coindesk.com
Bitcoin’s halving event could increase bets on related networks and ecosystem tokens, with traders expecting tokens such as STX, RUNE, and ORDI to rise.
Bitcoin-based meme coins, NFTs, and Ordinals could form part of a “barbell strategy” comprised of both technical and non-serious projects, some traders say.
Bitcoin’s (BTC) much anticipated halving event later this month could see a flurry of bets on related networks and ecosystem tokens, with traders expecting upside on both technical and meme coin projects.
Halving reduces the rate at which new coins are created and lowers the available new supply. The current block reward is 6.25 BTC, and it will drop to 3.125 BTC after the halving. This event has historically preceded a bull market for the token.
Crypto traders say participants seek a “reason to buy” as money narratives continuously shift in the current bullish environment and they may turn their focus on the bitcoin ecosystem in the coming weeks.
“There exists a large, untapped pool of capital within the Bitcoin ecosystem that remains dormant, and surprisingly few listed assets that traders can use to gain exposure to the narrative,” the OTC desk of trading firm Wintermute told CoinDesk over email.
“Should capital begin to rotate into the Bitcoin ecosystem, tokens like $RUNE, $STX, and $ORDI could benefit significantly and outperform,” they added.
THORChain’s RUNE and Stack’s STX have been among the top-performing tokens in the past year, CoinGecko data shows, tracking a bitcoin rise. Meme coin ordi (ORDI) – a nod to the Ordinals protocol on Bitcoin – has surged over 2,500% since its September issuance.
Meanwhile, Bartosz Lipinski is the founder of the crypto trading platform Cube.Exchange said in an email that meme coins and the upcoming Runes protocol could rile up risky bets in the bitcoin ecosystem.
“Ethereum’s high costs and significant network congestion will cause it to take a backseat as Bitcoin-based projects, like Rune, will redirect meme coin hype to the Bitcoin ecosystem because of the novelty,” Lipinski said. “The BRC-20 (Ordinals NFT) standard is likely to be overtaken by Runes, which is expected to launch on the day of the halving.”
“Runes will aim to replace the standard with fungible tokens, which will enable the efficient creation of meme coins to compete with projects on Base and Solana,” he added, referring to the ongoing frenzy for non-serious tokens in the two ecosystems.
Ordinals are a way to embed data into the Bitcoin blockchain by inscribing references to digital art into small Bitcoin-based transactions.
Ordinal volumes were higher than those of usual leaders Ethereum and Solana in the past week, as reported, led by NodeMonkes and Pups. Non-fungible token (NFT) on other networks buying and selling activity declined 95% across all networks in the same period, suggestive of an isolated interest in Ordinals.