Digital assets on decentralised blockchains allow new forms of trustless peer-to-peer money and are a promising future of finance.
However, centralized exchanges are currently the only way to exchange these assets - a significant weakness of the entire ecosystem. /1
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However, centralized exchanges are currently the only way to exchange these assets - a significant weakness of the entire ecosystem. /1
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From countless exchange hacks, founder exit scams and loss of user-privacy, as well as poor liquidity, manipulated volume and prices, it is time to re-think the digital asset exchange. /2
What is desired is a distributed and secure system that prevents any centralised points of failure, ensures economic security of assets, incentivises deep liquidity and prevents fake volume or manipulated prices. /2
If this can be solved, then billions in daily volume from millions of users can be secured trustlessly.
THORChain is a solution. /3
THORChain is a solution. /3
It’s a decentralized liquidity network, where assets are pooled into liquidity pools, secured by a network of nodes.
Instead of depositing on an exchange, users simply make on-chain transactions into these pools and have their swap request fulfilled immediately. /4
Instead of depositing on an exchange, users simply make on-chain transactions into these pools and have their swap request fulfilled immediately. /4
Nodes bond large amounts of capital, which underwrites the pooled assets.
They are paid to secure the network, which means they can fund very safe infrastructure.
Nodes have to all work together to fulfil swap requests, which means none of them can ever steal assets. /5
They are paid to secure the network, which means they can fund very safe infrastructure.
Nodes have to all work together to fulfil swap requests, which means none of them can ever steal assets. /5
The system can work with multiple chains, with no limit to how many assets can be supported.
This means that the network can receive an asset on one chain, like Bitcoin, and send out an asset on another chain, like Ethereum.
It’s the first true cross-chain solution. /6
This means that the network can receive an asset on one chain, like Bitcoin, and send out an asset on another chain, like Ethereum.
It’s the first true cross-chain solution. /6
Liquidity pools are a new concept, but very powerful. Users are paid to stake their assets in pools together.
These assets are bonded algorithmically, such that depositing one asset into a pool will swap it for the other at the exact ratio of the pool balances. /7
These assets are bonded algorithmically, such that depositing one asset into a pool will swap it for the other at the exact ratio of the pool balances. /7
This means prices are always known, the volume is always real and liquidity is always available to the user.
It turns out that liquidity pools also prevent market manipulation, wash-trading and liquidity problems. /8
It turns out that liquidity pools also prevent market manipulation, wash-trading and liquidity problems. /8
THORChain is the future of trustless digital asset exchange.
You can learn more at thorchain.org
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You can learn more at thorchain.org
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