New Generation Bitcoin Issue Coin Protocol: Can Runes Surpass ERC20 to Become Mainstream?

As the first major coin issuance standard in the field of cryptocurrency, the ERC20 protocol has made a tremendous contribution to the Ethereum ecosystem. It not only propelled Ethereum to become the most mainstream smart contract platform but also gave rise to the emergence of decentralized finance ( DeFi ), providing project parties with more convenient financing channels.

Currently, many emerging public chains are trying to replicate Ethereum's successful path by creating their own token standards. To achieve this goal, new public chains need to have a sufficiently large market capitalization to establish a foundation, while also innovating in the issue coin protocol to gain recognition from users and the community.

In the current environment, the Runes protocol is considered the most likely to surpass the ERC20 coin issuance standard. Its advantages are mainly reflected in three aspects:

1. Bitcoin's market value accounts for half of the entire cryptocurrency market, providing a solid foundation for Runes.

2. The emergence of BRC20 inscriptions has introduced an innovative mechanism for fair issuance, which has received widespread support from the community.

3. The Runes protocol has been improved based on BRC20, integrating the advantages of both BRC20 and ERC20, and serves as an asset issuance protocol on the Bitcoin mainnet.

The core feature of the Runes protocol is to use the OP_RETURN field in the UTXO to record operational information such as the deployment, minting, and transfer of tokens. It allows issuers to flexibly choose between fair issuance, team allocation, or a combination of both.

Compared to BRC20, Runes have the following advantages:

• A more flexible coin issuance method is beneficial for team financing.
• Simplified trading process, no extra engraving steps required.
• Support concurrent transactions to improve efficiency

Compared to ERC20, the characteristics of Runes include:

• Based on the Bitcoin network, with a more solid foundation
• As an emerging protocol, it has greater development potential.
• Compatible fair issuance mechanism, in line with current market trends
• Complex business applications can be realized through the Bitcoin layer two network.

The Runes protocol has detailed designs for token deployment, minting, and transfer. It supports various launch methods, allowing project parties to fully control token distribution while also enabling fair minting. At the same time, Runes' transfer mechanism effectively records and transmits token information using UTXO and OP_RETURN.

As the cryptocurrency market continues to evolve, whether the Runes protocol can truly surpass ERC20 to become the mainstream issue coin standard remains to be seen. However, it undoubtedly brings new possibilities to the Bitcoin network and provides more options for asset issuance.