THORChain Announces TCY Token to Convert $200M Debt into Equity

THORChain is facing a significant financial challenge with nearly $200 million in debt. To address this crisis, the THORChain governance body has approved a proposal to convert the defaulted debt into equity by issuing a new token called TCY.

THORChain has announced a significant financial challenge with nearly $200 million in debt. To address this crisis, the THORChain governance body has approved a proposal to convert the defaulted debt into equity by issuing a new token called TCY. This innovative approach aims to stabilize the protocol’s financial situation and provide a path forward for creditors.

The TCY token will be issued to creditors at a rate of 1 TCY per dollar of defaulted debt, with a total supply of 200 million tokens. Holders of TCY tokens will be entitled to 10% of THORChain’s revenue in perpetuity, effectively turning their debt claims into equity within the THORChain ecosystem.

This move is designed to provide creditors with a stake in the protocol’s future success, aligning their interests with the long-term growth of THORChain.

The implementation of the TCY token involves several key steps. First, the THORChain team will create a RUNE/TCY liquidity pool with $500,000 liquidity at $0.1 per TCY, funded by $5 million from the treasury.

This liquidity pool will facilitate trading and provide initial support for the TCY token’s value. Additionally, the protocol has suspended its THORFi services, including “Savers and Lending” programs, to focus on restructuring and addressing the debt crisis.

Despite the announcement of the restructuring efforts, THORChain’s native token, RUNE, has experienced significant price volatility. Over the past week, RUNE’s price has dropped by 35%, falling from $2 to $1.3.

This decline reflects broader market concerns and the challenges faced by the protocol. However, THORChain has maintained swap volume, processing $270 million in the last 24 hours, indicating continued user engagement and activity.