The year 2024 saw the rise of the Runes protocol on the Bitcoin network, which consistently had the highest bandwidth among all protocols. However, in December, the transactions on the Runes protocol dropped significantly, falling below the highs reached earlier in the year.
A Record-Breaking Start
On April 23, 2024, the Runes protocol set a record with over 753,000 transactions, surpassing the Ordinals protocol, BRC-20s, and Bitcoin (BTC) itself. This accounted for more than 81% of all transactions in the Bitcoin blockchain at that time (Source: Dune).
A Sudden Decline
The momentum continued through May, but suddenly tanked in the middle of the month. The protocol then saw a significant increase in transactions throughout June, only to drop by over 88% towards the end of the month.
Initial Success and Then Decline
Despite its initial success, the Runes protocol’s transaction share plummeted in July, averaging less than 9% on average. This decline was likely due to a decrease in investor interest in Bitcoin-based non-fungible tokens (NFTs).
Longevity Potential
However, the protocol showed potential for longevity after recording more than 15 million transactions in its first four months. By August, the protocol had generated over $160 million in fees and reached 15.6 million NFT transactions.
A Brief Resurgence
The Runes protocol experienced a brief resurgence during August, with Aug. 23 recording 255,000 transactions. However, this was short-lived, as transactions dropped again in September and have struggled to reach their previous highs throughout the last quarter of 2024.
Decline in Interest
In December, the decline in interest in Bitcoin Runes continued, with the protocol having a transaction share of less than 10% throughout the month. However, on Christmas Day, the protocol had a 19.9% share in Bitcoin transactions (Source: Dune).
A Broader Trend
The decline in interest in Bitcoin Runes comes amid a broader decrease in interest in NFTs. In 2024, NFTs experienced a seven-month downturn before briefly recovering in November and December.
Lowest Point for NFT Sales
NFT sales hit their lowest point in September when monthly sales volumes for digital collectibles dropped below $300 million for the first time since 2021.
A Decline in Interest
The decline in interest in Bitcoin Runes and NFTs as a whole is likely due to several factors, including changing market conditions and shifting investor preferences.
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