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Just recently, Bitcoin underwent its most recent halving event. As usual, this meant a 50% reduction in block subsidy rewards for all miners.  Halving events are generally seen as bullish for bitcoin’s market price; however, the immediate effect is a drop in revenue for those mining bitcoin.  That’s not all that’s different with Bitcoin, though. New protocols are changing the way users engage with the network, pushing up fees and, in many ways, offsetting the losses that come with a halving. Unfortunately, this is also causing issues with blockspace and network congestion.  Many Bitcoiners argue against bringing Ordinals, Runes and other meta-protocols to Bitcoin because they think that these are counter-productive (antithetical even) to bitcoin being the world’s reserve currency. But I believe that the innovation happening on Bitcoin right now is what will ultimately lead to a better Bitcoin for everyone. It’s not just about fees Over the last year or so, we have seen the proliferation of Bitcoin Ordinals and the BRC-20 standard. What makes these assets interesting is that they have effectively brought NFTs to Bitcoin, opening up new functionality and letting the network do things that simply weren’t possible before.  These new digital goods have already proven to have a meaningful impact on miner revenue. And in the wake of the halving, that could be exceedingly important — the popularity of BRC-20s is driving up network fees, helping to offset the reduction in block rewards. We have also seen the launch of a brand new type of asset on the Bitcoin blockchain, known as Runes. Runes are similar to BRC-20s, but they have one notable difference: They are a much more efficient way for users to issue fungible tokens on the network.  Now, Runes are yet another type of asset that demands blockspace on Bitcoin, driving…

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Filed under: News - @ May 29, 2024 4:28 pm