In this educational guide, we’re going to explore the altcoin named THORChain (RUNE). We’ll cover its fundamentals and planned roadmap, so you can use it to make your own price prediction.
RUNE functions as its own independent blockchain and serves as a decentralized exchange (DEX) similar to Uniswap. What makes RUNE unique is that unlike Uniswap or many other DEXs, it allows for the swapping and transfer of native crypto assets, meaning users don’t need to use an Ethereum bridge and wrap assets on the Ethereum network like they would if they were swapping crypto on any other DEX.
RUNE’s protocol also allows users to provide liquidity (lock or deposit tokens into the protocol) and receive rewards with a portion of trading fees. RUNE uses an automated market maker (AMM) model, which is what other DEXs like Uniswap also use. In RUNE’s case, its model allows for independent crypto asset swaps across disparate blockchain networks completely non-custodially.
Non-custodially just means that the RUNE protocol never holds or custodies the user’s funds during the swap or use of the protocol. Unlike when users use a centralized exchange like Binance to trade from one crypto to another—for example when trading ETH to BTC—the user has to give custody access to Binance for the ETH first. Using RUNE, the private keys of the protocol stay with the user so there is less counterparty risk and more security in the hands of the user.
As of the time of writing, RUNE currently ranks in the #48 of top cryptocurrencies by market capitalization, with its market capitalization currently at $3.1 billion USD. Let’s explore the value, implementations, and price of THORChain’s native RUNE token.
What is THORChain and how does it work?
THORChain works to allow users to move between different blockchains and asset pools natively, without the need for bridges or wrapping of assets on different blockchains.
Because THORChain is a decentralized protocol, this allows anyone around the entire world to be able to trade their native crypto assets without any intermediaries taking custody of funds at any point. This also means that users cannot be restricted from trading based on geolocation or have their assets seized by any governing party, since assets are traded in a non-custodial manner.
THORChain is backed by notable names like Delphi Digital, Multicoin Capital, and others. These are all well-known venture capital (VC) firms in the blockchain industry.
What’s more is that THORChain is also planning to open the door to a whole new world of Bitcoin DeFi in the coming months. Currently, THORChain allows users to earn yield on different types of crypto assets, including Bitcoin, by providing liquidity on the platform. THORChain is also planning to allow users in the near future to earn interest in Bitcoin natively on their existing Bitcoin with its coming product called THORFi.
THORChain’s native token is RUNE. THORChain uses some unique technological advances, including Tendermint consensus, which is the same ConsenSys system used by the Cosmos network. This makes THORChain a proof-of-stake blockchain and caps the max number of validations needed for consensus at 100.
Other technological advantages THORChain offers is the use of continuous liquidity pools (CLPs) which incentivize users to provide liquidity in exchange for fees and RUNE rewards. This works to create an ongoing supply of liquidity and creates an on-chain price feed for individual assets.
THORChain also uses the Bifrost Protocol for security and to limit centralization concerns, as well as a sharding mechanism to allow THORChain to scale, called Yggdrasil Protocol. This allows THORchain to apply sharding to cross-chain ecosystems instead of only to a single chain.
RUNE Tokens
The RUNE token is used for providing incentives on the network.
In summary, below are the 3 main use cases of the RUNE token:
- Transaction fees: Transactions on the blockchain are paid for in RUNE tokens for processing of the transaction. The network requires fees for transaction execution, trading, and cross-chain exchanges.
- Staking to create validation and security of the network: the validators participating in the network must stake RUNE to be part of the THORChain Validator Sets. Block rewards for validators are paid out in RUNE.
- Staking: users can stake RUNE in the protocol’s Continuous Liquidity Pools (CLP’s) to earn on liquidity fees.
Token Distribution
RUNE has a total supply of 1,000,000,000 tokens (1 billion), which is a pre-minted, fixed supply. As of the time of writing, there are 330.69M RUNE tokens in the circulating supply (33%) in March 2022.
There was initially an intention to distribute these 1 billion RUNE tokens via token sales, rewards for liquidity provisions, node operators, and direct allocations to early contributors.
In October 2019, THORchain chose to burn all of the “unused reserves” of the original maximum supply. This amounted to 50% of the initial maximum supply. There was an initiative called Project Surtr which involved burning 15 million tokens as well. This supply reduction did not impact the tokens already distributed to pre-sale and IDO investors.
The allocation of the original RUNE supply as well as the post-burn amounts are as follows:
- 500 million RUNE to reward network validators; this became 220 million post-burn
- 130 million (65 million post-burn) to use for staff incentives and other operational uses as a company
- 120 million for community reserves in RUNEVault; this became 60 million post-burn
- 100 million for team and advisors; this became 50 million post-burn
- 60 million for seed investors; this became 30 million post-burn
- 70 million for pre-sale and private sale investors
- 7 million (of the 20 million offered in the sale, 13 million went unsold and were later burned)—this was for IDO
Token sales: THORChain used an IDO model (initial DEX offering) for its initial distribution and the sale ran on Binance DEX. 7 million RUNE out of a proposed 20 million were sold at the IDO at an average price of $0.032. There was also a seed and pre-sale round before the IDO. The seed round involved 60 million RUNE at $0.01 and the pre-sale sold 70 million RUNE at a 30% max discount compared to the IDO price, putting this cost basis at $0.023.
Source: Messari.io
THORChain (RUNE) Price History & Technical Analysis
As of the time of writing, in March 2022, the price of RUNE is at $10.5, with a market capitalization of $3.8 billion USD.
The total value of the THORchain network will function similar to a social network and a liquidity vault, meaning as more people use the network itself and deposit more liquidity into the protocol itself, its market capitalization will continue to increase.
As demand for the usage of the RUNE token goes up, its price will increase in turn, especially due to its fixed supply. The RUNE token also has what is called deterministic value. This means that if over 80% of the circulating RUNE gets locked into THORChain liquidity pools, by economic design, RUNE’s market capitalization should be a minimum of 3X the value of all non-RUNE assets locked into THORChain liquidity pools (BTC, ETH, BNB, BCH, LTC, DOGE). The more RUNE holders that provide liquidity with their RUNE, the more accurate this quality of RUNE becomes. As of right now, 67% of RUNE is locked in THORChain liquidity pools which can be noted here.
While address growth alone does not necessarily translate to the growth of users, it is still a way to gauge growth. Metcalfe’s Law states that the value of a network is directly related to the number of users of that network, so as there are more users of the THORChain network, the more we can expect the value of RUNE to increase over time.
According to thorchain.com, the network currently has over 15,000 monthly users, over $1.1 billion USD in the reserves, and over $1.3 billion value locked. In summary, RUNE is an appreciating asset since it is required to be paired as a settlement asset 1:1 in pools which causes the value of RUNE to increase with more liquidity in its pools, it provides high yields for liquidity and node providers, and even protects these liquidity providers against impermanent loss.
What Expert Analysts say about THORChain:
- CRYPTOPOLITAN says, "THORChain has a promising future. With the continuing advancements in the RUNE community and the broader cryptocurrency market, we may see RUNE continue to flourish and break new ATH. The bullish RUNE price forecast system for 2021 is predicted to hit a maximum price of $19.4. As previously said, it might potentially hit a new all-time high if investors believe that RUNE, along with popular coins, is a suitable investment in 2021."
- Changelly Blog says, "At the end of July, out of 100 leading cryptocurrencies in terms of capitalization, THORChain showed the highest 18% growth. The project team has its roadmap in which they claim that the Mainnet is not far away. It seems like the asset can show us real growth."
- Wallet Investor, however, is more long-term according to their RUNE price prediction, “As per wallet investor predictions, RUNE is forecasted to hit a maximum price of $18.032, minimum it would flip to $12.651. The token is expected to trade at an average price of $15.201. Walletinvestor anticipates THORChain to trade at an average price of $40.241. And maximum price expected is $49.767, minimum it would plunge back to $30.863 by 2025.”
- Coinpedia says, "With the introduction of new technologies, RUNE’s price is expected to reach new highs. An increase in FOMO equals to increase in surge levels. According to Coinpedia’s formulated THORChain Price Prediction, if the above scenario arises, then RUNE might hit maximums and new ATH at $18.226 by the year-end…"
THORChain Partnerships
ThorWallet is a wallet application for the THORChain community.
DeFiSpot is a decentralized multi asset exchange that has also partnered with THORChain. Other exchanges include THORSwap and Brokkr. THORYield allows users to visualize liquidity positions, rewards, and total percent gain versus just holding the tokens.
THORChain Price Prediction: 2022-2026
RUNE’s price remained under $2 during its initial launch and for much of 2020, before first seeing tremendous growth during spring 2021, eventually reaching a peak of about $22. Since this peak, RUNE has traded in a macro wedging structure, setting a low of around $2 during the summer of 2021 alongside a hack of the protocol, and most recently as of the time of this writing, crossing $10 again, now facing resistance.
Despite the overall bearish price pressure in the crypto markets in spring 2022, seeing RUNE being this strong is a great sign, especially with its protocol continuing to implement improvements.
If the market structure remains unchanged for RUNE, we might see it go beyond $20 eventually later this year or in 2023.
THORChain Price Prediction 2022
With the price continuing to hold well above summer 2021’s lows, and Rune’s continued development and rapidly increasing liquidity which helps its deterministic value of the RUNE token, the growth of the network seems very promising.
This makes some analysts predict that THORChain will see above its previous all-time high of $20.35 during 2022.
THORChain Price Prediction 2023
With the growing necessity for decentralized cross-chain asset swaps done in a permissionless and non-custodial manner, and the coming implementation of THORFi (DeFi on RUNE), we expect to see continued growth of the network. This can bring RUNE to a market capitalization of around $10 billion USD or more, putting its price around $30 or more.
THORChain Price Prediction 2024
The THORChain roadmap provides us a glimpse of planned improvements to the protocol, and the growing market capitalization looks promising. It would not be unreasonable to see RUNE reach a $15-20B market capitalization during or before 2024, which is more than a 5X increase from its current $3B market capitalization.
Provided the overall crypto market remains bullish and we can avoid an economic downturn and bear market overall, this could mean we have the potential to see RUNE at $50-60 during 2024.
THORChain Price Prediction 2025
2025 is still far away at the time of this writing. The continued developmental challenges in blockchain and decentralized exchanges, as well as custodial solutions, are uncertain to extrapolate that far out. However, RUNE has proven to be a strong contender thus far. If all goes well, RUNE could reach $80 by 2025.
THORChain Price Prediction 2026
The crypto market overall could very well be worth $10T in total market capitalization by 2026. Depending on regulations and the overall economic cycles of the economy, we may see RUNE as high as $100 by 2026.
None of these predictions are financial advice, and are educated guesses as to where RUNE’s price may be at each time interval. It should be noted that any major financial hack or error could change these predictions, though RUNE has already survived two hacks of more than $10 million during 2021, which means it has already proven to be very resilient.
However, it should be noted that anything could still happen. Another hack of a much higher amount could happen and an economic downturn could even take the entire crypto market with it. While these are unlikely compared to an overall economic downturn or contraction, they are all possibilities that can affect the price.
THORChain (RUNE): Conclusion Price Prediction
On one hand, THORChain is a top contender long-term that anyone can retain in his or her wallet for the long haul and not worry about day-to-day price fluctuations.
THORChain has ambitious growth plans, is innovating in the realm of liquidity provisioning and DeFi, and continues to increase its security and non-custodial DEX solution.
Many investors are hesitant to commit their money into an asset for an extended period of time due to the volatility of the cryptocurrency markets. Given THORChain’s benefits of high yield, continuous liquidity pools, Tendermint consensus which makes it achieve fast throughput better than Bitcoin or Ethereum, its verifiable solvency, and other benefits, RUNE remains a sound investment in its sector.
FAQs
How is THORChain gaining traction?
Many people are interested in THORChain’s price and potential because of its significant technological advantages of solving the cross-chain asset swapping problem in a non-custodial manner.
Investors trust this cryptocurrency and see the value of RUNE. Any cryptocurrency would lose value if no one bought it, and people continued to sell. Because the overall market believes in the technology THORChain offers, the price continues to hold and increase. Moreover, because the liquidity inside of RUNE’s pools continue to increase at a rapid rate, the value of the RUNE token continues to increase in turn.
Where can I buy THORChain?
RUNE, the token, can be bought and traded on all major centralized platforms and exchanges such as Binance, KuCoin, and Voyager, and others for all major fiat currencies such as USD, GBP, and EUR, or even for crypto pairs such as trading BTC or ETH for RUNE.
In comparison to other cryptocurrencies, how can THORChain secure privacy?
THORChain is a native public blockchain, meaning all transaction data is publicly available on the network for any party to see. However, the protocol is permissionless, meaning since users store their own assets in custody while using it, any party’s approval is not needed to use it. THORChain has made comments regarding supporting privacy coins in the past, including XMR, ZEC, and DASH.
Is it possible to stake THORChain?
Yes, RUNE tokens can be staked by node operators to earn RUNE staking rewards. Users can also delegate their RUNE to the liquidity pool and/or to node operators for staking.
Why is THORChain on the rise?
RUNE is on the rise because of its use case as a native blockchain network, but also its primary use case as a non-custodial native asset swapping DEX and its increasing liquidity pools which work hand in hand to provide deterministic value to the RUNE token.
Is THORChain completely anonymous?
No, all public ledgers are completely visible for all transaction data to all parties on the blockchain. THORChain is a public blockchain, so any party can see all transactions, though it may be pseudonymous, meaning the user’s name is not necessarily linked to the transactions or wallet addresses.
However, depending on where the user sources his or her RUNE and other tokens that are deposited in its liquidity and funded with fiat currency, blockchain forensics can easily identify the user’s identity.
Is RUNE considered a currency?
Yes. RUNE functions as a currency for use and payment for transactions on the THORChain network.
Is it possible to generate profits with THORChain?
Yes, it may be. RUNE is expected to grow over the years and months to come. However, all investors must do their own research, due diligence, and ensure that they are comfortable with the amount of risk they are taking. All cryptocurrencies are extremely volatile and risky. Always proceed with caution.
Why do people believe in THORChain?
Analysts believe that RUNE is one of the most advanced cross-chain asset swapping protocols out there and continues to innovate on other features such as lending, composite assets, synthetic assets, and even leveraged trading.
Is THORChain supply limited?
Yes, RUNE has a fixed supply of 1 billion RUNE tokens. As such, if the demand for RUNE goes up, so will its price.
How does the THORChain team investigate suspicious or fraudulent transactions?
It is not publicly noted how the THORChain team investigates suspicious activity or transactions, but advanced blockchain forensics companies such as Chainalysis and Elliptic work with the private sector and government actors to investigate illegal activity.
DISCLAIMER
This is not financial advice, only observations and speculation. All investors should do their own research and due diligence. The crypto markets are extremely volatile and losing your investment is possible.
