Bitcoin Runes, the new fungible token protocol created by Casey Rodarmor, is off to a rocky start. Indeed, the first and largest Rune, Fehu, has seen its market capitalization plummet by 85% in less than a month, despite being 99% owned by its founder.
A promising launch for Bitcoin Runes
Casey Rodarmor, the father of the Bitcoin Ordinals theory, recently unveiled the Runes, a fungible token protocol designed to disrupt the Bitcoin ecosystem. The Runes aimed to facilitate the creation and tracking of fungible token ownership by exploiting satoshis, Bitcoin’s smallest units.
Building on the success of its previous protocol NFT based on ordinals, which has generated a market worth several billion dollars, Rodarmor gave in to speculators’ expectations by launching Runes. Although he has recognized that 99.9% of fungible tokens were scams and memes. Nevertheless, he developed this new protocol to enable the creation and tracking of fungible tokens via satoshis.
However, the Ordinals of Rodarmor the foundation of the Runes protocol, is controversial. Indeed, tracking satoshis ownership is mathematically impossible without adhering to the following theory: satoshis could persist in blockchain transactions according to a modified first-in, first-out accounting method (FIFO). In reality, all satoshis are completely destroyed and created after each Bitcoin transaction.
A dizzying fall and questions about the future of Runes
The launch of Fehu, the first Rune, was marked by an unprecedented craze. An anonymous engraver paid the colossal sum of 6,732 BTC to inscribe the Rune in the first block of Bitcoin’s fifth epoch. This operation gave Fehu a privileged position and an aura of rarity.
An aggressive marketing campaign soon followed, with bold promises. Visit promoters of Fehu claimed that its market capitalization would exceed that of Dogecoin, the very first and most famous memecoin you know well. On the first day of its creation, Fehu had a staggering valuation of over $17 billion and investors were both incredulous and enthusiastic.
However, it soon became clear that Fehu had all the hallmarks of a classic crypto pump. Indeed, the founder had pre-mined 99% of the total supply. This gave him almost total control over the market. This control allowed him to easily manipulate valuation figures and artificially inflate market capitalization.
A month later, the dream turned into a nightmare for Fehu holders. The price of Rune has collapsed spectacularly, from 249,786 satoshis (about $160) to only 32,000 satoshis (about $20.50) on OKX. Despite the founder’s grip on supply, market capitalization melted like snow in the sun, plunging to $2.3 billion, a staggering 85%.
This resounding collapse casts an ominous shadow over the future of Bitcoin Runes and the protocol developed by Casey Rodarmor. While Fehu was presented as the figurehead of this new generation of fungible tokens, its sudden collapse raises questions about the viability and sustainability of other Runes.
As a journalist at Coinpri, I’ve been captivated by the world of bitcoin and blockchain since 2020. The decentralized aspect of Bitcoin particularly piqued my interest. Since then, I’ve been working constantly to spread my knowledge, hoping one day to see a world where everyone fully enjoys their financial freedom.
