The Bitcoin Ordinals creator proposed creating a new fungible token protocol for Bitcoin.
Posted September 26, 2023 at 2:43 am EST.
Casey Rodarmor, the creator of the Bitcoin Ordinals protocol, suggested a UTXO-based fungible Bitcoin token protocol that would be a “simpler” alternative to complex existing standards like BRC-20.
In a blog post on Monday, Rodarmor proposed the new protocol, dubbed “Runes,” as a way to potentially bring significant transaction fee revenue, developer mindshare, and users to Bitcoin.
New terrible idea just dropped: Runes.
A worse-is-better fungible token protocol for Bitcoin.https://t.co/TPVrUvWxm8
— Casey (@rodarmor) September 25, 2023
“I’m not sure creating a new fungible token protocol for Bitcoin is a good idea. Fungible tokens are 99.9% scams and memes. However, they don’t appear to be going away any time soon, similar to the way in which casinos don’t appear to be going away any time soon,” said Rodarmor.
A simpler model that leaves a smaller on-chain footprint might be a way to reduce the harm from existing protocols, he said.
Rune balances would be held by UTXOs that can contain any amount of any number of runes. Runes to input transactions with an invalid protocol message would be burned, allowing for future upgrades that can change how they are assigned or created by old clients that erroneously assign rune balances.
UTXOs, or “unspent transaction output”, is the technical term that refers to the amount of crypto left in a wallet after a completed transaction, where the balance is used in subsequent transactions and is stored in the UTXO database. Essentially, the UTXO model is used to track ownership of all portions of that particular cryptocurrency.
“Should such a thing exist? I don’t know. It’s about as simple as possible, does not rely on off-chain data, does not have a native token, and fits nicely into Bitcoin’s native UTXO model,” explained Rodarmor.
“Such a scheme might draw users from other schemes with worse on-chain footprints, and bring developer and user mindshare to Bitcoin, encouraging them to adopt Bitcoin itself.”