THORChain Generates Nearly $1 Billion in Volume in 7 Days

THORChain contributors have traced a $10.7M vault compromise to a newly churned node that entered the network days before the attack. Investigators believe a single malicious actor exploited a vulnerability in the GG20 TSS implementation, allowing vault key material to leak over time until the attacker could reconstruct the private key. **Current Network Status:** - Network paused by node operators - RUNE transfers and chain observation may resume within 12 hours - Trading, LP actions, and signing remain paused pending recovery plan - User funds appear unaffected; only protocol-owned funds lost **Recovery Options Under Discussion:** - Slashing bonds of affected vault nodes - Using Protocol-Owned Liquidity (POL) to absorb losses - Community-driven alternative proposals The Treasury is working with Outrider Analytics and law enforcement to identify the attacker and recover funds. Full network functionality restoration will likely take several days as the community aligns on a remediation approach.

THORChain has deployed version 3.18, a significant protocol upgrade containing 51 merged improvements. **Key Updates:** - **POL foundations** - New protocol-owned liquidity infrastructure - **Dynamic fee architecture** - Adaptive fee system implementation - **New asset groundwork** - Technical preparation for Monero, TAO, and Polkadot integration - **Security enhancements** - Major solvency protections and infrastructure hardening This follows the v3.17.0 release from April, which included over 100 improvements to security, swaps, and cross-chain functionality. Full technical details: [THORChain Blog](https://blog.thorchain.org/thorchain-protocol-upgrade-v3-18/)

**Independent Verification Over Shared Trust** Most DeFi protocols rely on shared RPCs (Remote Procedure Calls) to read blockchain data. If that RPC serves incorrect information, every system downstream—oracles, bots, dashboards—acts on false data. **THORChain's Approach** - Each THORNode runs its own full node for every supported chain - No shared RPC infrastructure - No third-party intermediaries for Bitcoin or Ethereum state - Consensus only occurs when independent nodes agree on chain state **Why It Matters** This design separates protocols that independently verify truth from those that trust external sources. THORNodes cooperate to enable cross-chain swaps, but that cooperation is built on independent verification rather than shared assumptions. The architecture prevents systemic failures that audits cannot catch.

THORChain has completed a burn of 64.4 million $RUNE tokens, reducing the total supply to 360 million—down from 1 billion at launch. The burn brings the market cap to fully diluted valuation (MC/FDV) ratio to 97%, with circulating supply now within 3% of total supply. **Key Details:** - Total supply decreased from 500M to 360M following ADR023 approval - 5% of all protocol fees continue burning tokens daily - $RUNE operates as a deflationary token by design - Analytics sites still show 500M max supply, but nodes will vote to update the MAXRUNESUPPLY setting to 360M once alignment is complete The burn came from the Reserve using system income. More data available at [Dune Analytics](https://dune.com/thorchain/thorchain-overview).

**Bridges don't actually move your assets** - they lock them in vaults and issue wrapped tokens as IOUs. When you bridge ETH to Solana, your real ETH sits locked while you receive a synthetic token representing a promise to unlock it later. **This architecture creates a critical vulnerability**: the system must maintain perfect synchronization between locked assets and minted synthetics. Major exploits include: - Wormhole: $320M lost - Ronin: $600M lost - Nomad: $190M lost **THORChain uses a different approach** with atomic swaps. When swapping ETH for SOL, your Ethereum enters a threshold-signature vault while native Solana from a separate vault goes to your address. No wrapped tokens exist. **Key differences**: - Bridge hack → your wrapped tokens become worthless - Atomic swap → transaction either completes or refunds, no synthetic tokens at risk **The tradeoff**: Native swaps are slower and more expensive than bridges, but eliminate the failure mode where users discover their wrapped tokens have no backing. With atomic swaps, you never hold someone else's promise.