THORChain Q1 ’24 Ecosystem Report
1 Jan 2024–31 March 2024
Summary
In the first quarter of 2024, THORChain experienced significant growth, with a 53% increase in total USD volume to $19.3 billion and a notable rise in liquidity. The raised caps on the lending protocol resulted in over $150m of collateral deposits. Adjustments were made to make swaps cheaper and faster, with less time in the outbound queue. Looking ahead, the pipeline for mid-2024 includes developments like memoless transactions, limit orders, and batched outbounds — along with the ongoing effort to enhance scalability, security, and user experience on THORChain.
A look at Q1`24 network statistics
Dashboard | More Stats | Even More Stats
- Total USD Volume: $19.3b (+53%)
- Highest 24h Volume: $584m (+64%)
- Change in Total Liquidity: $339.38m to $503.97m (+48%)
- Change in Savers: $85.41m to $134.66m (+57%)
- Liquidity Fees Collected: $8.09m
- Affiliate Earnings: $4.9m
- LP Earnings Breakdown: 35.27% Liquidity Fees — 64.73% Block Rewards
Top 5 Swap Routes by USD Volume
- BTC <> RUNE — $4,126,227,171
- ETH <> RUNE — $2,461,641,520
- BTC <> ETH — $2,412,809,614
- USDT <> RUNE — $1,226,568,812
- BTC <> USDT — $1,177,616,237
Top 5 Swap Routes by Liquidity Fees (USD)
- BTC <> RUNE — $1,411,573
- BTC <> ETH — $919,923
- ETH <> RUNE — $895,368
- BTC <> USDT — $632,876
- USDT <> RUNE — $528,863
Top Affiliate THORNames by USD volume
- “ti” — $747,698,256 in 79,999 swaps
- “ss” — $596,880,458 in 4,913 swaps
- “t” — $595,902,628 in 16,530 swaps
- “dx” — $243,678,092 in 7,002 swaps
- “wr” — $116,918,261 in 4,734 swaps
- “td” — $82,868,915 in 32,589 swaps
- “tr” — $59,703,008 in 6,996 swaps
- “xdf” –$52,235,368 in 648 swaps
Other notable affiliates:
“dcf” with 1,252 swaps; “lends” with 619 swaps; “ej” with 607 swaps; “lifi” with 483 swaps; “ds” with 324 swaps
Lending Stats
- $160.6m in collateral (+$123m from Q1 start)
- 2302 total borrowers (+1667 from Q1 start)
- 4574 cumulative loans (+3349 from Q1 start)
New Integrations
- Li.Fi
- Cake Wallet
- Giddy
- Ordiswap
What’s new to THORChain in Q1 2024?
Swapper Clout
Swapper Clout is a new feature to reduce the trading delay times on THORChain, without substantially decreasing network security. Now, when you make a trade on THORChain, the liquidity fees you pay are added to your Swapper Clout. When you make more trades, your Clout value is subtracted from the total outbound value, making it so that frequent traders can receive their outbounds more quickly. This change makes the arbitrage process more efficient and also makes the network queue less congested for retail users. Since its implementation, it has had great improvements on THORChain average swap time.
ADR-012 — Scale Lending
This ADR proposed two changes to scale the lending protocol.
1) Set the Collateralization Ratio to a fixed 200% (50% LTV)
2) Burn the Standby Reserve (60m RUNE)
This ADR was passed by a node vote. The Standby Reserve was burned and the CR was changed — creating additional capacity for the lending protocol.
BNB Beacon Chain Ragnarok
It was announced by the BNB Chain team that the BNB Beacon Chain would sunset in mid 2024. As a response, Nodes voted to Ragnarok all BNB Beacon Chain pools, a best effort was made by the network to send funds back to all LPs and Savers, and finally all BNB Beacon Chain pools were deactivated.
Minimum Outbound Fee Multiplier Change
The Minimum Outbound Fee Multiplier was changed from 150% to 100% — meaning that the gas fees withheld from a transaction will be 100% of the gas cost, rather than 150%. This was done to decrease the fees paid by users for swaps.
Trade Accounts (shipped, but not yet enabled)
Trade accounts have been added to THORChain Mainnet, but have not yet been enabled as of the end of Q1. Trade Accounts are a new primitive built for frequent Traders and arbitrageurs. Trade accounts are assets native to THORChain that hold the price of the corresponding native asset. These assets are held 1:1 within THORChain’s vaults, but outside of the liquidity pool, utilizing excess security budget.
Trade assets are not held in user wallets, but instead custodied by a module, crediting individual users’ native THORChain address.
Trade assets are twice as capital efficient as Synthetic Assets, meaning that it takes half as much capital to arb the pools with Trade Assets as it does with Synths. There are no slip fees when entering or exiting Trade Assets from its native counterpart. Only outbound gas fees apply.
Minimum Swap Fee Mimir
A new mimir has been added, but not yet set. This mimir sets a minimum swap fee that the network will charge per-transaction. This can be used to set a minimum fee that a swapper must pay, to increase revenue to the protocol’s participants.
Incentive Pendulum Changes
The Incentive Pendulum now uses the “Total Effective Bond” rather than the “Total Bond” of the network, for increased economic security. The “Total Effective Bond” is the total bond of the 2/3 of nodes with the least bond, since that is the number of nodes needed to sybil attack the network.
The Incentive Pendulum was also changed to use the “Total Vault Balance” rather than just the “Total Pool Balance”. This is due to Trade Accounts holding assets within the vaults, but outside of the pools.
Outbound Delay Parameters Update
The MinTxOutVolumeThreshold has been doubled from 1000 RUNE to 2000 RUNE. This means that each block now has the capacity to send out 2000 RUNE, effectively doubling the amount of volume that can be sent out without an outbound delay. This was done to improve the user experience, and has increased the total capacity for the network to settle value without significant delays.
Midgard Pool APR Update
Midgard APRs have been changed to be earnings-based rather than LUVI-based. This means that APR figures are now based on only the earnings of a pool and its depth over the given period of time. Impermanent Loss or IL from Synths have no bearing on the displayed values.
The previous LUVI value also accounts for impermanent loss due to synths, but this also means that APRs are mostly an accounting of past price-performance and impermanent loss, rather than the earnings of the pool. Changes have been made to separate the pool’s revenue metrics from the complexity of Impermanent Loss.
In The Pipeline — What To Expect Mid-2024
A number of new features are being worked on by the devs to be completed mid-2024 (Q2 and beyond). These features will improve upon the scalability, security, and UX of THORChain. Several features will require governance to signal consensus from nodes before being developed.
Memoless Transactions
Memoless transactions will be a new way to “register” a memo before a transaction is made, so that a swap or any other action can be done without sending a memo in the actual transaction itself.
This will enable a new kind of swap interface where a user does not need to connect a specific wallet before swapping. The wallet interface can be completely abstracted away from the swap process. A user can register their swap intent on an interface, the interface can register the memo on behalf of the user, and then the user can simply send the exact amount specified to the inbound vault address and execute their swap on any wallet. QR codes can also be used to simplify this process and make it extremely accessible to swap with any wallet, even if that wallet has no relationship with THORChain frontends.
Batched Outbounds
Allows bifrost to send multiple outbounds in one single transaction. This change will increase TSS throughput significantly and also decrease user gas costs, since significantly less transactions will need to be sent. Centralized exchanges use similar logic today to save on fees, rather than sending 1 transaction for every single withdrawal. This will be rolled out slowly after being implemented for testing and security.
Limit Orders (Orderbooks)
Limit orders on THORChain will allow users to place orders that will automatically execute with the AMM as the counterparty once a certain price target is reached. This is not a traditional Central Limit Order Book (CLOB) where orders are executed against other orders and takers, but is a hybrid with the AMM design. Limit Orders will be built using Trade Assets as a primitive.
Solana and EdDSA Chain Support
Work has begun to add support for Edwards-curve Digital Signature Algorithm (EdDSA) with TSS as it currently supports Elliptic Curve Digital Signature Algorithm (ECDSA). This work will pave the way for Solana support later this year and then other chains that use EdDSA.
Ethereum Router V5
Upgrades to the Ethereum Router for transferOutAndCall, as well as adding support for Batched Outbounds.
Hard Fork
A hard fork enables upgrades of key dependencies that cannot be upgraded during normal software updates. This includes:
- Taproot address support (bc1p)
- Cosmos version update
- Removing archived code (cleanup)
Pending Upcoming Changes (Requires Governance)
These changes are in the design phase and will require node governance (ADR) to determine whether they will be adopted or not. These changes may or not be adopted or changed based on feedback from the community.
Additional proposed changes may come through the GitLab or Discord channels
ADR-013 — Synth Backstop
This ADR is underway as of early Q2. Once enacted, this ADR will cause Savers to be forcibly ejected and have their liquidity returned when synth utilization grows beyond a certain threshold. This will protect Dual Liquidity Providers.
ADR 14: Reduce Saver Yield Synth Target to Match POL Target
This ADR has been created to propose changes to the way savers yield scales with the synthetic asset utilization. This proposed change would decrease the maximum synth utilization at which Savers receive yield to match the point at which Protocol Owned Liquidity (POL) begins to deploy to the corresponding pool. Currently, there is a gap where Savers continue to receive rewards, but POL is still deploying assets.
Derived Asset Hard Cap
If adopted, this will create a hard cap on the Derived Asset liability. If adopted, this change will limit the liability that derived assets bring to the network, moving the risk of derived asset liability to derived asset holders.
POL Savers Match
If adopted, this change will have Protocol Owned Liquidity match Savers deposits. When a saver deposits into the vaults, POL will add the equivalent amount of liquidity. This will increase the rate at which POL is deployed, and deploy to more pools without needing to reach a specific synth cap.
Instant Swaps
Instant Swaps could allow interfaces to contribute a security budget to allow swaps that are confirmed instantly, bypassing normal security measures like confirmation counting. The interface’s bond is used as an assurance for protocol security, and will be at risk if there is malicious activity like an attempt to double spend.
Where to get more information about THORChain?
- Twitter Spaces — held most weeks, subscribe on RSS or wherever you get your podcasts
- THORChain University — educational content, monthly posts, & discord server
- THORChain University Updates — monthly update articles
- GrassRoots Crypto — update videos
Community
To keep up to date, please monitor community channels, particularly Telegram and Twitter:
Website | Documentation | X | Telegram Community | Telegram Alerts | Community Discord | Developer Discord | Explorer | RuneScan | Reddit | Gitlab | Medium | Linktree | Thorcharts
