Chapter 1: Understanding Runes

What Are Runes?

Runes are interchangeable tokens embedded within the Bitcoin blockchain, each unique yet identical within its type, serving multiple purposes. They leverage the Bitcoin network to facilitate various transactions, including the creation and transfer of digital commodities.

The Role of Runestones

Runestones are essential components of the Rune protocol. They encapsulate messages within Bitcoin transaction outputs to perform operations such as etching new runes or transferring existing ones. The structure of a runestone includes a specific script that initiates with an OP_RETURN, followed by OP_13, and a series of data pushes that get decoded into 128-bit integers. Each transaction can include a single runestone, ensuring clarity and precision in operations.