Runes protocol sees significant decline in activity

Activity on the Runes protocol has significantly decreased since its first week of trading. There was a notable decline in activity on May 10, with very few new mints and new wallets interacting with the protocol.

According to a Dune Analytics dashboard, the protocol’s fee revenue has steadily declined. Although Runes still earns hundreds of thousands of dollars daily in fees on the Bitcoin blockchain, the total fees have only surpassed $1 million twice in the last 12 days, indicating a downward trend.

Runes is a new Bitcoin token standard that allows users to create fungible tokens on the blockchain, launched by Ordinals creator Casey Rodarmor. Ordinals enabled nonfungible tokens on Bitcoin.

The Runes protocol debuted on April 20, which coincided with the latest Bitcoin halving event. The launch of Runes triggered a frenzy among investors, leading to a surge in transaction fees and a record-breaking windfall for Bitcoin (BTC) miners, with over $135 million generated in fees during the first week alone.

Data from Dune Analytics shows that until April 24, Runes-related transactions made up the majority of the transactions on the Bitcoin network. On April 23, Runes claimed its highest transaction share of 81.3%, pushing the Bitcoin transaction share down to 18.15%, with Ordinals and BRC-20 transactions at 0.1% each.

Runes transactions dwindled consistently over the next nine days until May 2. From May 3, Runes began to recover, regaining its transaction share above 60% on May 4 and 5.

The mining community welcomed the rising fees, as their earnings dropped significantly following the Bitcoin halving. In May, total revenue for Bitcoin miners dropped to under $30 million per day.

Runes, like Ordinals, launched a new token standard on the Bitcoin blockchain. Bitcoin recently processed its one billionth transaction.

Runes has already achieved significant success, with several Rune collections boasting market capitalizations in the hundreds of millions of dollars, according to data from Magic Eden.

Additionally, Rodarmor recently hinted at an innovative audioreactive generative art project during an Ordinals event in Hong Kong, further showcasing the platform’s potential.