Franklin Templeton Digital Assets recently heralded the launch of Runes, aiming to bridge the gap between Bitcoin and top cryptocurrencies like Ethereum and Solana in the fungible digital asset realm. This move marks a strategic push to bolster Bitcoin’s versatility and market competitiveness in the crypto sphere.
The investment firm’s report noted the comparatively modest size of Bitcoin’s fungible token market vis-à-vis Ethereum (ETH) and Solana (SOL). However, with Runes’ introduction as a more efficient token standard, Franklin Templeton anticipates a significant surge in Bitcoin’s fungible market cap, positioning it as a strong contender among diverse blockchain ecosystems.
“Currently, Bitcoin’s fungible token market is relatively small compared to ETH and SOL,” the firm remarked. “However, with Runes’ launch, Bitcoin is poised to close the gap in fungible market cap versus other blockchains.”
The announcement garnered attention from both the crypto community and Runestone, expressing bullish sentiments towards Runes and Franklin Templeton’s endorsement. “With 1.4 trillion [assets under management], Franklin Templeton is bullish on Runes,” said Leonidas, responding to the firm’s tweet.
While acknowledging the role of the BRC-20 standard in promoting fungible tokens on Bitcoin, the Franklin Templeton report highlighted a downside – the creation of junk Unspent Transaction Output (UTXO) due to the standard’s burn and minting process. This UTXO bloats the network and increases transaction fees, affecting the efficiency and cost-effectiveness of using fungible tokens on Bitcoin.
As the Bitcoin halving event nears, BRC-20 tokens have faced challenges, with declines observed in tokens like Ordi (ORDI). This decline, noted by blockchain intelligence company LunarCrush, may reflect a shift in sentiment towards Runes over BRC-20 tokens.
“It could be people more bullish on Runes, meaning less positive sentiment on BRC-20 versus actual negative sentiment,” explained LunarCrush co-founder and CEO Joe Vezzani.
Looking ahead, Franklin Templeton Digital Assets anticipates substantial improvements with the Runes protocol’s launch, including addressing the UTXO issue, eliminating reliance on off-chain data, streamlining token management, and enhancing privacy and compatibility with the Bitcoin Lightning Network.
Runes is not the sole digital asset gaining traction in Franklin Templeton’s radar. The investment firm also highlighted Ordinals as catalysts for increased Bitcoin activity, recognizing projects like NodeMonkes, Runestone, Bitcoin Puppets, Ordinal Maxi Biz, and Bitmap with a combined market capitalization of $1.11 billion. This diverse array of innovations underscores a renaissance in Bitcoin development and innovation, characterized by NFTs, new fungible tokens, Layer 2 solutions, and DeFi primitives.
In a separate report, Franklin Templeton projected a surge in crypto users, estimating the total number to exceed 1.2 billion by 2025, indicating a growing mainstream adoption and acceptance of digital assets globally.
Despite industry attempts to gain further insights, Franklin Templeton Digital Assets has not responded yet, leaving the crypto community eagerly anticipating more developments and insights from this influential investment firm.
