Miners strike it rich

This past weekend's launch of Runes, a protocol for minting tokens on top of the Bitcoin network, sent transaction fees through the roof, at least momentarily producing a bonanza for miners.

Yesterday, shares of U.S. mining stocks (MARA, RIOT and CLSK, to name three big ones) experienced an impressive spike, this despite the halving of miner rewards from 6.25 BTC to 3.125 BTC. Some of the most potent players in the space are seen as poised for growth in an environment that longer-term likely will bring consolidation.

That’s a forecast born from conventional wisdom about mining profitability. But Runes could be upending the equation.

Out of the gate, Runes juiced miners' revenue in record-setting fashion as fees on Saturday surged from an average of $18 to an average of $128, per data from IntoTheBlock. Average fees eventually fell back to about $34, as Forkast noted.

Runes-related demand for block space resulted in some monumental halving-event-timed action – just that first post-halving block alone amassed $2.6 million in fees and rewards.

With BTC’s spot price rising and miners taking a victory lap, the Valkyrie Bitcoin Miners ETF (WGMI) on Monday posted an 11% gain. The rise was recorded during regular trading hours. WGMI gained another 3% in after hours, nearly reaching $17. WGMI was $16.20 in pre-market trading today as of 8 a.m. (EST).

BTC itself has gained about 4% since the halving this past Friday night. BTC remains flat over the past 24 hours, sitting right around $66K.

One mining stock in particular ruled the roost yesterday: Stronghold Digital Mining. SDIG surged 35.32% to reach $3.64 at the close.

Among Top 100 coins, there is one enormously outsized performer, Akash Network (AKT), which soared 54% in 24 hours after securing a key listing on a big centralized exchange.

Locked SAFE tokens started trading. Slowly but surely, yesterday, a stash of previously off-limits SAFE tokens winnowed their way to exchanges. SAFE hit almost $2.8 billion in terms of its fully diluted value. SAFE's max supply is 1 billion. The circulating supply is 427 million.

SAFE is the governance token of Safe Protocol, a decentralized finance (DeFi) custodian.

Fittingly, these tokens have been locked away for two years. According to The Block, SafeDAO, the decentralized autonomous organization (DAO) that runs the protocol, had formally decided as part of an airdrop in 2022 that the tokens would not be transferable until certain milestones were met.

"The decision to make SAFE tokens transferable, along with the process of reaching this point, was guided by SafeDAO governance," a Safe spokesperson recently told The Block.

SafeDAO over the past year is described as having reached an alignment regarding observable progress relating to these milestones. The official X account of Safe Governance today posted that "the Safe token contract is officially unpaused and SAFE is transferable."

In the wee hours of Tuesday, SAFE rose to a high of $3.56.  But it has since retreated, as unlocks often produce sell pressure.

SAFE in roughly the past six hours has plunged 24%.

Runes-spawned demand for space on the Bitcoin network is creating a fresh batch of excitement in the crypto world.

And now, already, a Cayman Islands-based exchange, Gate.io, has listed a trio of Runes-minted coins, all of them with funky naming conventions native to the Runes realm. For example, we've got WANKO•MANKO•RUNES. And there's SATOSHI•NAKAMOTO.

According to Decrypt, centralized exchange OKX is dabbling in Runes tokens via its Web3 marketplace for peer-to-peer trading. Although to be clear, OKX's main exchange platform has not yet listed any Runes tokens.

"There was a mad rush to launch Runes tokens on Friday when the protocol went live," Decrypt said.

One of the more curious Runes-spawned coins is UNCOMMON•GOODS, a pet project of Runes creator Casey Rodarmor and which boasts of having an endless supply in what could be seen as a brazen thumb in the eye of economic traditions or simply a marketing gimmick.

Runes is touted as a more efficient, more broadly alluring way to implement tokenization functionality on the Bitcoin network relative to the experimental BRC-20 standard for non-fungible tokens that gained traction over the past year. Time will tell whether the biggest centralized exchanges embrace Runes-spawned fungible tokens.

Last year, Gate.io, which takes pride in pioneering new assets, was the first to list ORDI, the first BRC-20 token in the space.

Binance, OKX, and other CEXs eventually would come to list ORDI, which now has a market capitalization of $1 billion.

"Centralized exchanges have a way of helping to legitimize assets, elevating them and potentially putting them in front of many more eyes," Decrypt said.