Comparison of ERC20 and Runes Protocol: Analysis of the Potential of Emerging Coin Issuance Standards

In the cryptocurrency field, Ethereum's ERC20 protocol has long been the dominant token issuance standard. It not only promotes the development of the Ethereum public chain, making it the most mainstream smart contract platform in the crypto world, but also fosters the prosperity of decentralized finance (DeFi) and provides new possibilities for project financing and entrepreneurship.

However, with the continuous advancement of blockchain technology, new public chains and protocols are emerging, attempting to replicate and surpass the success of Ethereum. In this context, an emerging protocol—Runes—is gradually attracting attention in the industry.

The Runes protocol is built on the Bitcoin network, combining the advantages of BRC20 and ERC20 while introducing new features. Compared to ERC20, Runes has the following advantages:

1. A more solid foundation: Runes is based on the Bitcoin network, and Bitcoin accounts for about 50% of the market capitalization in the entire cryptocurrency market, which provides Runes with a very solid foundation.

2. Flexibility: Runes supports various token issuance models, allowing for both fair launches and reserving a portion of tokens for project teams for financing.

3. Efficiency Improvement: Compared to BRC20, Runes make transfer operations more convenient, eliminating the need for additional engraving transactions, which can reduce network burden and user costs.

4. Concurrency: Runes allows sending tokens to multiple addresses simultaneously in a single transaction, improving distribution efficiency.

5. Innovation: As a newer protocol, Runes has a high level of discussion and growth potential in the cryptocurrency market.

6. Compatibility: Runes can integrate with Bitcoin's second layer network to achieve more complex business application logic.

Nevertheless, ERC20 still has a first-mover advantage and a mature ecosystem. For Runes to establish a foothold in the market, it will still take time to build its own ecosystem and application scenarios.

The design details of the Runes protocol include core functions such as token deployment, minting, and transfer. It carries token information through the OP_RETURN opcode in Bitcoin transactions, enabling the issuance and management of tokens on the Bitcoin mainnet.

Overall, the Runes protocol demonstrates the potential to become the next generation mainstream issue coin standard. It combines the stability of Bitcoin with the innovation of emerging protocols, providing new possibilities for the issuance and management of digital assets. With more projects and developers joining, Runes is expected to play an important role in the future cryptocurrency ecosystem.