Bitcoin’s Runes Protocol Sees Activity Dropping Significantly

Activity on Runes Protocol has dropped significantly since the first week of trading. On May 10, there was a noticeable drop in activity, with very few new coins and new wallets interacting with the protocol.

According to a dashboard from Dune Analytics, the return on the protocol’s costs has steadily declined. While Runes still makes hundreds of thousands of dollars in fees on the Bitcoin blockchain every day, its total fees have crossed the $1 million mark only twice in the last 12 days, indicating a downward trend.

Runes is a new Bitcoin token standard that allows users to create fungible tokens on the blockchain, launched by Ordinals creator Casey Rodarmor. Ordinals made non-fungible tokens possible on Bitcoin.

The Runes Protocol debuted on April 20, coinciding with the last Bitcoin halving event. The launch of Runes created a frenzy among investors, leading to a rise in transaction fees and a record-breaking windfall for Bitcoin BTC tickers down $62,848 miners, with more than $135 million generated in fees in the first week alone.

Data from Dune Analytics shows that until April 24, Runes-related transactions made up the majority of transactions on the Bitcoin network. On April 23, Runes claimed its highest transaction share of 81.3%, causing Bitcoin transaction share to drop to 18.15%, with Ordinals and BRC-20 transactions at 0.1% each.

Runes transactions declined steadily over the next nine days until May 2. From May 3, Runes started to recover and regained its transaction share above 60% on May 4 and 5.

The mining community welcomed the rising costs as their revenues dropped significantly after the Bitcoin halving. In May, total revenue for Bitcoin miners fell below $30 million per day.

Runes, like Ordinals, launched a new token standard on the Bitcoin blockchain. Bitcoin recently processed its billionth transaction. Runes has already achieved significant success, with several Rune collections having a market cap in the hundreds of millions of dollars, according to Magic Eden data.

Moreover hints Rodarmor recently featured an innovative audio-reactive generative art project at an Ordinals event in Hong Kong, further showcasing the platform’s potential.