Cryptonary - NFA Episode 3 | THORSwap: Swap all your tokens on a single DEX
Primer: THORSwap is a cross-chain DEX aggregator that is built on THORChain. Mogarchy and Chad THOReau share how they got started in crypto, what amazed them about THORChain, and how they went on to join the THORSwap team. They also share about upcoming developments at THORSwap.
Background of Guests
Mogarchy is Engineering manager from THORSwap
Chad THOReau does content and education for THORSwap
Mogarchy
Been in crypto for about a decade
Before crypto, he was a big Ron Paul guy
As he learned more, he started to see the promise of cryptocurrencies
Around 5 years ago, he started a crypto lending company. Spent most of his time on regulatory compliance
Realized that he did not want to spend his life doing that
When he first heard about THORChain, he became excited
Bought some RUNE over a year ago
When the THORChain exploit happened last summer, he started getting more involved with THORChain
Someone from THORSwap noticed him and invited him to join them full-time
Chad THOReau
Got into crypto in 2013
Was fairly young and had no money
The concept of immutable money did not really click with him until 2019
Heard about THORChain at the end of 2020
Read the Multicoin Capital thesis about THORChain
“I'm like, wait, THORChain is doing this, but with every L1 asset, just the ability to have a true decentralized exchange across, theoretically, any of these incompatible blockchains. It just really struck me as such an obvious need for all of crypto and really captivated me.”
- Chad THOReau
Started to get involved in the space
3-4 months ago, THORSwap reached out to him and he joined them
What Is THORChain?
Easiest way is to think of it as a cross-chain or multi-chain Uniswap
Their liquidity pools consist of 50:50 RUNE and another asset
Users will be able to swap their native layer 1 asset for another native layer 1 asset
Enables chains like Bitcoin to earn yield by liquidity pooling
Their security model involves the nodes bonding twice as much value in RUNE than the other assets they are securing
Users do not even need to have RUNE or a THORChain wallet to use THORChain
Benefits Of THORChain Over Wrapped Assets And Bridges
Wrapped assets are not trustless. You are trusting a counterparty that you will be able to redeem that asset for the real thing
THORChain brings the ability to stay on your native chain
There are 6 chains on THORChain right now. Will be adding the seventh chain soon
“So you're not relying on some protocol or company to give you an IOU and say, hey, I promise in a year I'll give you that Bitcoin back if you want it. You're just gonna keep your Bitcoin so I think that's a really key distinction for the THORChain protocol.”
- Mogarchy
THORSwap and THORChain
Chad THOReau
THORChain is a cross-chain liquidity network. However, it does not have any user-facing product
THORSwap is the leading platform that everyone is using to interact with THORChain
Before the launch of the current multi-chain chaosnet, there was a single-chain chaosnet
The single-chain chaosnet was on Binance chain and was used as a testing ground. Back then, it was called BEPSwap. Now it has been renamed to THORSwap
Any interface can be built on top of THORChain
THORSwap has always been the leading interface for THORChain
Mogarchy
Likes to think of THORChain as the first protocol that THORSwap added
Will be adding other DEXes into the THORChain ecosystem
Upcoming DEX Aggregation Feature
Their aggregation contract is currently being audited by multiple security firms
Currently working on some of the interface and API around that product
The aggregator V1 may be out in the next month or two
Over time, there will be more routes and DEX aggregation that is plugged into it
Supported Chains on THORSwap
THORSwap supports the chains that are available on THORChain
For V1 of the aggregator, they will be supporting Uniswap V2 and V3 and SushiSwap
Instead of a multi-step swap, swaps on THORSwap could be done in a single transaction
Solana would be a potential layer 1, however, it is difficult to integrate
Team has been working very hard on the path finder to give users the best price
The Trading Blackhole
There are 2 trading blackholes:
On the THORChain level
On the THORSwap level
Both of them work together
It’s based on the concept that any asset can come into THORChain and the potential for liquidity and swaps will be orders of magnitude higher than a typical single-chain DEX
Swaps on liquidity pools accrue values to LPs
Have a staking contract called vTHOR. Users could stake THOR, the THORSwap token, to accrue fees from swaps on THORSwap
The APR for staking THOR is currently just shy of 100%. This is even before fee accrual to stakers is turned on
75% of the fees collected will be given back to stakers. The THORSwap system will only be getting a 25% cut
They will be releasing Medium articles and video tutorials when the new staking contract is about to be released
Educating Users
Chad THOReau
Realized the importance of education to onboard people
People have different levels of understanding
For people that need help with specific issues, they can visit the THORSwap Discord
Synthetic Assets And THORSwap
THORSynths just launched barely a week ago
It enables more frequent swaps/trades between various assets
Each Synth is redeemable for the underlying asset that THORChain has in its pools
Pricing will be tighter as people can quickly and cheaply do more swaps to keep the actual prices tighter
After being live for only 8 days, 1/3 of all THORChain volume is taken up by Synths
Currently, users can mint 5% Synths to Asset Depth of the Pool ratio to ensure that it is safe. Will increase the limit over time as it becomes more established
Reasons for Creating Synthetic Assets
Biggest reason is that layer 1s are slow and expensive
What Synths enable is almost instantaneous settlement while remaining economically secure
Synths are fully backed by the liquidity units in the pools of those assets
Another feature is that users can mint and redeem from any integrated asset (e.g. minting synthetic Ethereum from Dogecoin)
Every single synthetic transaction is on the THORChain blockchain and is transparent for all to see
Vision and Plans
Just starting to hit their stride
Have been extremely nimble and shipping things really fast
Have superstar developers who are always the first to ship new features
Have 20 developers on their team
Moving into a more formalized process of development and planning things more strategically
They will be rebuilding the entire THORSwap interface from the ground up with V2
Doing the same thing with THORYield — have redesigned the frontend recently. Will be working on the backend
vTHOR will be coming soon
How To Find Out More?
Follow THORSwap on Twitter
Their Twitter has links to their Discord, Medium, and YouTube videos
They have a 24/7 help desk
All information presented above is for educational purposes only and should not be taken as investment advice. Summaries are prepared by The Reading Ape. While reasonable efforts are made to provide accurate content, any errors in interpreting and summarizing the source material are ours alone. We disclaim any liability associated with the use of our content.