THORChain Q2 ’23 Ecosystem Report
1 April 2023 — 30 June 2023
Summary
In the middle of the bear market and THORChain has delivered several key features and has more on the way. THORChain is preparing now to be fully ready for the next bull market with fee reductions and network resilience improvements.
In the last three months, BTC savings was filled, POL was activated, lending development was completed which will complete the trifecta of swap, save and lend, BSC Chain Integration ready and the new feature streaming swaps will allow cheap whale swaps about to be launched. It has been a big three months for THORChain.
A Look at Q2 Network Statistics
Dashboard | More Stats | Even More Stats
- Total USD Volume: $520m
- Highest 24h Volume: $21.71m
- Change in Total Liquidity: $122.23m to $99.69m (-18.4%)
- Change in Savers: $25.73m to $29.46m (+14.5%)
- Liquidity Fees Collected: $1.98m
- LP Earnings Breakdown: 35.87% Liquidity Fees — 64.13% Block Rewards
Top 5 Swap Routes by USD Volume:
- BTC <> ETH — $133,789,950
- ETH <> RUNE — $117,905,920
- BTC <> RUNE — $97,479,059
- BUSD <> RUNE $47,447,727
- BNB <> RUNE $28,167,026
Top 5 Affiliates:
- Trust Wallet — $60,317,117 in 57696 swaps
- THORSwap — $34,674,374 in 7270 swaps
- Rango Exchange — $8,800,564 in 1638 swaps
- THORWallet — $4,121,678 in 1728 swaps
- ShapeShift — $3,119,364 in 1451 swaps
What’s New to THORChain in Q2 2023?
Savers & POL Update
Savers experienced significant growth, particularly in the BTC pool, resulting in multiple increases in the synth utilisation cap. The synth utilisation cap is now set at 60%.
Protocol Own Liquidity (POL) was activated through ADR 006, aimed at accommodating more Bitcoin savers with a target POL utilisation of 50%. For example, POL turns off/on when the synth utilisation reaches 50%.
In the later stages of the period, Saver Yield Scaling was introduced. This dynamic feature reduces the yield paid to savers in proportion to the synth utilisation. For instance, if the BTC pool has 50% synth utilisation, the Saver Yield is reduced by 50%, with the remaining yield allocated to Liquidity Providers. Pools with low synth utilisation will experience smaller yield reductions.
Dashboards are available to monitor the synth utilisation and monitor Savers yield and depths.
Dynamic Outbound Fee Improvement
ADR-008 Dynamic Outbound Fee Multiplier was passed implementing Dynamic Outbound Fee Improvements. Previously for outbound transactions, THORChain charged a fixed fee of 3x the gas fee (with a floor of USD 1 equivalent) for each chain to ensure prompt transaction speeds, plus excess to pay for internal transactions such as vault churns. THORChain now monitors the amount of RUNE collected for gas fees and the amount spent on gas. When the network has an excess amount of collected RUNE, users are charged as low as 1.5x the gas fee for the chain. As a result, users now pay approximately half the amount for gas, on average.
Best Effort Refunds from Inactive Vaults
Sending liquidity to inactive vaults has been an issue despite the inbound_address endpoint detailing the active vault. A change was added to monitor inbound assets to inactive vaults. If enough validators from that particular vault are still a part of the active set, the assets will be refunded to the sender. Inactive vaults from the past 500,000 THORChain blocks (approximately 34 days) will be monitored for inbounds of gas assets.
Effective Hard Cap
The effective hard cap a.k.a the security cap was reached limiting the amount of liquidity allowed to enter the network. This is a result of churn issues and recent market forces.
Node operators voted to increase the maximum number of bond providers to 10, previously 6 which will allow more bond to enter the system.
Updates to the churn process have also been made in order to increase the total bond.
Node Keyshare Backups
Previously, encrypted TSS keyshares backups on-chain was opt-in and used by less than half of nodes. Encrypted TSS keyshares on-chain backup is now enabled by default enabling any node to fully restore their TSS keyshares using only a mnemonic, greatly increasing the resiliency and censorship resistance of the network. Even in the event of sudden outages with a cloud provider, node operators could easily restore service.
Ongoing
Lending
Implementation of the first-ever lending product with zero interest, no liquidations and no expiry is complete and the final design has been detailed in this video and the on the THORChain docs.
THORChain has engaged the Block Science team to conduct an Economic Analysis, Risk Report and Simulation Framework of Lending to fully understand its impacts. Currently, the analytical research is complete and the focus will shift to modelling the lending system. The context gained from the initial research will motivate specific scenarios for simulation.
Block Science is currently working on:
- Analytical derivation for starting parameter recommendations.
- Revised Risk Research Report — targeting completion in 2nd week of July. Results will be used for Lending ADR.
- CadCad modelling/ Simulation — work ongoing.
Launch of lending has several distinct phases:
- Block Science engagement, as detailed above, to help create the Architecture Decision Records (ADR) for Lending.
- ADR is released for discussion and then presented to Nodes for voting.
- Soft launch — Limited Testing on Mainnet to gain feedback.
- Hard Launch — Scaling for Lending
Streaming Swaps
Streaming swaps is a new feature that allows large swaps to be automatically broken up into multiple smaller swaps, and have the outputs sent as one outbound transaction — which results in significantly less slippage fees paid.
This feature allows THORChain to be competitive with CEXs for large native cross-chain swaps, e.g. whale swaps. It is expected to be released by the end of July and can be expanded to be used in Savings and Lending deposits/withdrawals in the future.
BNB Smart Chain (BSC) Integration
Nodes indicated their support to add Binance Smart Chain (BSC) to THORChain. BSC integration was completed however the network had reached the effective hard cap and launching BSC involves adding liquidity to the network. A decision has been made to defer the BSC launch until such time there is sufficient capacity to ensure a successful launch.
Affiliate Preferred Assets
A new `AffiliateCollector` module will be created. Affiliates can specify their preferred asset then automatically distributed in the preferred asset of the affiliate instead of only being in RUNE. It is expected to be released by the end of July.
Killswitch Completion
The ERC-20 and BEP-2 RUNE “killswitch” is due to be completed mid-July. The exact timing will vary depending on block times.
Planned Obsolescence Update
- Gitlab/Github admin — handed over to Nine Realms ✅
- Twitter account control — handed over to Nine Realms & Community ✅
- Vesting — Will end mid-July along with completion of the Killswitch ⏲️
Mimir Admin Keys ⏳
- Mimir Admin key exclusion list is in place and expanded.
- Mimir revamp proposal created which requires a Mimir audit and code updates
Treasury Control — Transfer in progress ⏳
- Geographically separated directors have control in using a mulitsig set up.
- Directors are taken from the core team, 9 Realms and the community with no direct dependency on either.
In the Pipeline
- Release of Streaming Swaps
- Release of Affiliate Preferred Assets
- Launch of Binance Smart Chain
- Lending Soft Launch
Cold Vaults
A new feature that would allow the scaling of bond for the network as the more bond, the higher the effective hard cap. This is in the early design phase and subject to change.
Cold Vaults are wallets (which could be a ledger or trust wallet) that secure exogenous capital for THORChain. These wallets contribute to network security (bond) and allow a higher value of TVL by reducing the amount of capital a sybil attack can steal (as funds are moved from Asgard aka “hot wallets” to “cold wallets”).
Integrations
Several Integration updates.
Trust Wallet
- Added support for more chains (LTC, BCH, DOGE, AVAX, ATOM)
- ERC20 Swaps on the way
- Ongoing $50k swap campaign with Trust Wallet.
Ledger Live
RocketX
Unizen
- Launched native BTC swap support
- Medium Article Announcement
Where to get more information?
- Twitter Spaces — held most weeks
- LPU University — monthly posts
- GrassRoots Crypto — monthly update videos
Community
To keep up to date, please monitor community channels, particularly Telegram and Twitter:
Website | Documentation | Twitter | Telegram Community | Telegram Alerts | Community Discord | Developer Discord | Explorer | Viewblock | Reddit | Github | Gitlab | Medium | Linktree | Thorcharts
