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THORChain is the decentralized Liquidity Network. Users deposit native assets into the Liquidity Pools to earn yield. The network is 100% autonomous and decentralized. Liquidity Network is where users will be able to carry out their financial operations without having to transfer ownership of their funds anywhere. Liquidity Protocols work as Automated Market Makers.
In terms of cryptocurrencies, liquidity is the ability of a coin to be easily converted into cash or other coins. Liquidity is important for all tradable assets including cryptocurrencies.
THORChain absorbs the incoming user deposits to vaults, then makes use of the encoded business logic to swap, add/remove liquidity, and eventually processes outbound transactions. THORChain is basically a leaderless vault manager, and therefore ensures that every stage of the process is byzantine-fault-tolerant.
For those who do not know, Byzantine fault is defined as an arbitrary fault that occurs during the execution of an algorithm by a distributed system. When a Byzantine failure occurs, the system may respond in any arbitrary way unless it is designed to have Byzantine fault tolerance.
When a decentralized network is Byzantine fault tolerant, it means that the honest members, or nodes, of a network can be guaranteed to agree on the timing and order (consensus) of a set of transactions.
Thorchain is a Proof-of-Stake (PoS) blockchain secured and maintained by node operators who bond and earn RUNE. Nodes validate swaps and create pools for assets and in return validators will be able to earn Rune. When nodes “validate swaps” “Pools will be created for assets” and in return users will gain rewards.
THORChain (ERC20), can only be purchased with another cryptocurrency on decentralized exchanges. It is a decentralized, anonymous, and oracle-free bridge between blockchains. Thorchain is special because it permits decentralized swaps between supported blockchains. Thus, liquidity providers will be able to earn yield from native assets.
THORChain is not supported by Coinbase. THORChain uses a cross-chain bridge system (known as the THORChain Bifröst) to connect different chains. It also uses an adapted version of Bancor’s “smart tokens” which it calls Continuous Liquidity Pools, to facilitate the exchange of assets.
THORChain permits trustless trading and token swaps for several cryptocurrencies, from bitcoin (BTC) to ether (ETH), via RUNE. Using RUNE as an intermediary allows for the trading of assets from one network to be traded for another in a decentralized manner without using smart contract-based “bridges.”
Buy and Sell Bitcoin (BTC) Without Intermediaries Through ThorChain
