Two major BRC-20 tokens experienced more than 40% drops in value on a weekly timeframe before the Bitcoin halving event. Concurrently, investors are now paying increased attention to Bitcoin Runes, a novel token standard on the Bitcoin network that streamlines the process of generating fungible tokens for users.
ORDI and SATS down over 40% ahead of the halving
The two most valuable BRC-20 tokens, ORDI and Sats (also known as Ordinals and Sats), experienced sizeable drops in value last week. Specifically, ORDI decreased by approximately 42%, while Sats suffered a loss of around 45% based on information from CoinMarketCap.
The sales of BRC-20 tokens, specifically PUPS and WZRD, have seen a decrease. As reported by the NFT data platform CryptoSlam, PUPS recorded a 30% drop in sales over the last 24 hours, reaching $1.4 million. Similarly, WZRD experienced a more significant decline of 63%, resulting in sales of $1.1 million.
The demand for RUNE BRC-20 tokens has significantly increased, with daily sales exceeding $251,000 – a surge of over 4,500% from previous levels. This indicates that investors are now prioritizing Bitcoin Runes in their trading activities.
During the last seven days, PUPS BRC-20 and WZRD BRC-20 tokens ranked second and third in terms of sales volume on all blockchains. PUPS generated approximately $41 billion in sales, while WZRD recorded around $16.3 million in weekly transactions, based on data from CryptoSlam.
Bitcoins “BitRUNE” protocol, a method for creating interchangeable digital tokens on the Bitcoin (BTC) system, has gained significant attention recently due to its imminent debut. This event, which includes the Bitcoin halving happening later in the week, is anticipated to mark the start of its operation.
Although there is growing excitement about Runes, it’s possible that the true market potential may not emerge until several months after the initial buzz from investors has died down, as suggested by the anonymous DeFi expert Ignas in a recent post on X.
“Runestone, RSIC, and PUPS are already pumping, promising holders shiny new Rune token airdrops. And FOMO threads keep coming. But, like the NFT frenzy post-JPEG reveal, the market could soon cool off.”
Rune price in danger after Bitcoin halving
The cost of running tokens on the BRC-20 network using Rune could decrease noticeably following the halving. This is due in part to the fact that Rune doesn’t significantly enhance the trading experience for BRC-20 tokens right away, and smaller traders may struggle with escalating Bitcoin transaction fees.
With hundreds of Runes anticipated to enter the market, Ignas believes traders’ focus and investment resources may become spread thin, potentially reducing their impact.
In the beginning, Runes had little practical use, as suggested by this anonymous researcher. As a result, their characteristics resemble the volatile trading of meme coins.
“Finally, utility-wise runes will trade as memecoins like BRC-20s. At least at first, so the excitement of ‘new’ will fade away. Especially if no rune token manages to sustain the pump and degens lose money.”
Instead, Ignas expressed optimism about the future development of Runes, believing they could gradually acquire additional capabilities.
ICP intends to incorporate Runes into its system, allowing ICP‘s smart contracts to engage with Runes and Bitcoin‘s BRC-20 tokens at the fundamental level of Bitcoin. This integration expands the functionalities available to token holders.
The initiatives taken by ICP are contributing to a emerging trend referred to as Bitcoin Decentralized Finance (DeFi) or BTCFi. This movement is focused on enhancing the functionality of Bitcoin and assets linked to it.
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2024-04-18 19:57