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You may be aware, there are numerous methods for predicting the price of a cryptocurrency.
You can utilize technical analysis patterns, on chain analysis, sentiment analysis, and even plain old Google Search Trends to do your research.
Developer activity, on the other hand, is a crucial measure that no one seems to be paying attention. After all, cryptos can only gain adoption if they have some kind of value or use case, and these are all created by super coders.
Disclaimer:
- I am not a registered investment, legal, or tax adviser or a broker/dealer, and all opinions expressed by me are from my research, for educational purposes only.
What is the THORChain protocol? (RUNE)
THORChain is a self contained blockchain built with the Cosmos SDK that will act as a decentralized cross-chain exchange (DEX).
It employs an automated market maker (AMM) model similar to the early versions of Bancor (BNT) and Uniswap, with THORChain's native token (RUNE) serving as the base swap pair. Traders can move between multiple asset pools using RUNE as a sort of hidden intermediary in this arrangement.
It also pays a portion of trading fees to liquidity providers (LPs), who deposit or "stake" assets on either side of a liquidity pool.
AMM model to facilitate cryptoasset swaps an independent cryptonetwork that aims to enable the exchange of assets across disparate blockchain networks in a non-custodial manner, Its protocol features a cross-chain bridge system.
What year did the THORChain project start?
The THORChain project began in 2018 with the belief that using centralized exchanges to transfer cryptoassets between blockchains was problematic.
The long term solution was non custodial exchanges, often known as decentralized exchanges (DEXs).
As a result, the THORChain team set out to create an independent blockchain that could connect to external networks and permit cross-chain transfers, much like a DEX.
Finding sufficient liquidity is a common issue for DEXs. Traders want platforms where they would not lose money owing to slippage. However, it is these same traders that supply sufficient liquidity to prevent slippage in the first place. In response, the THORChain team intends to use an updated version of Bancor's "smart token" to achieve Continuous Liquidity.
Tendermint BFT (Byzantine Fault Tolerance) is used as the consensus method in THORChain because it is a Tendermint-based chain, Proof of Stake (PoS) is also used for Sybil resistance.
A system of validators can stake RUNE tokens to run network nodes and validate transactions as part of the PoS aspect. Token holders can delegate to validators on THORChain, which keeps validators in check and allows delegators to get a share of each block reward.
Node Protocol's
THORNodes provide service to the THORChain network, which is expected to have 99 nodes at first. Each THORNode is made up of a cluster of multiple separate servers.
To construct a cross chain swapping network, all THORNodes communicate and function together.
What THORNode is made up of:
Thornode
A daemon that runs the THORChain chain as well as an HTTP server that provides the chain with a RESTful API.
This daemon establishes connections to external chains (such as Bitcoin, Ethereum, Binance, and others) in order to both observe (incoming/outgoing transactions) and sign/broadcast outgoing transactions (moving funds on remote chains). To get a single IP address for numerous installations, use the THORNode gateway proxy.
This daemon is a layer 2 REST API that provides semi-real-time rolled-up data and analytics from the THORChain network to front-end customers. Midgard will handle the majority of network requests. This daemon exists to prevent the chain from receiving a huge number of queries.
Making the decision to run a node should be carefully studied. While there might be big payoffs/rewards, there can also be significant expenses.
Risk of running node
To run a node, you'll need a substantial quantity of Rune, presently 1 million. This Rune is sent into the network as a "bond" and used as leverage by each node to ensure that they act in the network's best interests. This bond is slashed when a malicious or unreliable node is used.
Profits made on the network are wiped out by slash points. A node loses 1 block of revenues for every slash point it receives. If a node account has more slash points than active blocks, the node account will forfeit the bond equivalent.
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