RUNE, the inherent token of cross-chain decentralized exchange Thorchain, is currently among the top-performing digital currencies in the market, displaying a 31.5% surge in value over the past 24 hours.Thank you for reading this post, don't forget to subscribe!
Based on Coingeco’s data, this increase in value only emphasizes RUNE’s incredibly bullish performance over the recent weeks, with the token demonstrating a 115.0% and 212.3% climb on the 14-day and 30-day charts, respectively.
Notably, the sustained bullish trend in the RUNE market has led to the DeFi coin reaching a new yearly high of $5.31 and achieving a record daily trading volume of $1.28 billion.
Rise Attributed to Thorchain (Rune)
Upon analyzing RUNE’s meteoric rise in recent weeks, many analysts have linked it to the newly introduced functionalities on the Thorchain platform.
In the Thorchain Q3 2023 Ecosystem Report, the development team of the DEX declared the integration of new capabilities such as lending, streaming swaps, streaming loans, and savers for stablecoins.
In a post by a crypto analyst with the username The Wolf of DeFi on Saturday, insights were provided into how one of these features has propelled RUNE to new heights. The analyst attributed much of RUNE’s gains to the streaming swap feature, designed to automatically divide large swap requests into smaller requests for processing over time.
$rune Keeps achieving new heights. The reason for this is the liquidity flywheel. I’ll show you how it works and why it will exert pressure on $rune considerably. @THORChain Constructed on liquidity pools. As the infrastructure is used for swaps, liquidity providers make money. The fundamental aspect of…
– The Wolf of Defi ⭕️ (@thewolfofdefi) 11 November 2023
The Wolf of DeFi explains that the introduction of this update has led to an increase in the platform’s swap volume and the annual percentage rate (APR) paid to liquidity providers.
As expected, the higher APR will attract more liquidity providers to invest in RUNE, which acts as the base asset of each liquidity pool on Thorchain, creating a cycle referred to as the liquidity flywheel.
Furthermore, The Wolf of DeFi mentioned that each dollar value of non-RUNE assets deposited into the Thorchain liquidity pool is matched to its counterpart in RUNE by network nodes.
Subsequently, if an LP deposits $100 in BTC/RUNE, comprising of $50 BTC and $50 RUNE, nodes will harmonize this transaction with an additional $50 RUNE, intensifying buying pressure in the market, propelling the token upward. Maintains a forward trajectory.
RUNE Price Projection
Upon observing the daily chart of RUNE, the Relative Strength Index (RSI) stands at 87.24, indicating that the token is firmly situated in the overbought zone. Hence, investors are cautioned to remain attentive to potential drops in prices.
Conversely, RUNE may continue to uphold its bullish momentum, particularly as the Thorchain team prepares to introduce more enticing functionalities including order book trading.
At the time of writing, RUNE is currently priced at $5.10, showing a 3.2% increase in the past hour. Meanwhile, the token holds a market cap of $1.58 billion, positioning it as the 41st largest cryptocurrency in the market.
RUNE is trading at $5.109 on the daily chart. Source: RUNEUSDT chart on tradingview.com
Featured image from iStock, chart from TradingView