The price of the native token of the cross-chain protocol THORChain (RUNE) increased by 34% yesterday amid the activation of pools of synthetic assets.
At the moment, the price of the asset has corrected by 10% and RUNE is trading at $4.96.
Synthetic assets or “synthetics” are tokens with a collateral guarantee, whose price is based on the value of other tokens. The THORChain protocol uses pools for collateral, consisting of the base cryptocurrencies and RUNE in equal proportions.
THORChain lead developer Chad Barraford has explained this approach improves the security and resilience of the network:
“Because the synth is half backed by $RUNE, it can always ensure economic security of the synthetics, and that the network security is always greater than the value of the synthetics, even if they go 1000x up in value.”