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Yo!!!!!!!!!!!!!!!!!!!!1
Looks like I'm not going to lose my 0.25 BTC after all... although I may be trapped within the confines of this new shitcoin for an indefinite length of time.
As I have reported on a few times now Thorchain is insolvent due to shorting BTC and ETH and longing RUNE in the zero-liquidation lending scheme. Personally I thought this would create a flywheel that lasted well into the bull market. That didn't happen. RUNE did not outperform BTC or ETH and the debt spiraled out of control in record time.
Many have tried to compare this situation with the Luna collapse, but this is not appropriate for several reasons:
- Luna didn't freeze their bad debt until after crashing to zero. In fact Thorchain debt ratio is still below 40%, and even Hive's ratio can cap at 30%.
- Total debt owed is much less (~$200M)
- Thorchain is a smart community and Do Kwon was a single dummy.
- BTC/ETH are way more correlated to RUNE than LUNA was to USD.
- It's a bull market year not a bear market year.
My BTC and everyone else's BTC/ETH is trapped within a frozen insolvent bank vault. However, a proposal has passed that will change that.
https://gitlab.com/-/snippets/4801556
TLDR!
- For every dollar owed to the user they can claim 1 TCY.
- TCY will scalp 10% of the network's trading fees.
- Users will be able to buy and sell TCY on the open market.
all the sudden they are aligned...
The Thorchain network is using this opportunity to get all users on the network to be in sync when it comes to the financial incentives. In previous iterations there were splinters of users who didn't care if Thorchain was getting volume and revenue. They were going to get paid either way. Now a push is being made to get everyone on the same page. More revenue will end up benefiting everyone on the platform under the new tweaks in place.
This is a very interesting bankruptcy protocol because it may actually work out pretty well in the end... especially considering this is the beginning of 2025 and the four year cycle tells us we still have a year's worth of bull market runway.
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This proposal is going to fix a lot of problems with Thorchain, not just the savers and lending programs. They are even talking about removing the block reward and existing solely on trading fees. All the fat is being trimmed on this update.
The timing is impeccable
Imagine if this new token rolls out in like 3 months. It's quite possible (and even likely) that we are in the middle of an alt-market by then, in which case an asset like this would be much better received. Time will tell.
Having the pool start at $0.10 (as low as 1-2 year payback) ensures that TCY is not immediately sold for RUNE en masse to dump.
Starting price of $0.10
TCY needs to reach $1 before everyone is considered to be fully paid back. However, it will only start at 10 cents to make sure no one can dump right at the start and exit before the process has even started. This LP will be seeded with $5M from the treasury in a non-profit fashion. This means that any user that really wants to exit immediately will have the option to do so... but they'll only get back 10 cents for every dollar they were owed.
The idea here being is that there will be at least some users on the outside who are going to want this token... because it's going to earn 10% of TC's yield forever. The treasury is also considering doing buybacks on the token to buy back the debt and reclaim some of that yield back to the network.
What are the numbers?
Well the 2024 figure I've seen thrown around was something like $30M in fees last year. TCY would get $3M of that. $3M/$200M = 1.5%... so many are saying this could take up to 50 years to payback. Of course assuming that the network isn't going to grow is a mistake. Also this figure starts at x10 because the token price is being haircut by 90% at the start. Essentially the lower the token price of TCY the higher the yield will be. And the higher network revenue is the higher the yield will be. And a higher RUNE price will also boost the value of TCY as this is the only pairing... So it does have interesting free-market mechanics right at the ground floor.
In fact if the yield was 1.5% with a revenue of $30M... this sounds bad but it actually implies a token price of $1... which means everyone has already been made whole and the entire system worked perfectly. It's very possible a token like this can have much higher speculation than actual fundamental yield to justify the current price, again... especially in a bull market. If this were 2026 the situation would be pretty bleak IMO, but it's not. Just another difference between this situation and LUNA.
Make a shallow ($500k) RUNE/TCY pool at $0.10 per TCY (or 2 year payback for buyers), then use $5M of treasury funds to buy $500k per week for 10 weeks.
The initial RUNE/TCY pool would be quite small, but the treasury will do buybacks every week for 10 weeks. Certainly this is more to incentivize outsiders to bailout the debtors that have been bailed in. If outside capital knows that money will be flowing into the pool on a guaranteed basis >> they will frontrun the buying.
Something tells me that this token will not stay 10 cents for very long, but it also probably won't get to $1 very quickly either unless a lot of outside capital is interested in this trade. It's also unclear how many debtors will actually be happy with their TCY and just hold onto it instead of exiting the platform. Even I'm not sure about what I will do when my tokens are liquid.
So where did this solution come from?
Justification
The $MAYA token works exactly like this
The liquidity token of MAYA is CACAO, but MAYA also has a MAYA token that works exactly like TCY will work. 10% of yields on MAYA go to the MAYA token, and this token is quite popular. Hopefully TCY will be just as successful even though it's being used as a mechanism to repay bad debt.
In other news:
Eh is crypto making a comeback here?
Bitcoin has reclaimed $100k+ but the funding rate is still negative.
We may have just signaled the end of this crab market with one last squeeze.
Longs are getting paid by the shorts.
This is very rare and almost always leads to bullish price action.
Sovereign wealth fund
All the Bitcoiners are like see he's gonna buy Bitcoin.
Meanwhile he talks about buying TikTok.
It's very unclear.
Well that's fun
According to this chart we are smack dab in a pattern of getting squeezed right before the altmarket starts. Could that have been the squeeze before we visit the moon-castle? Hopefully!
Binance & Wintermute manipulation?
In addition to trade-war fears many are accusing Binance of manipulating the market yesterday in conjunction with a market maker named Wintermute. Evidence for this happening is not exactly ironclad but there are some suspect transfers back and forth.
Is Trump fabricating a crisis to force lower rates?
Ol Jacky boy seems to think so.
This is a pretty in-depth take on the whole tariff situation.
Not sure if it's accurate but it's somewhat interesting.
Conclusion
It's nice to know I'm going to get my money back from Thorchain... even if I do get trapped in a shitcoin that could crash to zero. I don't think that will happen as the way this thing is setup seems pretty decent. Because the bulk of this proposal's code already exists on Maya it's not going to take very long to put this thing into effect. Could take several weeks or several months. Either way is fine with me.
Math must not be my strong suit. Seems to me you're expecting about an order of magnitude more TCY than you can claim. Unless BTC mooned while I wasn't looking?
Thanks!
When we were first looking at the proposal there was some confusion as to the units being used.
I thought I would receive x10 the coins because the starting price was 10 cents.
That starting price is very low to make sure no one gets an unfair advantage and exits immediately.
At the end of the day it doesn't matter if I get a million tokens to represent the debt owed to me or 1 token.
The units are arbitrary.
@edicted
So I have a thousand dollars in Thorsavers, at TCY dollar per dollar, I would get 1000 TCY.
But in the liquidity pool it's rune/tcy and TCY is valued at ten cents.
That makes me wonder if I will actually get 10,000 tokens.
What number would you calculate?
Thanks
you get 1000 TCY
The opening price is 10 cents to allow people from the outside the bailout the debt and take the yield offered for themselves. I'm actually thinking about buying some if I can get them at 10 cents.
@edicted
Wow, so I could ten-fold my stake by matching what I have there, if I can get the tokens at 10 cents.
That's pretty tempting, possibly greed talking, but getting a share of the profits of an exchange which seems to increase it's swap volume every year seems like a retirement stream of income.
The numbers are a little high, 200 million tokens, 10% of 1 billion dollars or 100 million dollars divided by 200 million tokens is 50 cents per token or 500 dollars per thousand dollars of assets deposited in Thorlend or Thorsavers, per year.
If my math is right...
This is per year in perpetuity.
You would earn 12,500 per year and get back your BTC in 2 years?? If my math is right.
This sounds crazy.
I must be calculating something wrong.
Where did you get the $1B figure from?
Number I see being thrown around is $30M in 2024.
I was wrong....
I searched for Thorchains quarterly report, in medium by nine realms ..
56.2 billion in swap volume the last quarter of 2024 and several terms I need to research better. I think I multipled 329 million by 4 and rounded it to 1 billion thinking swaps were growing and the last quarter was the highest.
Source
RUNE is still going to be around too? I wonder if now is a good time to buy into it if they are going to bring back some value. I am glad that you are hopefully going to be made whole again.
A lot of people are wondering this but the network being saddled with debt like it is looks like a pretty big burden. Like if you were betting on which donkey is going to make it up the hill do you pick the one loaded up with 1000 pounds of gear or the one that isn't?
Now that I'm being bailed into the network like this I don't really have to worry if I'm underexposed... my stake in the network has just tripled.
Those are some good points!
Tell me more about the RUNE
Wow! I was wondering why $RUNE crashed so hard. Thank you for the information. Is it your professional certified financial advice that I should buy some RUNE right now?
While the current price of Rune is very low it is also a network that's been saddled with bad debt.
This is an extremely high risk scenario.
The network is DEPENDING on network fees and degens to bail them out of this scenario.
I'm personally considering buying CACAO here as the MAYA team is the one that fixed this mess.
In the immediate short term the smartest thing to do here is probably just buy Bitcoin and wait until we get confirmation of another alt-market. You'll basically miss the first pump on alts but BTC will probably also be up 20% or more.
Thank you sir!
Cult like, is it not, bit like convid, please be in my cult, world is changing, no to cults
Getting haircut and bailed into the bank is one of the most mainstream financial debacles out there.
Not quite sure what you're referring to here.
There are plenty of users who read this post and are like "shit I better stay away from that dumpster-fire"
I guess you're one of them, in your own fun little way.
I am a simple cunt, I just grow food, organic, no pesticide shite, yeh I am one of them.
:-)
The THORChain TCY thing is a pretty interesting. Sounds like you'll get 25,000 TCY. At current network earning rates, that would generate ~ $3,750 in revenue per year (unless revenue goes up or down; I think it'll go up).
And because of that earning potential, there'll surely be a good market value for TCY, so you could sell at any time instead of waiting for revenue generation.
I don't think I'll get 25,000 TCY because I still owe back $7k on the loan.
I feel like a lot of people aren't factoring this in.
Right, well 18,000 TCY then.
Either way, it's a vehicle for a lot of earning potential. If THORChain doesn't majorly screw up again, I can easily see it being an attractive commodity.
I thought you might want to read this post by a @thedessertlinux a Dasher who reveals some interesting issues about Thorchain.
https://hive.blog/crypto/@thedessertlinux/thorchains-rise-fall-and-rebirth-eau
Thanks, I'm going to read that.
Thanks for recommending it! I find very few people understand THORChain.
I don't know if it is a matter of fashion, but I do know that this decentralized exchange asset gives a lot of confidence, even if we don't fully understand why.
Thank you for this information, @edicted
Nothing ever good comes from this setup lol
Thorchain.org PodCast on Proposal 6 : which gives all Asset holders for ThorSavers and Thorlend equity token TCY one token for one dollar of debt owed to you by Thorlend and ThorSavers
https://thorchain.org/
Tyc huh, i might give this token a try, but with the vuew3 of things its either two things, it might either pass that $1 or fall below, how i figured its all planed and sorted out which might not fail the main objective
I expected it to happen but not that fast, My ETH is kind of stuck as well. I'm treating it as a dead money now and hopefully if i get something back, it would be a nice treat.
At least they are trying and the plan doesn't seem foolish: I hope it works and it helps save TC, thus allowing you - and other users - getting back your money.
Excellent.
@edicted Let me break down my thoughts on this market situation in simple terms!
The key thing here is that people are looking at a token called TCY that's priced at 10 cents right now. When whales (big traders) see this opportunity, they'll probably buy up tokens before others can - that's what we call frontrunning in crypto!
Just like $MAYA and its CACAO setup, TCY is trying something similar. Think of it like getting a slice of the pie - in MAYA's case, token holders get 10% of all the yummy yields. Pretty sweet deal, right?
Now about Bitcoin hitting $100k - that's super interesting! When we see funding rates going negative (meaning short sellers are paying the long buyers) while price is going up, it's usually a bullish sign. It's like when everyone thinks the price will go down but it keeps going up instead - this can cause a "squeeze" where short sellers have to buy to cover their positions.
The market seems to be waking up from its sideways movement (what we call "crab market" because it moves sideways like a crab). When shorts are paying longs during a price increase, it's kind of rare and often means we might see more green candles ahead! Thanks for posting this.
I hope u get it and all works out for u! 👊😉😎🤙
!PIZZA
That sounds interesting and I'm grad you recovering
I have no funds trapped but I see the solution as likely sound in design and,like you say,will attract outside interest when TCY becomes available. Even when the shit hit the fan I thought nah it will be alright. We shall see in time.... Thumbs up to Aaluxx at Maya and all those involved in developing a way forward.