Bitcoin Metaprotocols Runes

Runes

Casey Rodarmor's fungible token protocol for Bitcoin. Activated at the 2024 halving (April 2024). Architecturally cleaner than BRC-20 — uses Bitcoin's UTXO model directly.

Mechanics

A Rune's state is encoded in OP_RETURN outputs called runestones:

OP_RETURN OP_13 <protocol_message>

OP_RETURN OP_13 (0x6a 0x5d) is the Rune protocol marker.

The protocol message is varint-encoded, specifying:

• Edicts — transfer instructions (rune ID, amount, output index).
• Etching — issuance of new rune.
• Pointer — default output for unspecified rune balances.

Rune ID

Identified by <block>:<tx_index> of the etching tx. E.g., 840000:1 = the 2nd Rune etched at block 840000.

Etching (issuance)

runestone {
    etching {
        rune: "BITCOIN.MAGAZINE",
        symbol: "B",
        divisibility: 8,
        spacers: 1024,            // visual spacing in display
        premine: 1000,           // amount to etcher
        terms {
            cap: 21_000_000,
            amount: 100,         // per-mint amount
            height: [840000, 1000000],   // mintable in this block range
            offset: [0, 525960],          // or relative-time
        }
    }
}

Mint

runestone {
    mint: 840000:1,    // mint this rune
}

Mint is allowed if:

• The rune has open mint (cap not reached, time/block in range).
• Sender provides enough fee (no specific token gating).

Transfer

runestone {
    edicts: [
        { id: 840000:1, amount: 100, output: 1 },
    ],
}

Output 1 receives 100 of rune 840000:1. Rest of rune balance defaults to "first non-runestone output" or pointer.

Compared to BRC-20

Indexers

• mempool.space — Runes view.
• UniSat — wallet + Runes index.
• OKX — Runes exchange.
• Magic Eden — marketplace.

Reference impl: ord client (also handles Runes since v0.18).

Use cases

• Memecoins (DOG•TO•THE•MOON, RSIC•GENESIS•RUNE, etc.).
• Loyalty tokens.
• Limited issuance assets.

Activation impact

April 2024 halving: Runes activated → massive fee spike (Block 840,000 had record mempool congestion). Subsequent weeks of high fees as etching frenzy continued.

Trade-offs vs BRC-20

Runes are:

• More efficient (smaller footprint).
• Native (validation rules are part of protocol, not indexer).
• Newer (less ecosystem maturity at launch but fast-growing).

Common bugs

• Forgetting pointer field → defaults can send tokens to wrong output.
• Encoding errors in varint payload → tx is silently a no-op for Runes.
• Mint outside cap/time → indexer marks invalid.

See also

• brc-20/SKILL.md
• atomicals/SKILL.md
• ordinals/SKILL.md
• inscriptions/SKILL.md