Runes Protocol, proposed by Casey Rodarmor, the founder of Ordinals, has attracted widespread attention in the Bitcoin community, demonstrating its technical potential and application prospects despite facing challenges from imitative projects such as Rune Alpha.
Authored by: Trustless Labs
1. The Controversy of Authenticity of Runes
1.1 Origin of Runes
The Runes Protocol was proposed by Casey Rodarmor, the founder of the Ordinals Protocol, in his blog.
Casey stated that although he was skeptical about creating alternative token protocols on the Bitcoin network, due to its momentum and the absence of signs of a retreat, as well as the advantages of bringing significant transaction fee income to Bitcoin, attracting developer attention, and user groups, he attempted to create a simpler and more efficient alternative token protocol. The protocol promises to optimize token operations in the Bitcoin ecosystem through a simplified UTXO model and an effective token transfer mechanism.
The Runes Protocol supports token issuance, allowing the creation of any number of tokens, as well as setting human-readable symbols and decimal places. Its transmission mechanism is based on tuples of integer sequences involving token IDs, output indices, and allocation amounts.
1.2 "Fresh" Design of Runes Protocol
Features of Runes Protocol
- Divisibility can be specified during registration (equivalent to decimal), as well as supply, symbol (supporting only one length of Unicode character), and rune name.
- The name characters must be uppercase letters, with a variable length that gradually opens up shorter length runes for registration as the block height increases.
- Names cannot be repeated, with a unique number starting from 0 according to the deployment order, and a unique ID encoded based on the height and deployment order at the current height, for example, 173940/256 represents the 256th rune deployed at height 173940.
- Periods or dots can be added to the name as a display separator, which only affects the display of the name and does not affect registration. For example, registering CASEY•RUNES•EVERYTHING would prevent registering CASEYRUNES•EVERYTHING or CASEYRUNESEVERYTHING, etc.
- Distribution mechanism pending: According to the current code, all supply will be sent to the registrant's wallet address during registration, with subsequent changes expected.
Advantages of Runes over BRC-20 Protocol
- Based on UTXO model: The Runes Protocol adopts a UTXO-based system, which is more consistent with Bitcoin's native architecture. It avoids the need for off-chain data dependency and native token requirements, making the user experience smoother.
- Transfer using OPRETURN: Runes' transfer is implemented through the OPRETURN script, making token allocation and transfer more efficient.
- Issuance mechanism: Runes' issuance is defined through specific message formats, making the flow and distribution of tokens more transparent and clear.
- Higher efficiency: The Runes Protocol addresses the UTXO diffusion and inefficiency issues in the BRC-20 protocol. It simplifies the operation process, requiring only one transaction for registration and transfer, thereby improving overall efficiency.
- Reduced on-chain footprint: Runes aims to minimize its on-chain footprint, reducing the generation of bad UTXOs.
- Lightning Network compatibility: Runes is compatible with the Lightning Network, providing new use cases and possibilities for developers and users.
- Destruction mechanism: Runes contained in transactions with invalid protocol information will be destroyed.
1.3 Runes Imitation — Rune Alpha
Since its theoretical orthodoxy and advancement, the Runes Protocol has been closely watched by the Bitcoin community. However, its slow development progress has also provided opportunities for imitative projects to capitalize on its concept for profit.
Runes Deployer by Ordinals Wallet
As early as the second day of Casey's release of the Runes Protocol concept, Ordinals Wallet began deploying "Runes" in response to its popularity, while promoting it comprehensively on community, social media, and media. Although Ordinals Wallet seized the first wave of traffic for the Runes concept, progress stagnated as the hype faded, leading to nothing.
Rune Alpha
On December 5th, the Bitcoin network's Rune project, Rune Alpha, was officially launched, with its mainnet issuing the first token, $COOK. According to the official Rune Alpha statement, they had technical exchanges with Casey, and Rune Alpha is built on the basis of ord 0.11.1, written into the Ordinals repository.
Part of the Bitcoin community, eagerly anticipating the Runes Protocol, mistakenly believed that this project, with a highly consistent name with Runes, was the Runes Protocol proposed by Casey. Fueled by the escalating market FOMO sentiment, they rushed into Rune Alpha to participate in token minting.
On December 6th, Casey tweeted, stating that he had no affiliation with any Runes-related protocols or services, and that he would not trace and identify these imitative projects when the official Runes Protocol goes live. Meanwhile, some users reported issues such as asset transfers and runes being used as gas burning during interactions. In response, Rune Alpha stated that these were due to user mishandling, and "warnings have been issued to users in the Discord community."
Although Rune Alpha can no longer rely on the narrative of "orthodoxy" to continue marketing, market FOMO and speculative sentiment still prevail. The unique feature of Rune Alpha's inscription minting is "limited time, unlimited quantity": users can mint within 150 blocks between 819863 and 820013, with each minting allowing 1000 tokens, and there is no total limit. According to Dune's dashboard data, as of now (12.22 20:50), $COOK has been fully inscribed in 150 blocks, with 199,153 inscriptions and 10,481 holders.
Following the official launch of the Runes Protocol on the Bitcoin testnet signet by Casey, Rune Alpha quickly responded by deploying tokens on the signet and attempting to demonstrate through screen recording operations and data analysis that Rune Alpha can be recognized and indexed by the official Runes Protocol of the new version ord 0.13.1. At the same time, in response to community calls, Rune Alpha is actively building its Marketplace.
However, according to the current code, the official Runes Protocol mainnet will begin parsing at the block height of the Bitcoin halving, and will only index tokens issued after the halving height and compliant with the Runes Protocol standards.
2. Community Voices
Enthusiastic Embrace
- Ordinals Official Community Ordicord https://discord.com/invite/ordinals
Discussions about Runes in the community began to increase in late September.
Since November, there has been a lot of discussion in the community about the technical implementation of Runes and imitative projects. Users of the Ordinals ecosystem believe that Runes is an upgraded version of the Ordinals Protocol and are generally optimistic, with high expectations for the technical progress of the official team.
After Runes' presentation at the Taipei Blockchain Week on December 16th, a new wave of discussions emerged in the community. Users began to take notice of the imitative project Rune Alpha and expressed doubts about whether the first token, Cook, deployed based on this protocol, could be mapped to the official Runes Protocol.
Users actively went to the Bitcoin testnet signet to experience the Runes Protocol, and community administrators actively assisted users in solving problems.
Referring to community conversations, it is evident that Runes and Ordinals' indexes are currently incompatible on the testnet signet. After Runes is officially deployed on the Bitcoin mainnet, users will need to rebuild a unified index.
Compared to descriptions such as "inscription" and "inscribe" in previous protocols, the Runes Protocol uses new terms such as "rune" and "etch." The subtle changes in descriptive language also reflect the higher precision and lighter weight of the Runes Protocol to some extent.
- OrdinalHub https://discord.com/invite/ordinalhub
Users in the OrdinalHub community also have high expectations and recognition for Runes, wanting to actively contribute, but feeling somewhat helpless due to the slow development progress and lack of information about Runes.
sating.io https://discord.com/invite/kcwE9jH67n
Opposition and Resistance
UniSat Community https://discord.com/invite/unisat
The UniSat official team has expressed a strong interest in Runes and will keep an eye on the protocol's progress, making adequate preparations for technical support.
Subsequently, UniSat added the Runes module, and the BRC-20 protocol added the token $rune.
Some individual BRC-20 ecosystem users in the UniSat community have taken a stance: "BRC-20 > Runes." Certain vested BRC-20 "die-hard fans" staunchly support the BRC-20 protocol, claiming it to be the most orthodox, decentralized, fair, and irreplaceable protocol, and have purchased the BRC-20 protocol token $rune to resist Casey's leadership of the Runes protocol. (UniSat officials responded to this statement with a "thumbs up" gesture). At the same time, they questioned whether Casey has been "slandering" the BRC-20 protocol because he wants to develop a new protocol.
Neutral Observation
- ordinex https://t.me/ordinex
The head of the ordinex community stated at the end of October that ordinex has started paying attention to Runes. In theory, Runes, as a homogeneous token protocol, is superior to BRC-20. However, they also maintain a cautious attitude, stating that ordinary users may not pay much attention to the technical logic behind a protocol, so the widespread adoption in the market is the key to competition between different protocols.
2023.10.22
2023.10.23
The developers of the Leather wallet have added basic support for Runes in their GitHub: https://github.com/leather-wallet/extension/issues/4273
Positive views on Runes being superior to BRC-20:
Based on the incomplete Runes code, its mechanism is not a "fair mint." During registration, all supply will be sent to the registrant's wallet address, and future changes are not yet clear. This is one of the reasons many BRC-20 supporters criticize Runes. Some users in the Trac community believe that the Pipe protocol combines the advantages of the BRC-20 and Runes protocols.
Conclusion
1. Innovation and Application Value of the Runes Protocol:
The Runes protocol demonstrates the possibility of implementing token functionality in the Bitcoin ecosystem. Its simplified UTXO model and efficient token transfer mechanism bring new dynamics and scalability to the Bitcoin network. This marks a significant expansion of Bitcoin's functionality, adding new application layers while maintaining its original features.
2. Comparison between Runes and BRC-20 Protocols:
In terms of efficiency and user experience, the Runes protocol shows significant advantages over the BRC-20 protocol. Based on the UTXO model, Runes avoids the need for off-chain data and native token requirements, providing a smoother user experience. Additionally, the transparency of Runes' issuance mechanism and token transfer process provides users with a clearer and more secure operating environment.
3. Community Response and Acceptance:
The Runes protocol has garnered widespread attention in the Bitcoin community. Despite relatively slow development progress, the community maintains an optimistic attitude towards its technical potential and application prospects. At the same time, the community has shown different reactions to imitative projects such as Rune Alpha, reflecting the complex interests and diverse viewpoints within the cryptocurrency field.
4. Future Prospects and Challenges:
The main challenge facing the Runes protocol is how to further enhance its feasibility and acceptance in practical applications while maintaining its core advantages. In addition, competition with other protocols and the market's adaptability to new technologies are also important factors for its future development.
In summary, the Runes protocol, as an innovative attempt in the Bitcoin network, demonstrates its potential in optimizing token operations. Despite challenges from the community, market, and technology, the emergence of Runes undoubtedly injects new vitality and possibilities into the development of the Bitcoin ecosystem. In the future, with the maturation of technology and further market acceptance, Runes is expected to play a more important role in the cryptocurrency field.
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