THORChain Finance
THORChain Finance - A comprehensive overview of financial primitives and mechanisms within the THORChain ecosystem
THORChain Finance encompasses the core financial primitives that enable cross-chain liquidity and trading on the THORChain network. These mechanisms provide the foundation for decentralized finance (DeFi) operations while maintaining security and efficiency across multiple blockchain networks.
Core Financial Primitives
The foundation of THORChain's AMM (Automated Market Maker) system, enabling permissionless liquidity provision and efficient asset swapping across chains without wrapped tokens.
A capital-efficient alternative to synthetic assets, offering 2x the efficiency for arbitrageurs with 6-second finality and no slippage redemption.
THORChain's approach to maintaining asset security through distributed key management and threshold signature schemes (TSS).
THORChain's native algorithmic stablecoin, designed to maintain price stability while integrating with the broader THORChain ecosystem.
Pooled liquidity provision mechanism that allows smaller RUNE holders to participate in liquidity provision with lower barriers to entry.
Economic Model
THORChain's financial architecture is built around the Incentive Pendulum, which maintains a 2:1 bond-to-stake ratio ensuring network security. The native RUNE token serves four critical roles:
Settlement Asset: All cross-chain swaps settle in RUNE
Security: Node operators bond RUNE to participate in consensus
Liquidity: Liquidity providers pair RUNE with external assets
Governance: RUNE holders participate in network governance decisions
Key Features
Cross-Chain Native: Direct swaps between native assets across different blockchains
Permissionless: No centralized authority controls access or operations
Capital Efficient: Advanced mechanisms like Trade Assets maximize capital utilization
Secure: Distributed key management protects user funds across all supported chains
Transparent: All operations are verifiable on-chain
Getting Started
Choose the primitive that best fits your needs:
New to DeFi: Start with Continuous Liquidity Pools
Active Trader: Explore Trade Assets for efficient arbitrage
Stability Seeker: Learn about TOR stablecoin
RUNE Holder: Consider RUNEPool for passive liquidity provision
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