Bitcoin Ecosystem: An Important Force in the New Bull Run

The Bitcoin market is at a critical moment of breaking through the $70,000 barrier. Many investors believe that if Bitcoin can break through and stabilize at this price point, the long-awaited bull run will officially begin.

Driven by such optimistic sentiment, important assets in the Bitcoin ecosystem have risen sharply. BRC-20 tokens $ORDI and $SATS have increased by 25% and 15% respectively over the past week.

The rune market is particularly lively. The rune GIZMO•IMAGINARY•KITTEN, based on the newly released cat figure "Gizmo" by an artist, quickly rose in market value to nearly 20 million USD after its minting. Although the artist himself denies any connection to the rune, the market enthusiasm remains unabated.

The success of GIZMO•IMAGINARY•KITTEN has also sparked a craze for two other "Golden Dog" runes. The runes, based on the dogs of a project founder named "Koda" and another project founder's dog "POOKA," both quickly surpassed a market value of 1 million dollars. KODA•FLUFFINGTON reached a peak market value of nearly 4 million dollars, while POOKA•CANNOT•BE•STOPPED peaked at close to 3 million dollars.

Several leading assets in the rune market have also seen significant increases. PUPS•WORLD•PEACE and BILLION•DOLLAR•CAT have risen nearly 9 times since the end of September, while DOG•GO•TO•THE•MOON has doubled in price. Recently, there have been rumors that a certain trading platform is conducting an internal security audit and regulatory compliance assessment on runes, which has led to more speculation about the recent rise in runes.

If a bull run is about to come, what kind of prospects can we see for the Bitcoin ecosystem?

On the Eve of Great Change: Conservative or Open?

The reactivation of OP_CAT on the Bitcoin mainnet is of great significance. For the vision of "implementing smart contracts on the Bitcoin mainnet," the current issue is not whether it can be done, but rather a choice of whether it should be done.

The popularity of the Ordinals protocol last year undoubtedly made an important contribution to the Bitcoin ecosystem moving towards openness, but this only opened a small gap. The consensus of the Ordinals protocol is just a small subset of the Bitcoin consensus, which also leads to the BRC-20, runes, and other FT protocols on Bitcoin having shortcomings in user experience compared to other chains.

Why is it said that the lack of protocol functionality or user experience is a problem of Bitcoin consensus? Because the consensus of Bitcoin has not been further opened, leading to many limitations of the mainnet. Even so, some developers still believe that these new protocols are a disruption to the Bitcoin mainnet and have been resisting these innovations.

If the BIP-347 proposal "OP_CAT in Tapscript" is approved, and the Bitcoin mainnet ultimately completes the soft fork, it will mean a significant change in Bitcoin's consensus, shifting from conservative to open, and the narrative ceiling of Bitcoin will be raised again.

However, whether OP_CAT can be re-enabled in this bull run remains highly uncertain. Currently, there are two main targets attempting to bet on the revival of OP_CAT: Quantum Cats and the CAT20 protocol.

If OP_CAT cannot be re-enabled, then the rune may continue to maintain the most influential FT protocol position in the Bitcoin ecosystem.

The Rune Market Faces More Challenges

A rune only truly becomes an FT after being listed on a centralized exchange. Before that, the nature of the rune is not much different from an NFT, which is reflected in its market value having a large "backlash"—when liquidity is good, the market value will skyrocket quickly; conversely, it will plummet significantly.

The true market value of Rune needs to be verified through liquidity checks on centralized exchanges, which may also be one of the reasons for the slow progress of listing Rune coins on exchanges.

In addition to centralized exchanges, there are also some Rune Swap products on the Bitcoin mainnet. Interestingly, some products, despite having good quality, have failed to attract enough traffic. In the future, it remains to be seen whether other platforms can improve the on-chain liquidity of Runes by leveraging their own traffic and user experience.

In terms of the richness of coins, Runes already has some "Cult coins", but the hot topics are still relatively thin, mainly revolving around a few major NFT projects or simply based on the size of the holder community. This field needs more participants to create a better environment for the formation of content and Cult coins.

In contrast, the prospects for BRC-20 are currently rather bleak, with $ORDI, $SATS, and $PIZZA being almost the entirety of BRC-20.

The NFT blue-chip tier is stabilizing, and there is still room for exploration in narrative uniqueness.

Currently, 5 projects have solidified their blue-chip status. In addition, there is a special project whose inscription number is very high and has a low total supply, but its floor price remains stable above 1 BTC.

In the realm of pure artistic NFTs, art on Bitcoin needs to seek breakthroughs in themes, such as conceptual art that integrates the cultural attributes of Bitcoin itself, or AI art, etc. From this perspective, CENTS may be the most unique art series currently on Bitcoin, distinguished by the fact that "this unique flavor inherent to Bitcoin cannot be replicated on other chains."

The CENTS series creates a unique "value entanglement" by combining physical penny coins with digital assets on Bitcoin. This narrative is difficult to replicate on other chains, as tokens on other chains are hard to associate with real coins or currency.

The DMT concept is also a unique artistic narrative of Bitcoin worth paying attention to. It is based on various data in the Bitcoin blockchain to create specific digital assets. Currently, apart from Natcats, which is a leading project, other DMT concept projects have not yet garnered sufficient market attention.

Conclusion

The reactivation of OP_CAT in this bull run will determine the direction of the Bitcoin ecosystem. Some currently less popular directions, such as the Lightning Network, may gain more attention if OP_CAT fails to make a comeback.

The Bitcoin ecosystem is currently the only area in the cryptocurrency market that can still drive the "technological narrative." This is mainly because Bitcoin is like a computer still using an old processor, which already has enough hardware for updates, and the key lies in whether the managers can reach a consensus. However, reaching consensus is a difficult process that involves not only clashes of ideas but also potential entanglements of real interests.

In any case, the Bitcoin ecosystem will undoubtedly become one of the important narratives of this bull run, and it will be a uniquely special existence compared to other ecosystems.