Runes Protocol

Definition ∞ The Runes Protocol is a fungible token standard designed for the Bitcoin blockchain, intended to enable the creation and management of tokens directly on Bitcoin’s unspent transaction output (UTXO) model. It offers a more efficient and streamlined method for issuing fungible tokens compared to previous Bitcoin-based token standards. This protocol aims to simplify token management and reduce transaction overhead. It facilitates new use cases for Bitcoin beyond its primary function as a store of value.
Context ∞ The discussion surrounding the Runes Protocol in crypto news centers on its potential to significantly boost activity and utility on the Bitcoin network. Its introduction has already generated considerable transaction volume and fee revenue for Bitcoin miners. A key debate involves whether Runes will sustain long-term developer and user adoption, potentially competing with established token ecosystems on other blockchains. Observing the continued growth and integration of Runes-based tokens will provide insight into Bitcoin’s evolving role in decentralized finance.