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Contents
- What are Inscriptions, Ordinals, and Runes?
- What makes Runes better than BRC-20?
- Why do Runes have such long names?
- What will Runes be used for?
- What are some popular Bitcoin Rune projects?
- How can you mint, buy, and sell Runes?
- How do you use a wallet to back up and protect your Runes?
- How do you ensure inheritance of Bitcoin Runes?
- How can Vault12 Guard protect your Bitcoin Runes?
NFTs
What are Inscriptions, Ordinals, and Runes?
We recently shared the story about how in 2023, the Ordinals protocol was added to the Bitcoin network. Users began to use Ordinals to inscribe unique data (NFT "inscriptions") directly onto Bitcoin satoshis, and soon thereafter, Ordinals inscriptions enabled the creation of fungible BRC-20 tokens on the Bitcoin blockchain. Inscription-based Bitcoin NFTs and BRC-20 tokens expanded the Bitcoin landscape to encompass both fungible and non-fungible tokens. BRC-20 tokens became fairly popular and achieved a market cap exceeding $2 billion.
Then in September 2023, just as Ordinals was reaching peak popularity, the same developer behind Ordinals, Casey Rodarmor, proposed another new protocol for tokens on Bitcoin: Runes. Runes introduces a fresh token standard for Bitcoin, and streamlines the process of creating fungible tokens, enhancing efficiency for users. The motivation behind Runes was to improve upon BRC-20.
Runes launched at the same time as the April 20, 2024 Bitcoin halving event, at network block 840,000.
What makes Runes better than BRC-20?
Runes aligns more closely than BRC-20 with the Bitcoin community’s values and unwritten rules, like protocol simplicity, independence of off-chain data, and using unspent transaction outputs (UTXOs) as a state model. Runes also uses a smaller blockchain footprint, thus avoiding the perception that it is filling up the Bitcoin blockchain with “garbage” data.
In contrast to the complexity of BRC-20, the simple rules of Runes tokens allow the tokens to be included in many wallets, requiring only relatively minor modifications by wallet developers.
If you are interested in learning more about how the Runes protocol works, you can read more about it in the Ordinals documentation.
Why do Runes have such long names?
Runes have a unique, forward-looking characteristic of ticker naming: shorter names for individual Runes will be unlocked (allowed) over time. This rule is intended to prevent a rush of front-running and "squatting" more attractive, shorter names. At first, only Rune names of thirteen or more characters are unlocked, which is why (depending on when you read this article) you might only see Runes with long names avaliable for mint and sale. An example of an early Rune name is "UNCOMMONGOODS."
How quickly are shorter names unlocked? Runes was unlocked at block 840,000, and after that, the completion of every 17,500 blocks (which takes about four months) unlocks the next-smaller length of Rune name availability. The next unlocking of shorter Rune ticket names is expected in September, 2024.
What will Runes be used for?
Initially, we will inevitably see a lot of meme Runes traded, since they are so simple to create. There are more "serious" Runes projects in the works, but it’s hard to predict which will be successful, and when more value-added Runes-based projects will be available.
What are some popular Bitcoin Rune projects?
You can follow along with which Runes projects are new and most popular at several online Runes explorers, including Ordiscan.
How can you mint, buy, and sell Runes?
Platforms like Ordinalbots can make the process of "etching" and minting Runes simple. "Etching" sets the properties of Runes, and “minting” creates new ones that may then be transferred.
Trading platforms like Magic Eden already support Runes purchases and sales. OKX is another.
Always do your own research and/or consult with a professional if you're unsure about anything.
How do you use a wallet to back up and protect your Runes?
Runes-capable wallets operate like other crypto wallets. To buy some Runes and back them up:
- Create an account, secure your seed phrase backup, and deposit funds into your choice of Runes-capable wallet.
- Create or purchase Bitcoin Runes on your platform of choice.
- Use a Runes-compatible Receive address in your wallet to receive the Bitcoin Runes from the marketplace or trading platform you've chosen.
Back up the recovery phrase for your Runes wallet in the same way as you would for any other wallet. If you were to lose access to your wallet without backing up the recovery phrase, you would lose your Runes and anything else in that wallet.
How do you ensure inheritance of Bitcoin Runes?
You must protect your long-term storage and the inheritance of Bitcoin Runes in the same way as you would any other Web3 digital asset.
Web3 asset inheritance is different from the relatively straightforward steps for a traditional inheritance, where you go to the bank or the broker, you tell them that someone has passed on or is incapacitated, and you are given access to those assets. In contrast, with Web3 assets, you, the owner, are responsible for the security and safekeeping of those assets. If you haven't recorded all of the details about your assets and communicated them to the people who will be the beneficiaries, your assets will likely be lost. Even if you did record the details correctly, there are still a lot of ways for heirs to go wrong with complex technical things during the succession process.
Take the risk out of your web3 and Bitcoin asset wallet backups by storing your wallet seed phrases in a specialized digital vault.
How can Vault12 Guard protect your Bitcoin Runes?
Our latest technology release Vault12 Guard is a mobile app designed for ordinary people who are collectors, creators creating digital art and NFTs, and crypto enthusiasts buying cryptocurrency. Vault12 Guard is designed to make it as simple as possible to back up all of your Web3 assets and then assign a beneficiary who can receive those assets in the event of incapacitation or death of the owner.
With Vault12 Guard, it's very simple to back things up for your own recovery. It's very simple to activate Inheritance. And it's very simple for your heirs to retrieve those assets when needed. Download the app from any of the app stores (iOS or Android), install it, create a digital vault, and then you can immediately start adding assets, which will be stored locally on your phone device for full, distributed, decentralized backup and inheritance.
With Vault12 Guard, you can add and assign your own vault Heirs and Guardians. These are people that you know: they could be business partners, family members, or friends who will guard your vault. Your Guardians will grant access to your Web3 assets on the event of your passing.
You can learn more about Crypto Inheritance here, or jump right into learning how to quickly set up your vault to bring longevity and resilience to your digital assets journey.
Wasim Ahmad
Wasim is a serial entrepreneur with five exits, and an advisor in the fields of AI, blockchain, cryptocurrency, and encryption solutions. At Vault12, he led the private and public fundraising efforts, and focuses today on expanding the Vault12 ecosystem. His crypto experience began with AlphaPoint, where he worked with the founding team to launch the world's first crypto trading exchanges.
Previously he was a founding member of Voltage Security, a spinout from Stanford University, that launched Identity-Based Encryption (IBE), a breakthrough in Public Key Cryptography, and pioneered the use of sophisticated data encryption to protect sensitive data across the world's payment systems. Wasim serves on the board of non-profit, StartOut, and is a Seedcamp and WeWork Labs global mentor.
Wasim graduated with a Bachelor of Science degree in Physics and French from the University of Sussex.
Art Krotou
Art is a crypto-security expert and researcher with serial entrepreneurship background. Having a degree in physics and experiences in multiple cutting-edge industries like fintech, secure hardware and semiconductors, and identity gave him a unique multi-faceted perspective on the problem of key management for individuals in the crypto networks and the evolution of the internet in general.
In his current work, he is specifically researching how cryptographic keys can be inherited without posing a threat to 3rd parties in edge cases. In addition, he advocates for "fault-tolerance via secrets automation". He discusses the quantitative impact of user experience factors on the uptake of non-custodial solutions.
As one of his most notable accomplishments, he co-founded and led through the early years of the company that contributed to the complex technology behind Apple's recent M-series CPUs. He is also the creator of the most friendly and aesthetically pleasing, but nonetheless super secure and fault-tolerant hardware wallet - U•HODL.
Check out his curated series of "Vault12 Learn" contributions below, and follow him on Twitter and LinkedIn for more sharp insights.
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