The inventor of Bitcoin Ordinal proposes a new Bitcoin-based fungible token protocol as a potential alternative to the BRC-20 token standard.
The BRC-20 standard was launched in March by anonymous developer “Domo”. Within two months, the market capitalization of BRC-20 reached $1 billion, with PEPE and ORDI being among the most famous BRC-20 tokens created on Bitcoin.
A new scary idea just dropped: runes.
Bitcoin’s “worse is better” fungible token protocol.https://t.co/TPVrUvWxm8
— Casey (@rodarmor) September 25, 2023
BRC-20 allows the minting and transfer of fungible tokens through the Ordinals protocol on Bitcoin. But the problem with BRC-20 tokens, Rodarmor believes, is that they spam Bitcoin with “garbage” unspent transaction outputs, or UTXOs.
BRC-20 Token Has “Adverse Consequences of UTXO Proliferation,” He explained In an article on September 25, Runes was proposed as a UTXO-based alternative.
“UTXO-based protocols fit more naturally into Bitcoin and promote UTXO set minimization by avoiding the creation of “junk” UTXOs.”
TLDR on Runes – Bitcoin’s Potential Fungible Token Protocol
ᚱᚢᚾᛖᛊ
– Casey remains skeptical, saying “99.9% are hoaxes and memes,” but admits they don’t seem to be going away.
– Adopts a UTXO-based system, which is obviously simpler than BRC-20.
– Use the letter “R” in… https://t.co/zYP43f70gh— Franken (@ItsFranken) September 25, 2023
Rodarmor added: “If a protocol has a smaller on-chain footprint and encourages responsible UTXO management, it may reduce harm compared to existing protocols.”
UTXO represents the amount of cryptocurrency remaining in the wallet after completing a transaction, with the balance used for subsequent transactions and stored in the UTXO database.
Bitcoin’s UTXO model Plays a role in making Bitcoin an auditable and transparent ledger by preventing double-spending issues.
Rodarmor said that other alternative token protocols on Bitcoin, such as “Really Good for Bitcoin”, “Counterparty” and “Omni Layer” also have their own problems.
While Rodarmor admits that 99.9% of fungible tokens are full of scams and memes, he believes that the right fungible token protocol can add value to the Bitcoin network:
“Creating a good fungible token protocol for Bitcoin could bring significant transaction fee revenue, developer attention, and users to Bitcoin.”
related: Despite price plunge, serial numbers still account for majority of Bitcoin transactions
September 25 Twitter Spaces and The Ordinals Show co-host Trevor Owens, Rodarmor explain He floated the rune idea last week, but he’s not sure whether he will pursue it further.
Shortly after the call, Owens offered to provide $100,000 from the Bitcoin Frontier Fund to potential developers who could create and run Rune applications as a means to further advance Rodarmor’s proposal.
Investment offer of USD 100,000 to be opened soon @BTCFrontierFund Accelerator for the first team who can get a working (not terrible) rune indexer, distribution and/or transfer application up and running
Don’t make tickers have to be unique, it will be a shit show
Private message me. Serious offer. pic.twitter.com/6W0IwlhB9x
— Trevor.btc (@TO) September 26, 2023
Cointelegraph reached out to Rodarmor for comment but did not receive an immediate response.
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