THORChain (RUNE) has made a comeback, participating in the bullish trend to reach a new record high above $10 on March 11, 2024. This significant achievement comes after a nearly two-year period. The value of RUNE has seen a remarkable increase of 744% year-to-date and 113.9% over the last week. The daily trading volume has been growing steadily at an average rate of 25%, exceeding $100,000. Additionally, the market capitalization of this altcoin has also risen by more than 96.25% in the previous week. Let’s explore the reasons behind the remarkable surge in THORChain price.

Understanding THORChain (RUNE)

THORChain is a decentralized liquidity protocol that enables users to effortlessly exchange cryptocurrency assets across various networks, such as Bitcoin and Ethereum, while retaining complete control over their assets.

Users can easily swap one asset for another in a permissionless environment, eliminating the need for order books to access liquidity. Instead, market prices are maintained through the ratio of assets in a pool, which is facilitated by an automated market maker.

The primary utility token of the THORChain platform is RUNE. This token serves as the native currency within the THORChain ecosystem and also plays a crucial role in the platform governance and security. As part of THORChain’s Sybil resistance mechanisms, nodes are required to commit a minimum of 300k RUNE to participate in the rotating consensus process.

Market Performance of THORChain Price

THORChain price today is $11.19 an increase of 15% over the past day. RUNE experienced an increase in trading volume by 47.86% to reach $1.267 million, demonstrating heightened trading activity over the last 12 hours. With a circulating supply of 338,316,645 RUNE coins, and a market cap of $3.8 billion, the ThorChain token is ranked 39th on CoinMarketCap. 

That’s not all. RUNE has maintained steady growth over the past month by 110% and rapidly increased its price by 115%.

The Reason Behind THORChain Price Rising

Thorchain’s recent price surge can be traced back to a significant decision by the network: burning a hefty amount of RUNE tokens. Specifically, 60 million RUNE from the Standby Reserve were disposed of, making room for an expansion in lending capabilities. This move reduced the token’s overall supply by 12%, even though the Standby Reserve tokens weren’t actively circulating.

But why burn the Standby Reserve? Thorchain wanted to enhance its lending protocol by accommodating more BTC and ETH collateral. By eliminating idle funds from the Standby Reserve, the network freed up resources for more dynamic use, aligning with its vision for growth and innovation.

This action also ties into the concept of the lending lever, which determines how much collateral can be included. With the burn, Thorchain not only increased this capacity but also strengthened its defenses against inflationary pressures. This strategic move signals Thorchain’s commitment to improving its protocols for long-term success.

60m $RUNE was burned from the Standby Reserve, creating 20m RUNE ($140m) in space for lending collateral.

There is now room for ~2000 #Bitcoin or 36k ETH in THORChain lending. No liquidations, no interest.

Details on Medium: https://t.co/yLCdz13oyL pic.twitter.com/aNePxXpvLV

— THORChain (@THORChain) March 8, 2024

As THORChain prepares for its network upgrade, the DeFi community is eagerly observing. The decision to burn 60 million RUNE tokens and adjust the maximum collateral ratio is anticipated to have significant implications, not just for THORChain but for the wider DeFi ecosystem. These steps highlight THORChain’s forward-thinking strategy and its commitment to evolving in line with market dynamics and user needs.

Looking ahead, THORChain’s strategic initiatives aim to strengthen its position as a leading decentralized cross-chain trading protocol. By improving the efficiency and security of its lending operations, THORChain aims to pave the way for broader adoption, to attract more users, enhance liquidity, and promote active trading across its platform. These changes are expected to contribute to the overall growth and development of the DeFi sector, fostering innovation, security, and user satisfaction.

As investors recognize these developments, the resulting excitement has propelled Thorchain’s price upward, reflecting confidence in the network’s strategic direction.

Conclusion

As THORChain continues to evolve and strengthen its position as a leading decentralized cross-chain trading protocol, investors are optimistic about its future prospects, driving the token’s price upward and reflecting confidence in the network’s strategic direction.

The post THORChain Price: Why is RUNE Price Rallying? appeared first on CoinGape.

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Filed under: News - @ January 1, 1970 12:00 am