THORChain restructures $200M debt into equity tokens
THORChain's (CRYPTO:RUNE) node operators have approved a proposal to address the platform's liquidity challenges by converting $200 million in defaulted debt into equity tokens.
On January 23, THORChain halted its lending and savings programs for Bitcoin (CRYPTO:BTC) and Ether (CRYPTOLETH) to prevent an insolvency crisis.
This suspension gave the community a 90-day window to develop a restructuring strategy aimed at stabilising operations and compensating affected users.
The approved proposal, announced on February 2, involves minting 200 million new tokens called "TCY," each representing $1 of the platform's debt.
Affected users will receive TCY tokens as airdrops, with one TCY issued for every dollar owed.
These tokens will entitle holders to 10% of THORChain's network revenue indefinitely, with payouts made in RUNE (THORChain’s native token) every 24 hours.
Aaluxx Myth, the pseudonymous author of the proposal, described the arrangement as offering liquidity providers potential upside while allowing risk-averse users to liquidate their earnings daily.
THORChain also plans to create a liquidity pool to facilitate the sale of these claims based on market demand, giving creditors the ability to exit as token values fluctuate.
However, concerns have arisen within the community about the long-term viability of the plan.
Some members are sceptical about its complexity and whether it will require further investment and trust in THORChain, especially given the platform's history of financial management issues.
Additionally, there are questions about whether the new TCY tokens could be classified as unregistered securities, which could lead to potential legal challenges for THORChain.
At the time of reporting, the THORChain (RUNE) price was $1.41.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Cardano Expected to Pump Over 10x in the Altseason, How High Can ADA Go This Bull Cycle

Ripple Rules Out 2025 IPO as Company Maintains Solid Financial Position

Google Chrome’s success ‘impossible to recreate,’ exec testifies in DOJ antitrust trial
Share link:In this post: Parisa Tabriz believes Google Chrome would decline in another company’s hands, saying it would be hard to disentangle Google from the search engine’s success. Google plans to infuse artificial intelligence into Chrome to make it more agentic. OpenAI showed interest in buying Google Chrome.
SEC Commissioner Hester Peirce calls for better crypto regulation
Share link:In this post: SEC Commissioner Hester Peirce has called for better crypto regulation in the United States. Peirce mentioned that financial firms have been approaching crypto in a way like playing “the floor is lava” children’s game. SEC commissioners want flexible regulation as SEC chairman Paul Atkins wants clear regulations for digital assets.
Trending news
MoreCrypto prices
More








