- Since setting the bar high with its launch, Runes has struggled to live up to its hype.
- Runes activity hits rock bottom in June.
- The decline could be attributed to Bitcoin miners leaving the network searching for better opportunities.
Earlier this year, Runes, a protocol created to bring meme coins to Bitcoin, was celebrated as miners’ saving grace post-halving. There was widespread anticipation that Runes could drive up transaction fees and offset the impact of the reduced rewards.
However, despite these ambitions, Runes is struggling to meet the hype as miners assess if it’s profitable to continue operating now that their revenue is only half of what it used to be.
Runes Bears the Brunt of Bitcoin Miners Leaving
Bitcoin-based protocols, particularly Runes, are feeling the strain of the network’s miner exodus. The decline in miners and network activity has significantly impacted Runes’ dominance in June.
Sponsored
According to a Dune Analytics dashboard, Runes’ daily average transaction count has plummeted to 37,820 in the past week, marking a near 90% drop from its earlier June peak of over 300,000 daily transactions.
During the same period, the protocol recorded its lowest transaction volume since the halving, pulling around 23,000 transactions—approximately 5% of all Bitcoin transactions. This marks a significant shift from when Runes accounted for up to 61% of all Bitcoin transactions earlier in June.
The sharp decline in Runes’ numbers has also had a massive impact on Bitcoin miner revenue, which is still reeling from the effects of the halving. Interestingly, the impact of miners leaving the network isn’t limited to Runes alone but extends to other protocols like Ordinals, which was once renowned for congesting the network with its hype.
Ordinals Also Suffer From Miner Exodus
Although Ordinals have had a head start on Runes, launching in January 2023, Ordinal activity has also fallen sharply since the halving, dropping to an average of 20,000 daily inscriptions this month, a fraction of what was seen at their November 2023 peak when daily inscriptions would hover around the 480,000 mark, according to data from Dune.
Sponsored
Throughout June, Ordinals struggled to claim even 3% of Bitcoin’s transaction volume, highlighting their diminishing impact. Daily fees generated by Ordinals have similarly nosedived, dwindling to a meager 0.5 bitcoin at press time.
With Runes and Ordinals activity flatlining, Bitcoin miners are feeling the pinch and are compelled to consider scaling back their operations.
Miners Capitulate as Runes and Ordinals Flatline
Many miners are closing shop amid the current network conditions, contributing to a significant decline in Bitcoin’s difficulty, which has dropped from 88.1 trillion hashes to 83 trillion hashes at the time of writing.
In addition to the drop in difficulty, miners have been grappling with record-low revenue per terahash per second (TH/s) over the past two months.
According to data from CoinWarz, miner revenue has plunged from $0.12 pre-halving to just $0.05 at press time– a 58% decrease. Total daily mining revenue has also taken a massive hit, dropping from $107 million to $29.9 million since the halving. During this period, Bitcoin miner reserves also plummeted to 1.90 million Bitcoin on June 19– the lowest in over 14 years.
On the Flipside
- It would be unfair to call Runes a flop, considering the protocol is still in its nascency.
- Meme coins such as WIF, PEPE, and FLOKI were the best-performing tokens this year, even exceeding Bitcoin.
Why This Matters
Runes’ recent downturn could be seen as a natural correction as the protocol finds its ceiling and floor. The protocol continues to perform exceptionally well, with collections already surpassing market caps exceeding $100 million.
Crypto market braces for impact:
Crypto Market Anticipates $730M Impact From July Token Unlocks
Bitcoin weekend trading volumes spiral:
Bitcoin Weekend Trading Volumes Hit Record Low in 2024
