of new Ordinals projects being deployed on Bitcoin decreases and purchases and transactions become more expensive anyway? Some builders believe this will increase the prices of existing collections.
“The increased costs associated with deleting collections will lead to scarcity of existing collections,” Leonidas added. “Existing collections won’t have to compete as much for share of recognition with new mints because there won’t be many of them.”
He also noted that the Runes protocol leverages Ordinal to “attach a visual component to every rune etched,” adding another use case for Ordinal to the process.
Xverse founder and CEO Ken Liao echoed the sentiment about fees affecting the Ordinals space because “it’s harder and more expensive to create new space.” And he also agrees that the increased demand for Bitcoin assets due to scarcity after the halving cuts miner rewards in half will have a clear impact on Ordinals.
Of course, there is a downside to this, which could potentially lead to higher fees and asset prices. As everything becomes more expensive, the Bitcoin asset can feel even more exclusive.
This isn’t necessarily a bad thing, especially for holders of those assets, but it can limit the number of people who can afford to play in that space. However, many other chains are much cheaper to use, and Bitcoin Layer 2 scaling networks are also emerging. Nonetheless, this could trigger a shift in sentiment that would push Bitcoin into a much rarer category.
“We are confident that speculators will enjoy the new Runes playground for some time, at the expense of the BRC-20 movement,” said Randy Wasinger, CryptoSlam founder and CEO. decryption.
“Ordinals caters to niche high-end assets that can leverage the prominence of Bitcoin. But otherwise, we won’t see Bitcoin-based applications achieve sustained mass adoption,” he added. “Tokens need to move to thrive, and ultimately Bitcoin’s high transaction fees will dampen transaction volume and momentum regardless of protocol.”
Edited by Ryan Ozawa.