In the first quarter of 2025, the price of RUNE experienced a significant drop, which triggered a decline in the total value locked (TVL) within the THORChain ecosystem.
RUNE Price Plunge and TVL Decline
The drop in RUNE's value by 60% led to a decrease in THORChain's DeFi TVL from $329 million to $127 million. While the price decline affected the protocol's liquidity, native asset deposits like BTC and ETH surged, indicating confidence in the infrastructure. A THORChain Core Contributor noted, “Liquidity on the network decreased from $329 million to $127 million, while liquidity providers earned $14.41 million in fees, with 91.36% of earnings derived from swap fees and 8.64% from block rewards.”
Swap Volume Hits $20 Billion
Despite the drop in TVL, a total swap volume of $20 billion demonstrates ongoing user engagement with the THORChain network. According to a THORChain Community Steward, “Despite the USD value slump in TVL, the protocol processed nearly $20 billion in swap volume for the quarter, with BTC, ETH, and RUNE being the most transacted assets.”
Historical Trends and Potential Recovery
Previous instances, such as in Q2 2024, demonstrated similar TVL contractions due to market volatility, yet usage and swap volumes rebounded following stabilization periods. Expert analysis suggests that THORChain's core protocol usage and volumes are robust against RUNE price fluctuations, indicating potential recovery as market conditions stabilize.
The decline in RUNE value significantly impacted THORChain's TVL; however, active deposits and high swap volumes suggest steady user interest in the platform.
