1. Basic potential information about $RUNE
Blockchain: Native token of THORChain, used within its own network.
Symbol: RUNE
Total maximum supply: 500 million RUNE
Operating mechanism: Tendermint-based Byzantine Fault Tolerant consensus (similar to Cosmos)
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2. The role of RUNE in the THORChain ecosystem
RUNE has several important functions:
Liquidity: RUNE is paired with all other assets in the pool (e.g., RUNE-BTC, RUNE-ETH…), making it central to the entire liquidity system.
Transaction fees: All transactions on THORChain incur fees paid in RUNE.
Network security: Used for staking by the nodes operating THORChain.
Governance: Although THORChain does not yet have a complete DAO governance mechanism, RUNE plays an important role in coordinating decentralized decisions in the future.
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3. Tokenomics and distribution
Emission Schedule: Initially there is inflation to incentivize liquidity and node operators. Inflation decreases over time.
Security mechanism: Nodes must bond (lock) an amount of RUNE double that of the RUNE in the pool — to ensure the safety of user assets (the "incentive pendulum" mechanism).
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4. Advantages and potential
True cross-chain DEX: Does not use wrapped assets, but native swaps.
No need for bridges: Reduces security risks due to bridge errors (bridge hacks).
Capital efficiency: The RUNE mechanism acts as an intermediary to optimize the capitalization of the pools.
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5. Risks to be aware of
Security risks: Although it was hacked (July 2021), it has since recovered and improved the system.
Relative centralization: Some parts of the system are still managed by the core team, not yet fully decentralized.
