THORChain Activates Feature, 30% Spike Follows, Can Bulls Sustain It?

March 9, 2022

Up almost 30% during today’s trading session, decentralized cross-chain exchange THORChain (RUNE) trades north of $5.28. The network activated synthetic assets today, which is a feature that can attract users and use cases to it. It was one of the biggest gainers during the relief rally.

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RUNE THORChain RUNEUSDT
On the 4-hour chart, RUNE moved sideways. Source: RUNEUSDT Tradeview

Officially, synthetic assets refer to tokens that are tied to the value their underlying collateral like Bitcoin or Ethereum. In other words, you can access BTC, ETH and all the others on THORChain.

Wrapped Bitcoin is similar to wBTC (wBTC). However synthetic assets and digital currencies can be used as collateral in the case of sBTC. The synthetic version of Bitcoin running on this blockchain is called sBTC and offers the user exposure to BTC’s price performance.

According to this post, the synthetic Bitcoin version of THORChain is faster than Bitcoin and charges lower fees. This allows users to trade using this benefit, and also benefit from yield-generation products. This is what the post says:

Your funds will also be vestable as you have the ability to gain access to yield-generating vaults. The access to minting synths and THORChain liquidity will limit their availability.

This post explains that traders can use multiple blockchains to access different cryptocurrency without having to go through a central exchange. Core developer Chad Barraford said the following on the advantages of this feature and its impact on the network’s ecosystem:

The pool’s depth can be adjusted using synthetics. This will correct the price of the pool to meet market demand. arbitrage. This is a huge advantage because the pool can be arbs quicker, cheaper and more efficiently.

THORChain Releases Roadmap: How it Is Working Towards decentralization

THORChain users will also be able to make up to 20% on synthetic assets. To do this, you will need to put your assets into a vault called THORSaving. This vault will earn an initial 5% APY.

The most popular product in lending and borrowing. Users will be able to access “self-repaying loans” which generate yield on collateral. This was clarified in the article:

The loan is taken and paid back by the interest generated from locked synthetics.

Barraford expects a rise in the trading volume of RUNE and other ecosystems. The project recently integrates with Terra (LUNA) and will begin acquiring this network’s native token along with its native stablecoin UST.

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The ultimate goal of the decentralized currency is to improve its liquidity 10 fold. THORChain has published a roadmap for achieving this goal. This includes the integration and use of DEX aggregators as well other features, wallets and access to additional blockchains.

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