Can the Runes protocol become the mainstream issue coin standard in the crypto market?

The ERC20 protocol of Ethereum, as the most important token standard in the encryption field, has had a tremendous impact on the entire industry. It not only promoted the development of the Ethereum public chain, making it the most mainstream smart contract platform, but also facilitated the rise of decentralized finance (DeFi) and provided project parties with a more direct and efficient financing channel.

In the face of Ethereum's success, many emerging public chains are trying to replicate its path and cultivate their own coin ecosystems. To achieve this goal, the key lies in two points: first, the public chain itself needs to have a sufficiently large market capitalization foundation; second, the issue coin protocol needs to be innovative to gain recognition from users and the community.

In this context, the Runes protocol demonstrates the potential to surpass ERC20. Its advantages are primarily reflected in the following aspects:

1. Bitcoin, as the underlying foundation, holds nearly 50% of the entire crypto market value, providing a solid basis for Runes.

2. The innovation and fair issuance mechanism of BRC20 inscriptions have gained widespread recognition, and Runes has further optimized it on this basis.

3. The Runes protocol combines the advantages of BRC20 and ERC20, while serving as an asset issuance protocol on the Bitcoin mainnet, offering unique benefits.

Core Features of the Runes Protocol

Runes uses the OP_RETURN field in UTXO to record operation information such as token deployment, minting, and transfers. It supports multiple issuance models, allowing for fair launches similar to BRC20, as well as setting aside team reserved shares, providing project parties with more flexible options.

Compared to BRC20, Runes perform better in the following aspects:

• Higher flexibility: supports team reserves and fundraising, not limited to completely fair launches.
• More convenient operation: No additional engraving transactions are required, reducing user costs and network burden.
• Support concurrent transactions: A single transaction can send tokens to multiple addresses at the same time, improving efficiency.

Compared to ERC20, Runes also have their unique advantages:

• A more solid value foundation: relying on the Bitcoin network, it has stronger security and stability.
• Innovation potential: As an emerging protocol, there is greater room for development and market attention.
• Compatible fair launch: aligns with the important narratives of the current crypto market.
• Scalability: By integrating with Bitcoin Layer 2 solutions (such as BEVM), complex business applications can be realized.

Technical Details of Runes Protocol

The Runes protocol enables the deployment, minting, and transfer of tokens by constructing specific OP_RETURN transactions. Various parameters can be set during deployment, such as total token supply and minting rules. The protocol supports three launching methods, including total control by the project party, fully fair minting, and a hybrid model.

During the minting process, users only need to include specific OP_RETURN information in the transaction to complete the operation. Transfers are achieved by specifying the UTXO that contains Runes and the target address.

Overall, the Runes protocol offers a more flexible and efficient token issuance and management mechanism while retaining the advantages of the Bitcoin network. With the development of the ecosystem and the cooperation of Layer2 solutions, Runes has the potential to become the next generation mainstream issue coin protocol, bringing new vitality and opportunities to the crypto market.