What Is Runes Protocol on Bitcoin?

TL;DR
Runes Protocol is a new way of deploying fungible tokens on Bitcoin, set to launch at the Bitcoin halving next month. As it’s created by Casey Rodarmor, also the creator of Ordinals Protocol on Bitcoin, Runes and Ordinals are closely connected. Some top projects crossing over between Ordinals and Runes, and which are lining up to launch Runes tokens, include Runestone, RSIC Metaprotocol, BTC Machine, PUPS, RunesTerminal, and Runes as Fuck.

If you’re interested in Bitcoin Ordinals, you might have been hearing recently about Runes, Runestones, and meme coins coming to Bitcoin, but what’s actually going on in the Bitcoin ecosystem, and are meme coins really going to be appearing soon on the most famous of all blockchains?

What Are Runes?

Over on Ethereum, it’s easy to deploy fungible tokens as ERC-20 tokens, and on Bitcoin, although there are BRC-20 tokens, these have various inefficiencies. In response to this, developer Casey Rodarmor has been working on an improved system for deploying fungible tokens on Bitcoin. These incoming new tokens–meaning the type of token, not a specific coin–are called Runes, and the Runes Protocol launches at the Bitcoin halving, which is expected to occur on 4/20.

And by the way, Casey Rodarmor also created the Ordinals Protocol, which allows for NFT-like assets on Bitcoin, and so Ordinals and Runes are closely connected.

Why Do Runes Matter?

You might wonder whether Bitcoin actually needs fungible tokens, NFTs, or meme coins, and for sure, there’s an argument that these aren’t what Bitcoin was designed for. After all, BTC is a hard asset, it’s digital gold: it’s not built for dog coins, right?

But then, on the other hand… Satoshi Nakamoto long ago stepped away from Bitcoin, and we can’t know what he’d make of recent developments. What’s more, Bitcoin is open for anyone to use, and if there are people who’ve figured out how to deploy memes or anything else, then they have the freedom to take whatever developmental direction they prefer.

What Are the Top Runes Projects?

The Runes Protocol is set to go into effect at the next halving, so right now there are multiple Ordinals projects positioning themselves to launch Runes tokens as early as possible.

Runestone

One of the two leading projects is Runestone, which was created by Ordfluencer and Runemaster (those titles taken from his Twitter bio) Leonidas. It’s a big collection, consisting of 112,383 identical items, which were airdropped to wallets that had participated in the earliest era of the Ordinals Protocol.

Runestones were distributed for free, but have done the most volume of any Ordinals collection on secondary, and holders will receive a share of a planned Runes meme coin airdrop.

On top of that, a growing number of other Ordinals projects are including Runestones holders in their own token drops, including BTC Machine (details on that below), and a DeFi crowdfunding project called Invent on BTC, which creates additional benefits for anyone with a Runestone in their wallet.

RSIC Metaprotocol

The other top Runes project is RSIC Metaprotocol, which contains 21,000 items that were airdropped for free to holders of certain other Ordinals collections back in January, and was created by a mysterious group of devs called Runecoin.

RSICs function as mining units, scooping up yet-to-be released Runes tokens for holders, and meaning that the longer you hold an RSIC, the more of the future token distribution you’ll receive.

Be aware though, that if an RSIC is transferred to a new wallet, the already mined allocation does not travel with it, and instead stays linked to the original holding wallet.

BTC Machine

BTC Machine is an early Ordinals collection that also released a BRC-20 token called ZBIT. Now though, the plan is to convert ZBIT from a BRC-20 project to a Runes token, and, as with RSIC, there is a mining process involved, with BTC Machine holders racking up shares of the future Runes token, as long as their Ordinal is either unlisted, or listed at over 1 BTC.

BTC Machine is also developing a game called Satoria, and has just announced that it will be airdropping some of its ZBIT Runes tokens to Runestone holders.

PUPS

Like ZBIT, the PUPS token was originally deployed as a BRC-20, but is now planning to migrate and become a Runes token.

According to a tweet earlier this month, 77% of the Runes token supply will be dropped to holders of the BRC-20 PUPS token, while 23% will go to holders of the project’s Rune Pups Ordinals, which themselves were airdropped to holders of Bitcoin Puppets Ordinals, although that’s a separate project.

As for the purpose of the PUPS token, it will have, in the project’s own words, “zero utility ever”, and involves “only community run memes.” But then in the world of meme coins, utility is very low down on the list of priorities.

RunesTerminal

This is a rapidly growing project with a sizable following, and it’s focused on building Runes Protocol infrastructure, including a Runes Launchpad, a Runes token deployer, a block explorer, and a Runes Protocol wiki.

RunesTerminal also has a yet-to-be released Ordinals collection, called ApeOdyssey, gearing up for launch, and plans to deploy its own utility-centered Runes token, called RUNI. As the Runes Protocol is a completely new creation, RunesTerminal looks like it will be well positioned from the outset.

Runes as Fuck

A new and very cryptic project, it’s not clear what exactly Runes as Fuck is building, as there’s no website to refer to, but there is a set of rules that have themselves been published as an Ordinals inscription.

It looks like an on-chain card game is in the works, and there are details about a Runes token allocation with a proposed supply of 420 million. There’s also a related Ordinals collection which recently saw a 1 BTC sale, for item #0.

This one is definitely mysterious and flies a little under the radar, so it will be interesting to see where it goes after the Runes Protocol launches.