Runes could solve Bitcoin's long-term security: IntoTheBlock

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The Bitcoin (BTC) halving is less than 10 hours, and the introduction of Runes is set to make this halving different from the past ones, according to the “On-chain Insights” newsletter by IntoTheBlock. Spearheaded by Casey Rodarmor, known for his influential work on Bitcoin Ordinals, Runes is a new protocol for creating fungible tokens using Bitcoin’s infrastructure, and could potentially solve the blockchain’s long-term security.

“Runes and Ordinals, although controversial, are likely to contribute to Bitcoin’s security budget and make the network more sustainable as inflationary rewards decline,” states the report from IntoTheBlock.

As the halving approaches, the Bitcoin community is closely monitoring the potential impact on miner revenues. Transaction fees, which surged to over 20% of total miner revenues in December 2023, are anticipated to play an increasingly vital role in compensating for the 50% reduction in block rewards. The integration of Runes could further amplify fee generation, providing a much-needed boost to the network’s economic model.

The halving event also arrives at a time when miners’ BTC holdings are at a 12-year low, underscoring the urgency for alternative revenue streams. Runes may offer a short-term lifeline for miners, redirecting speculative activities to the Bitcoin blockchain and potentially stabilizing the network’s financial foundation, the report suggests.

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