1/ $RUNE - Thorchain’s token - acts like a crypto index fund with network effects, with at the moment, a huge speculative premium. And the speculative premium is deserved because RUNE acts a crypto index fund with network effects. So for some perspective ..
2/ $BTC is off-shored, hard money with network effects. This money with network effects has done pretty well. BTC is also a very narrow purpose enterprise - it secures both the money and the ledger of the money.
3/ Enterprises come in many varieties and structures. A family is an enterprise. As are schools, grocery stores, mayors’ offices, discord channels, Apple, and so one.
4/ The fastest growing sector of enterprises are digital native ones which embed tokens to generate network effects to accelerate the growth of the enterprise and its target market.
5/ What if there was a way to gain economic exposure to the most significant of these digital native enterprises? What if that access was tokenized and itself had network effects? That is $RUNE
6/ To understand the crypto index fund aspect of RUNE, consider the collection of RUNE LPs that will be available over time. Each LP is one-half non-RUNE (BTC, ETH, BNB, LTC, BCH to start, with new ones added over time), and the other half is RUNE.
7/ If the values of all the non-RUNE tokens goes up 50%, arbitrage pushes up RUNE’s determined value contemporaneously.
The contemporaneous mirroring caused by the LP structure means that RUNE’s price will have qualities of index of the underlying non-RUNE LP assets.
The contemporaneous mirroring caused by the LP structure means that RUNE’s price will have qualities of index of the underlying non-RUNE LP assets.
8/ The market goes up, RUNE manages more value. RUNE goes up.
The index fund qualities are not necessarily market-cap weighted, but rather weighted by the relative size of the LPs. It is like an index nonetheless.
But wait. There’s more!
The index fund qualities are not necessarily market-cap weighted, but rather weighted by the relative size of the LPs. It is like an index nonetheless.
But wait. There’s more!
9/ LPs gain AMM fee income as value is transferred into, out of, and across Thorchain’s network of LPs - crypto’s first network that allows cross-chain value transfer.
10/ And in a world with dramatic growth of network-effected enterprises on many varieties of chains, the need for value transfer and associated fee opportunities will be massive.
But wait. There’s more!
But wait. There’s more!
11/ As the network grows because it provides superior economics to any passive form of crypto asset allocation, that growth deterministically drives up the value of RUNE. See this thread:
https://twitter.com/SlawTeh/status/1375516578796630022
12/ When non-RUNE assets are added to one LP and RUNE’s price is arbitraged higher, that price increase ripples across all the other LPs. They are arbitraged. RUNE is sold, and non-RUNE tokens are bought. More tokens are captured out of the market.
13/ If you start by 1 BTC and the equivalent RUNE into the BTC:RUNE LP, network growth buys you more and more BTC even if all the growth was in the BCH pool. Network growth cause value accretion.
14/ If an index fund is a low-cost, efficient investment vehicle. RUNE is like an index fund, mixed with exchange income and network growth value capture. Wait until they add borrowing and lending fee income.
15/ If BTC is money with network effects, RUNE is the BTC analog to nework-effected, revenue enhanced, crypto-native-enterprise index investing ..
16/ Well, let’s say that Thorchain may become the Blackrock of the crypto-verse and $RUNE is the way to own a piece of the rock, to in-prudentially remix corporate attributes.
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