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Investment firm Franklin Templeton Digital Assets has released a new report stating that the launch of Runes will help Bitcoin “close the gap” with Ethereum and Solana in the fungible digital asset space. The firm believes that with the introduction of the more efficient token standard, Bitcoin is well-positioned to increase its market cap in comparison to other blockchains.

According to the report, Franklin Templeton is bullish on Runes, with a spokesperson from Runestone expressing confidence in the asset. The firm also acknowledged the role of the BRC-20 standard in the proliferation of fungible tokens on Bitcoin but highlighted the issue of UTXO bloat, which can lead to increased fees and network congestion.

The recent downturn in BRC-20 tokens has been attributed to the anticipation of the launch of Runes, with blockchain intelligence company LunarCrush suggesting that investors may be more bullish on the new protocol. Franklin Templeton Digital Assets noted that the Runes protocol will bring several improvements, including no junk UTXOs, increased privacy, and compatibility with the Bitcoin Lightning Network.

In addition to Runes, Franklin Templeton has also been paying attention to other emerging digital assets such as Ordinals, which have been driving innovation and development in the Bitcoin space. The firm predicts that the total number of crypto users will surpass 1.2 billion by 2025.

Overall, the report highlights the positive momentum in Bitcoin innovation and development, driven by NFTs, new token standards, Layer 2 solutions, and DeFi primitives. As the crypto industry continues to evolve, Franklin Templeton remains optimistic about the future of digital assets.

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