Rune and BRC-20 are just stepping stones to Bitcoin DeFi.
Bitcoin Loon and BRC-20 tokens are just a stepping stone to the development of Bitcoin-based decentralized finance (DeFi).
According to Rich Rines, a key DAO contributor building Bitcoin DeFi solutions, the emergence of Runes and Bitcoin DeFi stemmed from a desire to add more utility to the world’s most secure blockchain network. Rines told Cointelegraph:
“(Bitcoin) started out as a peer-to-peer electronic cash system and has increasingly morphed into a store of value, now protecting $1.5 trillion in wealth. “Over the past year and a half, we have seen a desire to add more utility to native Bitcoin through the emergence of token protocols such as Ordinals, BRC 20s, and Runes.”
Runes is a new protocol for issuing fungible tokens on the Bitcoin network, launched on April 20th, the day of the Bitcoin halving. Loon is part of a broader developer movement known as Bitcoin DeFi, or BTCFi, which aims to add more utility to the Bitcoin network.
According to Rines, Runes has generated widespread excitement among Bitcoin holders, but due to the decentralized nature of the network, a token standard could be a stepping stone in the advancement of BTCFi.
“Because Bitcoin is so decentralized, it’s hard to say whether (runes) will remain the standard. We need to reach some kind of social consensus on some standards that can win. Market demand and people voting with their dollars will ultimately help find the final answer.”
Bitcoin Runes Recovered This Week As of April 20, rune-related transactions accounted for the majority of Bitcoin transactions, or 81.3% of daily BTC transactions, according to Dune Analytics Data.
Related: Robinhood Cryptocurrency Business Takes Hit by SEC Wells Notice.
Bitcoin became a revenue-generating asset for the first time.
To further strengthen the BTCFi innovation, Core Chain launched its first non-custodial Bitcoin (BTC) staking product on April 23, enabling Bitcoin staking without compromising the security of the Bitcoin network. I did.
According to Rines, non-custodial staking offers Bitcoin holders a risk-free profit opportunity because the underlying assets do not need to leave the user’s wallet.
“This is where risk-free, non-custodial Bitcoin staking shines. Bitcoin, which is not fully trustworthy, becomes the first asset to generate returns through rewards for investing in more Bitcoin, creating a reflexive loop.”
Other protocols are also working to create more utility for Bitcoin. On May 6, Hermetica announced the launch of the first Bitcoin-backed synthetic US dollar with yield generation capabilities.
Scheduled for launch in June, USDh will offer yields of up to 25%, aiming to play a pivotal role in providing more liquidity and use cases for BTCFi.
Related: Runes provide a critical lifeline for Bitcoin miners — TeraWulf COO
