Franlin Templeton Digital Assets noted that the launch of the Runes protocol will come with several improvements while eliminating any junk UTXOs.
Apart from being just a store of value, the Bitcoin blockchain ecosystem is gaining popularity for DeFi and NFT activities taking place on the network. Investment firm Franklin Templeton believes that the launch of Runes, the new fungible token standard for Bitcoin, could be a game changer for the ecosystem.
As per Franklin, Runes would help Bitcoin close the gap with Solana and Ethereum in the fungible digital assets space. Speaking on the development further, the investment firm added:
“Currently the fungible token market for Bitcoin is quite small in comparison to ETH and SOL.However, with the launch of a more efficient token standard (Runes), Bitcoin is positioned well to close the gap between its fungible market cap versus that of other blockchains.”
Responding to Franklin Templeton’s tweet, Runestone spokesperson Leonidas said: With “1.4 trillion [assets under management], Franklin Templeton is bullish on Runes, and somehow I know most of you guys will mid-curve this”.
1.4T AUM Franklin Templeton is bullish on Runes and somehow I know most of you guys will mid curve this
— Leonidas (@LeonidasNFT) April 15, 2024
In the past, Franklin Templeton acknowledged the role of the BRC-20 standard in the rapid surge of fungible tokens hosted on the Bitcoin blockchain. However, the firm added that the burn and the minting process of the BRC-20 standard creates a large amount of junk UTXO, or Unspent Transaction Output (UTXO).
UTXO usually bloats the network while driving fees higher as some Bitcoin fragments persist even after the transactions. This leads to the accumulation of unspent funds within the subsequent transactions.
Runes Protocol to Solve the UTXO Problem
As per the Franlink Templeton Digital Assets, the launch of the Runes protocol will come with several improvements while eliminating any junk UTXOs. The Runes protocol will reduce the dependency on any off-chain data or additional tokens while simultaneously offering greater privacy and compatibility within the Bitcoin Lightning network.
Runes are not the sole emerging digital asset capturing Franklin Templeton’s interest. Just this month, the firm praised Ordinals for igniting a “Renaissance in BTC activity,” spotlighting NodeMonkes, Runestone, Bitcoin Puppets, Ordinal Maxi Biz, and Bitmap, collectively boasting a market capitalization of $1.11 billion. Previously, the Franklin Templeton Digital Assets noted:
“In the past year, Bitcoin innovation and development has seen a renaissance in activity. Positive momentum in innovations is primarily driven through Bitcoin NFTs, known as Ordinals, new fungible token starts such as BRC-20 and Runes, Bitcoin Layer 2s, and other Bitcoin DeFi primitives.”
While Bitcoin halving 2024 is just a few days away, the BRC-20 tokens have witnessed sharp correction beforehand. For e.g. in the last seven days, the Ordi. (ORDI) token price has dropped by 40%.
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