Key Points
- Franklin Templeton predicts Runes token standard will boost Bitcoin’s DeFi and NFT activities.
- Runes could help Bitcoin compete with Solana and Ethereum in the fungible digital assets market.
Franklin Templeton, a prominent investment firm, is optimistic about the potential of the Runes, a new fungible token standard for Bitcoin. The firm believes that this new standard could significantly enhance DeFi and NFT activities on the Bitcoin blockchain ecosystem.
The Potential of Runes
According to Franklin Templeton, Runes could bridge the gap between Bitcoin, Solana, and Ethereum in the realm of fungible digital assets. The firm has stated that the fungible token market for Bitcoin is relatively small compared to Ethereum and Solana. However, with the introduction of Runes, Bitcoin could effectively close this gap.
Leonidas, a spokesperson for Runestone, responded to Franklin Templeton’s endorsement of Runes by stating, “Franklin Templeton is bullish on Runes, and somehow I know most of you guys will mid-curve this.”
In the past, Franklin Templeton has recognized the role of the BRC-20 standard in the rapid growth of fungible tokens on the Bitcoin blockchain. However, the firm has also noted that the burn and minting process of the BRC-20 standard creates a large amount of junk UTXO, or Unspent Transaction Output.
Addressing the UTXO Problem
Franklin Templeton Digital Assets believes that the launch of the Runes protocol could solve the UTXO problem by eliminating any junk UTXOs. The Runes protocol could reduce the dependency on off-chain data or additional tokens while offering greater privacy and compatibility within the Bitcoin Lightning network.
Franklin Templeton has also shown interest in other emerging digital assets, such as Ordinals, praising them for igniting a “Renaissance in BTC activity.” The firm has highlighted NodeMonkes, Runestone, Bitcoin Puppets, Ordinal Maxi Biz, and Bitmap, which collectively have a market capitalization of $1.11 billion.
As the Bitcoin halving 2024 approaches, the BRC-20 tokens have experienced a sharp correction. For example, the Ordi. (ORDI) token price has dropped by 40% in the last seven days.
