The bonfire passed through THORChain and burned 60 million tokens

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The THORChain network’s native cryptocurrency, RUNE, has seen a significant 109% increase in price over the past week.

This growth has led to RUNE, which Just seven days ago it was trading at $5, reaching $11 todaythus becoming the cryptocurrency with the highest rise in the last week, as seen in the following TradingView chart.

The rally in price comes after a period of sideways trading that spanned from February to early March.

However, the main catalyst behind this increase has been a series of actions undertaken by the team behind the development of the THORChain protocol.

On March 5, the protocol reported burning 60 million RUNE tokens as part of an effort to increase its lending capacity by $100 million. This measure—by a simple law of supply and demand—had an immediate impact on the price of the crypto asset, driving it up.

Likewise, it also had an impact on the total value locked of THORChain, which has experienced a significant increase, going from $346 million to $537 million since the initiative was announced, according to data from DefiLlama.

The lending protocol, known as THORFi Lending, offers users the ability to borrow bitcoin (BTC) and ether (ETH) without incurring interest and was launched in August 2023, as reported by CriptoNoticias.

When a user applies for a loan on the platform, the collateral provided is converted into a new asset called TOR, while the difference between the value of the collateral and the loan amount is burned, thus reducing the total amount of tokens in circulation.

Additionally, an update of the protocol version was carried out, going from 1.127.2 to 1.128.0, which It allows more “loan space available”. This implies that a reduction in collateral rates for BTC and ETH to 200%meaning users can now borrow up to half the value of their assets.

The THORChain team believes that this move “will open up more loans since the conditions are favorable.”

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