THORChain’s security depends on MCP and incentives. In this post I’m laying out my thoughts on the security of THORChain network. I challenge the likelihood of an economically rational attack with an end goal of re-discovering for myself the bonded/pooled safety threshold

THORChain in a nutshell (doesn’t makes sense but go for it)

THORChain is a decentralized liquidity network that pools together native external assets such as BTC, ETH, BNB etc. to allow trustless, secure, permissionless cross chain swaps. Pooled external assets are simply funds that are sent to addresses on their native chains which are controlled by supermajority (>2/3)…

To wash away any skepticism from the very beginning i want to start off quoting Zaki Manian who calls Avalanche the “last breakthrough in consensus algorithms”

If you have been involved in crypto there is good chance you have seen the triangle below known as the blockchain scaling trilemma

Blockchain Scaling Trilemma

Many alternative blockchain implementations since Bitcoin showed us that it is very hard for any blockchain to improve across all 3 axises. Usually an improvement in scalability comes with a sacrifice in either security or decentralization(or both). …

Arguably, the most important success measure of THORChain is how productive the circulating Rune is. In this post I will visualize the productive Rune vs Speculative Rune.

What you see below is the current supply breakdown of all Rune that will ever exist. Each segment’s area is proportional to corresponding actual current Rune supply (= USD value)

Let’s take a look at each segment in detail and analyze how they can grow or shrink relative to each other to better understand the dynamics in play.

Pooled Rune

You woke up to learn that you can free claim at least 2000$ worth of coins. What is the wise move? Should you sell or hold? maybe even buy some to own more? Eventually your move depends upon what others do with their free claims.

I’ve analysed blockchain data to gather insight on behaviour of UNI stakeholders.

UNI Stakeholders

The chart above is an Euler illustration of 3 different groups of UNI stakeholders; free claimers, buyers and sellers. The size of bubbles represent the number of unique addresses corresponding to each stakeholder group and their intersecting sub groups. The study… aims to create a low volatile currency following 10 kWh electricity price.

Meter uses a hybrid PoW/PoS solution; PoW mining for stable coin creation and PoS for txn ordering

  1. MTR is stablecoin soft pegged around the global competitive price of 10 kwh electricity
  2. MTRG is the finite supply governance token, which is used by PoS validators to validate transactions.

Pow mining in Meter is as open and decentralized as in Bitcoin but differs from that in Bitcoin in two fundamental ways

1. Block rewards are dynamic. It’s determined as a function of pow difficulty. The wining Meter miner will…

Cost of Production

Meter uses dynamic block rewards to achieve stable cost of production.

Moore’s Law says the amount of energy needed for the same amount of hash power drops by half every 18 months (= 540 days). Assuming a gradual upgrade on mining equipment, the future efficiency of sha256 mining is calculated as

Efficiency(Day) = StartingEfficiency * 0.5 ^ (Day / 540)

Whatsminer M20S, a sha256 mining equipment currently used in mainstream, operates at an efficiency of 49J/Th requiring 3360W power to perform computations at 68Th/s when run on full capacity.

Assuming this is the industry average for efficiency…

Can Gurel


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