What’s The Different Between Brc20 And Runes

July 4, 2024/in Bitcoin, Blockchain /by John Ming

Creating fungible tokens on Bitcoin is a concept you may be familiar with, BRC-20 has exceeded 2.4 billion dollars in market capitalization in less than a year.

BRC-20

The new Bitcoin Ordinal inscription system is leveraged by the BRC-20 protocol.

The Bitcoin blockchain has a new feature called inscription that allows us to add unique data to satoshis, which are the smallest units of Bitcoin. This feature allows satoshis to be converted into NFTs, or digital artifacts native to bitcoin.

However, given that there is a finite amount of space in each block of Bitcoin, how was this made possible?

RUNE

Fungible tokens are implemented on Bitcoin through the RUNE protocol, which makes use of OP_RETURN.

The conventional technique for embedding data on the blockchain.

A new communication format named “Runestone” is introduced by the protocol. The RUNE protocol refers to these Runestones as “Etching” or “Edict” in the context of deployment and transfer, respectively.

They are kept in an OP_RETURN output of a transaction.

A RUNE token is deployed via a transaction that includes a “Runestone” with the field “etching”, which describes the token’s properties.

Here some of the difference between these two protocols.

RUNE just needs one transaction for a transfer, but BRC-20 requires three transactions.

This indicates that because there are more transactions for every transfer, BRC-20 has a larger blockchain footprint than RUNE.

BRC-20 operates on an account-based architecture, similar to that of Ethereum, whereas Bitcoin RUNE operates on a UTXO architecture.

Conclusion

The possible uses for BTC Runes and their market influence will only grow as they evolve further. BTC Runes have a strong community and are expected to be a major player in the future of decentralized finance thanks to continuous improvements. Adopting this technology promotes innovation and global blockchain solution adoption in addition to creating new revenue opportunities.

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What are Btc Runes

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