Ordinals: Rare and exotic sats

[d5000]

you do get my perspective that the Runes protocol + the Lightning combination to build a fast, scalable stablecoin might work, no?

I actually would love to see that. However, there are potentially two problems:

1) The Runes protocol, as far as I know, doesn't provide a mechanism for address blacklists like those used by USDT and USDC in their ERC-20 incarnations. So probably the big, ultra-regulated stablecoin issuers would not want to build a stablecoin with that protocol (this might be actually good, because these blacklists are totally against the censorship resistance paradigm, but many people would surely love to see USDT/USDC on Runes  ). Perhaps this will limit stablecoins on Runes to "informal" DAOs like BAMK or to smaller companies from countries without strict stablecoin regulations. Perhaps from Argentina? (there are actually some small stablecoin issuers in ARG, like Num Finance, but I don't know the regulation in detail).

2) Runes also provides no advanced scripting abilities, which would be necessary to create an algorithmic stablecoin.

Plus I believe an on-chain Lending/Borrowing protocol for Bitcoin through Runes should be built because many RICH Bitcoiners want to OWN Bitcoin, not sell. Who is building this?

As already written currently there are no scripting possibilities on Runes. They are tailored to the BRC-20 "etch -> mint -> speculate" paradigm, more suitable for memecoins. One can probably build such a protocol on top of Runes but that would need an effort as big as the Runes protocol itself.

Perhaps it might be better to create some kind of multi-token API standard for wallets, which can be extended by Runes, but also by older protocols like Omni, and also by newer ones like Taproot Assets / RGB. The standard would basically cover the operations for wallet software and Lightning implementations. In this case, a lending protocol could be done with the most scriptable "base protocol", which in my understanding is RGB.

[Wind_FURY]

you do get my perspective that the Runes protocol + the Lightning combination to build a fast, scalable stablecoin might work, no?

I actually would love to see that. However, there are potentially two problems:

1) The Runes protocol, as far as I know, doesn't provide a mechanism for address blacklists like those used by USDT and USDC in their ERC-20 incarnations. So probably the big, ultra-regulated stablecoin issuers would not want to build a stablecoin with that protocol (this might be actually good, because these blacklists are totally against the censorship resistance paradigm, but many people would surely love to see USDT/USDC on Runes  ). Perhaps this will limit stablecoins on Runes to "informal" DAOs like BAMK or to smaller companies from countries without strict stablecoin regulations. Perhaps from Argentina? (there are actually some small stablecoin issuers in ARG, like Num Finance, but I don't know the regulation in detail).

2) Runes also provides no advanced scripting abilities, which would be necessary to create an algorithmic stablecoin.

Whatever the technical hindrances are, whether they'll have or won't have solutions, it still doesn't change the fact that a on-chain stablecoin primitive is needed, and actually more convenient for those users who don't want to send their coins to centralized exchange or to use other blockchains.

Plus I believe an on-chain Lending/Borrowing protocol for Bitcoin through Runes should be built because many RICH Bitcoiners want to OWN Bitcoin, not sell. Who is building this?

As already written currently there are no scripting possibilities on Runes. They are tailored to the BRC-20 "etch -> mint -> speculate" paradigm, more suitable for memecoins. One can probably build such a protocol on top of Runes but that would need an effort as big as the Runes protocol itself.

Perhaps it might be better to create some kind of multi-token API standard for wallets, which can be extended by Runes, but also by older protocols like Omni, and also by newer ones like Taproot Assets / RGB. The standard would basically cover the operations for wallet software and Lightning implementations. In this case, a lending protocol could be done with the most scriptable "base protocol", which in my understanding is RGB.

  👍

[Wind_FURY]

This is why I have debated  for the Runes protocol to be used for something more useful, like a stablecoin that resided on-chain in the Bitcoin Blockchain. But what's actually the "fad" here?

 - Is it shitcoining? I believe not. It also exists in legacy markets.
 - Is it the concept of memecoins? Probably not. Dogecoin still exists and has become a "brand".
 - Is it the Runes protocol? Definitely not. It could also be used for something more useful like native stablecoins.

 ¯\_(ツ)_/¯

Plus people love their dick pics and fart sounds in the blockchain.

It's also laughable that they compare Runes to Counterparty.

Ordinals, Inscriptions, and Runes Appear To Be No More Than a Fad (So Far)

One potential solution brought forward to combat the lack of network fees have been Ordinals,
inscriptions, and Runes. During the April 2024 halving, the Runes protocol launched, creating an influx of
transaction fees that was short lived.

These events do create meaningful revenue for miners able to find a block during the fleeting mania that
ensues. However, this mania comes at the expense of the speculators who often pay exorbitant fees to
complete their transaction only to see their newly acquired digital token experience high levels of volatility
with a downward trend over time. The halving block specifically had 37.62 bitcoin in fees, worth over
$2 million.5

Simply put, Runes are just another way to launch and trade “meme” coins, like the popular altcoin ecosys-
tems of Ethereum and Solana. There is nothing novel about Runes or Ordinals to sustain the mining space
long term. In fact, we may have already seen the bubble burst as network fees continue to remain low
since the April halving spike.

Runes had become the latest in a long line of speculative fads within the digital asset ecosystem. What
started with Ordinals or Bitcoin-adjacent non-fungible tokens gave way to the next logical progression:
Runes, or Bitcoin-adjacent fungible tokens.

Fidelity 2025 Forecast

[nutildah]

It's also laughable that they compare Runes to Counterparty.

They are similar in that they both exist on Bitcoin and require an external protocol to enforce the rules of the system. Counterparty has several more features and an in-built DEX, but Runes has... well it has influencers behind it that launch pump n dumps which make it more exciting. Yeah sorry but there's nothing redeeming about it.

[Wind_FURY]

It's also laughable that they compare Runes to Counterparty.

They are similar in that they both exist on Bitcoin and require an external protocol to enforce the rules of the system. Counterparty has several more features and an in-built DEX, but Runes has... well it has influencers behind it that launch pump n dumps which make it more exciting. Yeah sorry but there's nothing redeeming about it.

Ser, I'm not laughing at them because I believe that one protocol is better than the other. I laughed at them for the mere comparison of it because technically they are, in fact, different. Plus to call them a "fad" because "memecoins'. Memecoins as a concept are not fads. They have become a part of the culture.

Plus saying that Runes only has "influencers" without acknowledging what it technically truly is, nor not acknowledging what it could actually do is intellectually dishonest.

[d5000]

@Wind_FURY: Your link didn't work for me, this one, does

I have not found the comparison to Counterparty - it would have been interesting. The main difference is for sure that XCP needs an auxiliary token (the XCP token) for all operations within the system (just like Omni), while Runes does not build on such an auxiliary token.

This seems like an advantage. However, this makes the Runes system also less expressive. Runes basically only is able to manage some attributes of the token (like the number of decimals, name etc.) but does not provide a DEX natively. Such a DEX is possible with Bitcoin Script (and thus, with Runes) but the types of operations and orders are limited. The advantage of an auxiliary currency like XCP is that it can provide more features for such DEXes.

I've already written it elsewhere but Runes does remind me a lot of PeerAssets, a token protocol developed in the Peercoin community which also works on Bitcoin and potentially other coins.

Anyway I think systems based on newer tech like BitVM2 will probably eventually replace Runes, XCP, Omni and most other protocols.

By the way an article comparing Runes to other token protocols can be read here: https://www.binance.com/en/square/post/5421177183297 .

[nutildah]

Ser, I'm not laughing at them because I believe that one protocol is better than the other. I laughed at them for the mere comparison of it because technically they are, in fact, different. Plus to call them a "fad" because "memecoins'. Memecoins as a concept are not fads. They have become a part of the culture.

Okay, watch as all runes trend to zero this year. Memecoins won't always pump as hard as they have over the last year, so yeah, memecoins pumping is definitely a fad. Its weird for someone with any knowledge of trends or cycles to claim otherwise.

Plus saying that Runes only has "influencers" without acknowledging what it technically truly is, nor not acknowledging what it could actually do is intellectually dishonest.

What it technically truly is has been discussed ad nauseum already. Its an extremely simple tokenization system. In a way its pretty elegant, but ultimately useless. Disagree? Find me one rune that wasn't expressly created to be an inherently valueless pump n dump. (I can name some artistic-driven ones but I bet you can't).

The main difference is for sure that XCP needs an auxiliary token (the XCP token) for all operations within the system

Its actually just used for the creation of assets and dividend payments (so people can't mass spam the system). Sends & other functions (order placement, supply increase/destroy/lock, description changes) only require the BTC tx fee.

[NotATether]

My crystal ball tells me that as the Trump administration makes real cryptocurrency more popular (like Bitcoin, ETH, tokens on ETH), things like Runes are going to be forgotten and slowly die off.

[Wind_FURY]

My crystal ball tells me that as the Trump administration makes real cryptocurrency more popular (like Bitcoin, ETH, tokens on ETH), things like Runes are going to be forgotten and slowly die off.

It's actually dead/forgotten right now, but it's NOT or NOT will be because of the Trump administration's actions. It's simply a UX problem when building things directly on top of the Bitcoin blockchain.

It's truly disappointing because the potential to unlock billions of liquidity is right there! A sort of stablecoin application in Bitcoin through Runes would have brought something useful for the network onchain.

[nutildah]

It's truly disappointing because the potential to unlock billions of liquidity is right there! A sort of stablecoin application in Bitcoin through Runes would have brought something useful for the network onchain.

There was already USDT on Omni, but Tether decided to stop supporting it in 2023:

https://www.coindesk.com/business/2023/08/17/tether-stops-support-for-bitcoin-layer-omni-citing-lack-of-demand

No matter how USDT is executed on Bitcoin, it will still be considered slow AF due to 10-minute block times. So I don't think it would be a popular choice.

Besides, the Runes protocol would have to be changed to allow for USDT Runes to be frozen at Tether's discretion, as it can be frozen on ETH and TRON. I mean, nobody can technically freeze sats not under their control, but the protocol could render certain "blacklisted" USDT to be worthless or no longer USDT-colored.

[Wind_FURY]

It's truly disappointing because the potential to unlock billions of liquidity is right there! A sort of stablecoin application in Bitcoin through Runes would have brought something useful for the network onchain.

There was already USDT on Omni, but Tether decided to stop supporting it in 2023:

https://www.coindesk.com/business/2023/08/17/tether-stops-support-for-bitcoin-layer-omni-citing-lack-of-demand

No matter how USDT is executed on Bitcoin, it will still be considered slow AF due to 10-minute block times. So I don't think it would be a popular choice.

That's true. It's largely a UX problem than anything else. Although, Casey Rodarmor also said that because the Runes protocol is UTXO-based, it could be implemented to use the Lightning Network.

 🤔

Besides, the Runes protocol would have to be changed to allow for USDT Runes to be frozen at Tether's discretion, as it can be frozen on ETH and TRON. I mean, nobody can technically freeze sats not under their control, but the protocol could render certain "blacklisted" USDT to be worthless or no longer USDT-colored.

That isn't why Tether moved to Ethereum and Tron though?

Speaking of Tether, they're projected to be one of the largest holders of U.S. Treasuries by 2030. Projected to be larger than China. 👀

[nutildah]

That isn't why Tether moved to Ethereum and Tron though?

Assuredly the move was in part due to the more sophisticated/interoperable contract functionalities that these blockchains have. But in 2017, Tether promoted a hard fork to Omni that would allow the freezing of funds in response to a $31M hack of Omni USDT earlier that year. So the protocol does have the fund freeze functionality.

https://www.financemagnates.com/cryptocurrency/news/tether-plans-freeze-31-million-worth-stolen-token/

I really don't think it has many users anymore, however.

BTW, TIL that Tether will continue honoring conversions of Omni USDT until Sep 1st of this year.