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Did Bitcoin Runes Not Live Up to Expectations? It’s still too early to tell
Runesthe new fungible token standard on Bitcoin, sparked excitement among enthusiasts when it was launched in April in the middle of the four-year period Bitcoin halving event. But less than a month later, the initial impact appears less monumental than many Bitcoin supporters expected.
The launch of Runes saw an immediate flurry of activity, with hundreds of ticker tokens launched within the halving block. But demand has fallen partly due to expectations and amid a cooling cryptocurrency market that has seen a broader price decline in recent weeks.
Data from Satellite screener indicates that six of the ten most traded runes have seen a decline in trading volume over the past seven days, ranging between 20% and 57%. In terms of the number of runes engraved, data from Dune shows that incision has declined significantly since early May, from thousands per day in late April to just hundreds per day of late.
On social media the discussion on Runes is divided. Many expected that the trading experience would be closer to trading established tokens like EthereumERC-20 and not blocks of tokens pre-split by users. This made them feel more like they were trading NFTs rather than fungible tokens, with the early state of the technology creating another hurdle for early traders.
But a small but vocal group of users continues to actively trade Runes amid the decline, even some of them admit that there is a cooling of enthusiasm after the Bitcoin halving event.
So, what’s next for Runes? Market observers were quick to draw parallels between Runes and NFT-likes Sort them—both created by Bitcoin developer Casey Rodarmor—highlighting a similar pattern of initial hype followed by a gradual decline in activity.
Others believe that runes may follow a similar maturation arc. Similarly, the previous Bitcoin token standard BRC-20 saw an initial wave of enthusiasm before a quieter period with less hype and demand, followed by a surge in value and trading activity. However, Runes have been touted as a more “efficient” upgrade to BRC-20, so early trade issues may also dampen short-term momentum.
“Users new to Bitcoin may have been disappointed that the experience is not dissimilar to BRC-20, and far from the advancements many have touted in their timelines in recent months.” FarmerJoe0xthe founding pseudonym of Puppy Tokensaid Decipher.
“That said, several opportunities appear to be forming, such as rune bridges at level 2 of Bitcoin [networks], as well as Solana,” they added. “Demand for Bitcoin tokens is proving strong on centralized exchanges and it can be assumed that when the tokens are accessible in the trading experience desired by most cryptocurrency users, we will see significant volumes, possibly on other chains, towards these tokens. “
Yoonsup ChoiSenior Business Development Manager at Magic Eden, shared with Decipher that although he had observed the decline, it had been predicted. Magic Eden came out early as one of the most important trade destinations of the runes, so he has a stake in their future. Choi remains confident that the Bitcoin fungible market has significant upside potential.
“The rune trading UI will only get better, updates can be made to the protocol, and marketplaces like Magic Eden are investing in improving the UI/UX every day,” he said. “While the UI/UX may never reach SOL or EVM layer-2 meme coin trading, the transparency and immutable appearance of Runes may be another way that Runes find [their] place.”
Choi added that meme coin launches are often plagued by internal team issues, such as sniping, distribution across multiple wallets, and lack of clarity regarding the use of funds. The Runes Protocol addresses many of these concerns.
“Runes offer complete transparency in their creation, including details on pre-mining rates and minting criteria,” Choi explained.
Despite this cooling period, the Runes remain in their infancy, and advocates argue that it is too early to rule them out. The technology is still evolving, and as the community becomes more familiar with Runes’ features and the ecosystem matures, there is potential for renewed interest and growth.
Furthermore, rune transactions are continues to dominate Bitcoin in recent times, although some of the hype has waned. Previous Bitcoin innovations such as Ordinals and BRC-20 tokens took some time to find broader commercial interest and considerable demand, but both ultimately secured substantial market fit. The cryptocurrency world is watching closely to see if (or when) this happens with Runes.