Thorchain (RUNE) and the Resumption of the Uptrend Due to Multiple Factors

• Thorchain (RUNE) on Cosmos SDK
• Rune Mainnet Launch
• 5 million Permissionless swaps
• Terra (LUNA) integrated to THORchain Protocol
• AMM model makes it Unique
• Only Native Asset Swapping
• Synthetic assets
• Low collateralization
• Cheaper swap fees

Thorchain is an independent blockchain which has been developed by making use of the Cosmos SDK. RUNE has a forth coming mainnet launch, which has in turn improved expectations around the token. Further, Thorchain network has achieved 1.5 million decentralized permissionless swaps.

Terra (LUNA) has been integrated to the THORchain Protocol. The project also makes use of the AMM model and RUNE is the base pair.  Further, the non-custodial THORChain only permits users to swap native assets across chains.

The protocol permits users to exchange their cryptocurrency assets across various networks without losing their full custody of the assets.

For instance, users will be able to swap their Bitcoin – BTC for Ether – ETH on the THORChain without using a centralized exchange.

Based on the proof-of-stake consensus mechanism, the tokenomics is such that the value of the RUNE token increases in value with the growth in the utilization of its network. The more the liquidity that goes into the Thorchain Liquidity Pools, the more valuable will RUNE become.

The decentralized liquidity protocol, has been gaining traction for over a period of time. More of cryptocurrencies are coming to the platform like Terra (LUNA).  Noteworthy, Thorchain gained 150% in just one month.

The catalyst behind RUNE’s rally is closely related to the cross-chain liquidity protocol’s launch of synthetic assets and also the positive sentiment of investors towards Cosmos-based projects.

A THORChain synthetic assets are unique as it is backed by 50% of the underlying asset and 50% of RUNE as opposed to be backed by 100% of the actual asset. Synthetic assets are derived tokens which replicate the value of another asset. They track real world assets like stocks, commodities or even cryptocurrencies.  Traders use these assets for different reasons like taking advantage of lower fees, performing quick transactions and being able to have access to 24/7 trading.

THORChain permits users to mint synthetic versions of different cryptocurrencies.  To mint synthetic assets users add either RUNE or the actual crypto asset to a THORChain liquidity pool. The collateralization ratio is very low due to the 50:50 factor. Also, the protocol structure of THORchain does away with impermanent loss. The reserve pool of RUNE tokens makes it possible to pay for the block rewards of node operators and liquidity providers.  Also, Liquidity providers enjoy linear impermanent loss protection for 100 days.

Also, THORChain synths are cheap to exchange when compared to layer-1 assets as there is a 50% reduction in swap fees when swapping “asset to synth”, “synth to asset”, or “synth to synth”.

Reportedly, the full suite of products on the ThorChain can be accessed from the interface provided by Defispot, a decentralized multichain exchange, thus improving adoption.