RUNE, the native token of cross-chain decentralized exchange THORChain, is currently one of the best-performing cryptocurrencies on the market, boasting a 31.5% price increase over the past 24 hours.
Based on Coingecko data, this price rise only confirms RUNE’s notable bullish form in the past few weeks, with the token up 115.0% and 212.3% on the 14-day and 30-day chart respectively.
Interestingly, this continued upward pressure in the RUNE market has seen the DeFi coin reach a new yearly high of $5.31 and a peak daily trading volume of $1.28 billion.
Behind Thorshin (rune) rises
In analyzing RUNE’s rapid rise in the past few weeks, many analysts gave credit to the newly introduced features on the THORChain platform.
For context, in the THORChain Ecosystem Report Q3 2023, the DEX development team announced the implementation of new features such as lending, flow swaps, flow loans, and savings for stablecoins, among others.
In X’s post on Saturday, a cryptocurrency analyst with the username The Wolf of DeFi offered some thoughts on how one of these features could push RUNE to new heights. the The analyst attributed most of RUNE’s gains to the Broadcast Swaps feature, which is designed to allow large swap requests to be automatically split into smaller requests that are processed over time.
rune $ He continues to achieve new highs. The reason for this is the fluidity flywheel. I’ll show you how it works and why it will pay rune $ Much higher. @THORChain Built on liquidity pools. Since the infrastructure is used for swaps, liquidity providers make money. Underlying assets…
— The Wolf of Defi ⭕️ (@thewolfofdefi) November 11, 2023
The Wolf of DeFi explains that the introduction of this update has increased the platform’s swap volume and annual percentage rates (APRs) offered to liquidity providers.
As expected, higher APRs will attract more liquidity providers who will have to invest in RUNE, which serves as the underlying asset for every liquidity pool on THORChain, creating a cycle called a liquidity flywheel.
Furthermore, The Wolf of DeFi stated that every dollar worth of non-RUNE assets deposited into THORChain’s liquidity pool is matched with its RUNE equivalent by network nodes.
Thus, if an LP deposits $100 consisting of $50 BTC and $50 RUNE in BTC/RUNE, the nodes will balance this transaction with an additional 50 RUNE, increasing the buying pressure in the market, allowing the token to maintain its trajectory. Ascending.
RUNE price prediction
Looking at the daily chart of RUNE, the Relative Strength Index (RSI) stands at 87.24, indicating that the token is in the overbought zone. Therefore, investors are advised to be alert for a possible decline in prices.
On the other hand, RUNE may continue to maintain its bullish momentum, especially as the team behind THORChain looks to offer more attractive features, including order book trading.
At the time of writing, RUNE is currently valued at $5.10, with a 3.2% gain in the past hour. Meanwhile, the token’s market cap is $1.58 billion, allowing it to rank as the 41st largest cryptocurrency on the market.
RUNE trading at $5.109 on the daily chart | Source: RUNEUSDT chart on Tradingview.com
Featured image from iStock, chart from Tradingview