Thread by @ChadThoreau

1/ Just as $UST disrupted centralized stables like $USDC and $USDT..

@THORChain's decentralized THOR.BTC can disrupt ~$13B of centralized wrapped $BTC.

While burning shit tons of $RUNE, like $LUNA does for $UST.

🧵👇

2/ Part of #THORFi will include a new type of synthetic called "derived assets."

These will be similar to the existing synthetic assets but the backing is different:

THORSynths are backed by LP (50:50 asset:RUNE).

Derived assets burn and mint the equivalent $RUNE.

3/ The focus for THORSynths is to quickly and cheaply arb the pools.

But there is a cap in terms of synth depth vs. LP depth, as to not strain LPers.

Whereas derived assets are theoretically unlimited, making them better for many new use cases.

4/ The primary use of a derived asset like THOR.BTC will be in THORSavings:
Deposit $BTC, earn $BTC.

On the backend:

$BTC swaps to $RUNE, $RUNE burns, THOR.BTC is minted.

And the yield comes from loan collateral from the borrower side.

5/ That’s already the best offer $BTC has ever seen and will burn loads of $RUNE, but that’s not the only use for THOR.BTC:

What if there was a decentralized alternative to wrapped $BTC on other chains?

6/ Imagine THOR.BTC on IBC or as an ERC-20..

This is totally different from a wrapped asset. Let’s go here first then get back to the $RUNE burn...

7/ Wrapped $BTC means that some entity (usually with a multisig) locks up a bunch of real $BTC, and issues a token that represents it.

You trust that it’s redeemable and backed.

Sound kinda like $USDT?

8/ Both THORSynths and derived assets are transparent and always provably redeemable.

So like choosing $UST over $USDT, wouldn’t you choose THOR.BTC over WBTC?

9/ So if there’s a decentralized and reliable tokenized $BTC available on IBC, Terra, Ethereum, etc…

Seems like something that would be heavily used in defi across many chains.

10/ And further in the future, what if the yield-bearing THORSavings BTC was tokenized?

So not just THOR.BTC but a sort of “aUST” (or vTHOR 👀) version of BTC?

Maybe an aBTC/OSMO pool, or aBTC/LUNA, aBTC/ETH (aBTC/aETH..?)


Sky’s the limit. Composability on yield-bearing BTC.

11/ So all of these THORSavings $BTC deposits, and this better tokenized $BTC on other chains..

All burns $RUNE to create it.

12/ THOR.BTC always has a claim on the equivalent native $BTC (less swap fees).

Technically, it mints an equivalent value in $RUNE.

THORChain has no external dependencies. Its native $BTC in its pools are priced against $RUNE.

13/ So you effectively have the entire TVL backstopping all derived assets (including THOR.USD).

Because you have native assets against $RUNE, and $RUNE against derived assets.

14/ TL;DR

THOR.BTC will be a decentralized alternative to wrapped BTC, and all minting of it will burn $RUNE.