Three weeks after its blockbuster launch, Runes faces declining activity

Bitcoin's novel Runes protocohas been active on the blockchain for three weeks following its launch on April 19, coinciding with Bitcoin's latest halving event. Runes' blockbuster launch helped generate record fees for Bitcoin miners as excited investors fought for block space, and over the first week, Runes generated over $135 million in Bitcoin transaction fees.

However, activity since the first week of trading has generally slowed, according to a Dune analytics dashboard compiled by Runes Is. May 10th saw some of the lowest levels activity yet on the Runes protocol, with the fewest number of new mints and fewest new wallets interacting with the protocol since its launch. 

Data from The Block also shows a steady decrease in fees generated by the protocol; while Runes still generate hundreds of thousands of dollars per day in fees on the Bitcoin blockchain, the sum of fees has broached $1 million only twice in the past twelve days. 

Of course, many platforms struggle with early adoption, and Runes is far from obscurity; several Rune collections have market capitalizations in the hundreds of millions of dollars, according to Magic Eden data. Runes developer Casey Rodarmor, who also created Bitcoin Ordinals, also recently teased an audioreactive generative art project at an Ordinals event in Hong Kong. 

With Runes, like with Ordinals, different token standards are possible on top of the Bitcoin blockchain for the first time. Runes leverages Bitcoin’s UTXO model and the OP_RETURN opcode to offer a more efficient Bitcoin tokenization solution than the BRC20 standard, leading to mostly memecoin trading activity on Bitcoin, which recently processed its one billionth transaction.