THORChain data analysis: swaps, liquidity, synths and RUNE deterministic price
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Data review of THORChain after a 172% monthly rally: swap volume, liquidity and active address growth, synths, savers vaults and lending, plus RUNE's deterministic value from the 2:1 bond:pool ratio versus market price.
Key claims
RUNE up 172% in one month
Pool liquidity rose from under USD 120M to over USD 314M YTD
Deterministic RUNE price USD 1.63 vs market USD 5.87
Thorchain pumped 172% in just one month! 🚀
Is this just the beginning of @THORChain season? How can you position yourself? ⚡️
A data-driven analysis (and a low cap ecosystem gem) 📊 👇
1/ ⚡️ What is Thorchain? ⚡️
@THORChain is a cross-chain, decentralized liquidity protocol that facilitates native asset settlement across 9 different L1 blockchains.
THORChain is built on the Tendermint consensus engine and utilizes the Cosmos-SDK state machine.
2/ These technologies, combined with the GG20 Threshold Signature Scheme (TSS), ensure the security, scalability, and interoperability of the protocol. With its unique architecture.
@THORChain operates as a L1 cross-chain DEX, providing fast & secure trading of digital assets.
3/ ⚡️ Why does Thorchain matter? ⚡️
@THORChain allows for non-custodial cross-chain swaps of native assets without wrapped or pegged assets and without the need for a CEX!
Users don’t need RUNE to pay for transactions. The only requirement is a transaction on the first chain.
4/ This removes the bridge risk associated with wrapped assets and makes secure native cross-chain swaps accessible without the need to care about RUNE gas.
5/ ⚡️ Data Analysis ⚡️
But let's have a look at how @THORChain has been doing in terms of numbers
6/ The price has been skyrocketing with an increase of 172% over the course of just one month! 🚀
7/ Is that appreciation driven by fundamentals?
Looking at the swap volume, we can confirm that YTD, there has been significant growth. 📈
8/ We see a similar picture when we look at liquidity in @THORChain pools, which has increased from below USD 120M to over USD 314M YTD! 📈
9/ Bitcoin is king, but there is also significant amounts of $ETH, $USDT and $USDC on @THORChain.
10/ What is really interesting, is that by providing liquidity (of native assets) in @THORChain's pools, you can earn really high APRs
>86% APR on native BTC-RUNE with impermanent loss protection sounds like a pretty juicy opportunity tbh.
11/ So no wonder the number of active addresses on @THORChain has been up only since the beginning of the year. 📈
12/ In a similar pattern, we see a significant growth in terms of the number of swaps that are conducted through @THORChain on a daily basis. 📈
13/ And it's not just the same few degens swapping all the time, numbers are also going up for the number of unique swappers! 📈
14/ What has definitely contributed to @THORChain's success recently as well, is the growing suite of natively integrated DeFi products.
One example are Synths.
15/ Synthetic Assets (“Synths”) are a collateralized representation of an asset on @THORChain.
These derivatives of cryptocurrencies such as Bitcoin, Ethereum, etc will always have the same value as the original asset.
16/ Unlike Wrapped Assets, @THORChain Synths are backed by THORChain Liquidity Pools, which contain 50% of the original asset and 50% $RUNE.
THORChain Liquidity Pools ensure that the synth price always remains 1:1 with the native token price.
17/ Collateralization via pool ownership ensures always-on liquidity and pricing. In short, there is always a direct correlation between the Synth and the Assets which are being secured.
18/ Synths can be used for cheap & fast trading and arbitrage opportunities (you only interact with @THORChain, so no need to worry about different chains, gas prices, wallets).
19/ Synths volume has been going through the roof recently!
20/ Savers Vaults on the other hand are the simplest way to provide liquidity to @THORChain.
Users can deposit any major Layer 1 asset and earn without RUNE price exposure.
Withdraw to native assets at any time.
21/ The most recent feature addition was borrowing/lending.
Borrow against your native assets like BTC or ETH and receive a USD denominated debt without interest, expiration, or risk of liquidation.
22/ Another cool feature that might have contributed to the strong growth of transaction count and volume are streaming swaps.
23/ But let's get back to RUNE, the native asset.
There is one key concept you have to understand.
RUNE's deterministic price.
24/ RUNE's price has two factors: a deterministic value based on the liquidity within the network, and a speculative premium.
25/ Its 2:1 bond:pool ratio, combined with the 1:1 RUNE-Asset pairs in the liquidity pools means that the value of RUNE needed in the network is three times the value of the non-RUNE assets locked.
26/ If $1,000,000 worth of non-RUNE tokens are deposited in @THORChain, the market cap of RUNE will be at least $3,000,000. This is just the minimum, or deterministic value, of RUNE.
27/ Currently it stands as follows:
📊 Deterministic price: USD 1.63
📊 Market price: USD 5.87
28/ ⚡️ My low-cap Ecosystem Play ⚡️
Before I introduce my Thorchain ecosystem play, it's important to understand the concept of affiliate fees.
Thorchain is only a technology base layer for cross-chain swaps. Users interact with Thorchain through interfaces.
29/ These interfaces are DEXes or wallets that can charge fees, a.k.a. affiliate fees.
These affiliate fees are meant to incentivize builders to build on top of @THORChain's technology.
30/ A wallet developer simply adds their affiliate address, as well as fee rate, to the tx before the user signs it.
The user can review it, as well as see the fee rate to be taken.
When @THORChain sees the tx it will skim off the fee & pay it directly to the affiliate.
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