Thorchain

LeoFinance
6 days ago
(edited)
2 Min Read
450 Words

What is it

THORChain is an computer code application which creates a network allowing what are called atomic swaps between cryptocurrency tokens from different blockchains. This is called Cross-Chain trading.

Why is this important?

This is important, because most cryptocurrency tokens have to be purchased on exchange. To buy cryptocurrency you normally need to go to the exchange web page, open an account, deposit dollars or your local currency, buy Bitcoin, the trade Bitcoin for the cryptocurrency you want. This Trading of Bitcoin for your desired cryptocurrency is also called an Atomic Swap.

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Sometimes a cryptocurrency you want is not traceable for Bitcoin. This means there is no Trading Pair. But there is another trading pair between your desired coin and another cryptocurrency like Ethereum. In this case you would navigate to the exchange webpage, open an account, deposit dollars to buy bitcoin, trade or swap Bitcoin for Ethereum, and then trade or swap Ethereum for your desired coin.

As you can see it is sometimes complicated to trade or swap cryptocurrencies.

One way of simplifying this process involves eliminating the need for the exchange, and eliminate ting the need to trade for several different coins to find a trading pair for your desired coin. It is called an atomic swap. In an atomic swap you trade your cryptocurrency for the one you want in one step. When you perform an atomic swap you trade one token for another without using an exchange. This is popular because it eliminates several steps in obtaining your desired cryptocurrency.

Investors interested in this technology buy the Rune coin. It has appreciated in value this year due to interest in owning it, as a means to profit from the widespread use of the Thorchain network, which is anticipated to happen in the coming year.

There are other ways to benefit from owning Thorchain Rune. The Thorchain network requires “Nodes”, these are computers with copies of the Thorchain network software. They monitor the cryptocurrency blockchains around the and the atomic swaps occurring between them for honesty and accuracy, there are also specialized nodes which defend the Thorchain network from cyberattacks. The people who want to run these nodes buy a certain amount of Rune, they deposit it in an interest bearing account, through a process called staking. They download special software to their computers and the software does the work of protecting the network.

I think Thorchain is an interesting investment. I suggest you read my other articles about Atomic Swaps to increase your understanding.

@shortsegments

Article about Thorchain and Blocknet Link

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My article about cryptocurrency exchanges Link

My article about Blocknet Link

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