Bijie.com reported:
A few months ago, the Bitcoin ecosystem was booming because of the trade of inscriptions and runes, and the on-chain congestion often resulted in fees of up to hundreds of satoshis per byte. Many new projects and users from all walks of life actively joined this track. However, the cycle belonging to the Bitcoin ecosystem seems to be particularly short. Recently, the Bitcoin on-chain has fallen silent, and the fees have returned to an average level of 10 satoshis per byte. Compared to the currently popular TON ecosystem and Solana ecosystem, the Bitcoin ecosystem is cooler (and once again close to the underestimated area).
So, can inscriptions and runes return to glory? Is there still a second spring as people say? Does the Bitcoin ecosystem still have a chance in this bull market?
Since the beginning of this year, inscriptions have gradually decreased to freezing point. Inscriptions were once the protagonist of the Bitcoin ecosystem and the most recognized asset issuance protocol with the most complete infrastructure construction. Although there have been countless new asset issuance protocols born in the Bitcoin ecosystem in the past year, such as Atomicals, Tap, Taproot Assets, etc., none of them have shaken the dominant position of inscriptions in the Bitcoin ecosystem.
However, since the second wave of inscription market in February this year, when Runes protocol, which had been preheated for half a year, further grabbed the market heat in April, inscriptions have fallen to freezing point.
The second wave of inscription market started in November 2023, with BRC 20 and Ordinals accounting for an average of over 50% of the daily trading volume on the Bitcoin chain. However, by February this year, the market took a sharp turn, and inscription trading on the chain declined. Conventional Bitcoin transactions on the chain regained over 60% of the trading volume, marking the end of the crazy market for inscriptions for more than three months.
At the same time, with the Bitcoin halving on April 20, the Runes protocol officially went live, and the Bitcoin ecosystem became lively again. Many project parties, in order to grab the front rune number, raised the on-chain gas to a level of over 2300 satoshis per byte, and the fierce competition also made the miners’ transaction fee income reach a record high of 1070 BTC per day.
“Born of the same root, why is it so anxious to fry” Although the founders of the Inscriptions protocol and the Runes protocol are both Casey, the heat of Runes has not spread to Ordinals. Since the launch of the Runes protocol, the daily trading volume of Runes on the Bitcoin chain has accounted for more than 50%, while the trading volume of Ordinals has further decreased, with an average of only about 5% daily.
From the data perspective, the freezing point reached by inscriptions today is similar to that of October 2023. The difference is that inscriptions were only silent for more than a month at that time, but in this cycle, it has become more difficult for inscriptions to regain their popularity because of the addition of Runes.
Active on the rune chain, but the market is not good
Although runes have remained active on the chain since their launch, with a daily trading volume share of over 50%, the actual market for runes is not good.
Even though the new high market value of runes has caused a short-term boom in the primary market, there are still few people taking over these new assets in the secondary market. 80% of the new targets will return to zero after casting, and most of the funds are concentrated in the top few rune projects.
However, after reaching a new high market value in early June, the market for runes began to oscillate and fall. Not only did the trading volume shrink, but the top assets also experienced daily declines.
The fundamental reason for the discrepancy between on-chain activity and price market is that the entire ecosystem has entered a bear market, with no new funds entering, leaving only old players in the PVP field. At the same time, on social media, players who still insist on playing in the runes track have also come up with a set of methodologies: Before playing, look at the total amount and overseas community atmosphere. If the total amount is too large and the current funds cannot be digested, there may be a huge selling pressure without the participation of overseas communities. During the game, if you are lucky enough to run into a blockage and the on-chain transaction fees rise, the rising costs will make the early casters profitable. After playing, see if there are any celebrities or project parties who can attract attention and hope.
Essentially, this strategy is also a helpless move to force the bear market without new funds entering.
Can new narratives and new gameplay revive the Bitcoin ecosystem?
Looking back at the bull market of the Bitcoin ecosystem, the first large-scale Bitcoin bull market from May to July 2023 was caused by BRC 20, which was the first large-scale spread of the Bitcoin ecosystem asset issuance narrative, attracting a large number of users, projects, and investors. The second large-scale Bitcoin bull market from November 2023 to February this year was caused by the narrative of BRC 20 and the accessibility of inscriptions on various chains. The listing of ORDI and other head BRC 20 assets on Binance made the inscription gameplay no longer confined to the chain, and the issuance of inscriptions by various chains brought the wealth effect of inscriptions to various chains, allowing public chains to gain a large amount of traffic and attention. The brief third large-scale Bitcoin bull market in April 2024 was caused by the launch of the Runes protocol and the airdrop gameplay. The biggest innovation of the Runes protocol is the creation of pre-mining and large-scale community airdrop gameplay. However, due to the preheating for almost half a year, the Runes protocol went online and concentrated all the good news and market sentiment in one month, leading to the quick end of the bull market.
In summary, it can be seen that the various outbreaks of the Bitcoin ecosystem have been driven by new narratives, new gameplay, or new innovations. In each cycle, assets with odds that are higher than or equal to returns from previous head targets will always appear.
We currently need such innovations to break the silence of the Bitcoin ecosystem and attract new users and funds. Many projects are also trying various innovations, such as the 5-character BRC 20 pizza airdrop by unisat and the recently discussed programmable runes, etc.
Based on past experience, the cycle of the Bitcoin ecosystem changes quickly, with new things always appearing after a silence of 3-6 months. So, if there are any new and innovative things in the Bitcoin ecosystem in the future, everyone can pay attention and participate. New things always bring new liquidity.
Later, we will bring you an analysis of the leading projects in other tracks. If you are interested, you can follow us. I will also occasionally organize some cutting-edge information and project reviews. Welcome all like-minded people in the coin circle to explore together. If you have any questions, you can comment, ask questions, or message.
