Thread by @wolf_of_defi

1./ #RAISETHECAPS

#RAISETHECAPS is something we see coming by a lot in the @THORChain community. What are those caps? Why do we have these? Why should they be raised? And most important, what is the impact of it on $RUNE?

Let me explain 🧵

2./ @THORChain is a cross-chain liquidity protocol where users can swap native assets against each other. Without wrapping or pegging assets.

To enable users to swap a certain asset, a liquidity pool of that specific asset needs to be available on #Thorchain.

3./ For example, if you want to swap native $ETH for native $BTC there are 2 liquidity pools needed. The first one is $ETH / $RUNE, the second one is $BTC / $RUNE. As you can see, both are paired against $RUNE. This is the case for every asset on @THORChain.

4./ So what are those #Caps about?

The caps are in place to protect the users and the network. This is needed because @THORChain is still in test-net. Once mainnet launches the caps will be removed. As long as the caps are in place, there is a max of liquidity to be added.

5./ Mainnet is planned for January which is not too long from now 👀

Once mainnet launches, the caps are removed and people can add as much liquidity as they want. And how do we know people want to add liquidity?

6./ Well, the #RAISETHECAPS hashtags are there for a reason. Because of the impermanent loss protection providing liquidity on @THORChain is very interesting.

Next to this, more chains are expected to be added to @THORChain.

7./ Currently #BTC, #ETH, #LTC, #BCH and #BNB chains are connected. #Terra will follow soon.

@THORChain is going to be the place to be if you want to swap assets cross-chain and to make this happen, liquidity is needed.

8./ So what is the impact of $RUNE?

As previously explained, there should always be 3 times the amount of $RUNE locked in the protocol compared to the other native assets deposited. So adding $1.000$ of $BTC means locking another $3.000 worth of $RUNE

9./ At the moment there is a basically a maximum $RUNE being locked because of the #Caps. Once the #Caps are being removed, the gates are open to lock more and more and more and more $RUNE. The supply will drop like a rock while the demand is expected to skyrocket.

10./ I expect $RUNE to make a great run when mainnet launches.

The community is one of the strongest around and @THORChain is building the next step of decentralisation.

I don't know about you, but I'm not gonna mis this one 🚀🔥

#RAISETHECAPS

11./ If you want to check the status of the fund caps you can check app.thorswap.finance @THORSwap

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