How does THORChain work?

THORChain is a decentralized liquidity protocol that enables users to swap digital assets in a trustless and secure manner.

It is built on the Cosmos Network, which is a blockchain interoperability platform. At its core, THORChain uses a network of validators to ensure that all transactions are secure and valid. The validators are responsible for verifying transactions and ensuring that they are legitimate.

They also help to maintain the network’s security by providing consensus on the state of the blockchain. The THORChain protocol also uses a system of smart contracts to facilitate asset swaps between users. These smart contracts are used to create liquidity pools, which allow users to exchange assets without having to trust each other or rely on third-party services.

The smart contracts also enable users to earn rewards for providing liquidity in these pools. In addition, THORChain uses a native token called RUNE, which is used as an incentive for validators and as a way for users to pay transaction fees. RUNE can also be used as collateral in order to borrow other assets from the network’s liquidity pools.

Overall, THORChain provides an efficient and secure way for users to swap digital assets without having to trust each other or rely on third-party services. It is designed with scalability in mind and can be used by both individuals and businesses alike.