Don’t Get RUNE’D

Market Meditations | July 20, 2022

Several months ago, the operators of THORChain discovered that the RUNE tokens on the Ethereum and Binance Chains were vulnerable to exploits. Monday, the anonymous team announced that they would discontinue the RUNE token on both chains.

  • THORChain is a cross chain dex that uses the native RUNE token for swapping other native assets. If you missed our intro, check it out here.
  • The RUNE token was issued on the Ethereum Chain and the Binance Chain 18 months prior to the mainnet launch to give users time to acquire enough RUNE tokens to launch a node.
  • The RUNE token on the Ethereum chain has an error on the transfer function that allows users to be phished. Unfortunately, this makes holding the Ethereum version “unfavorable for long-term holders.”
  • A critical vulnerability in RUNE and the mint function on the Binance Chain was found by a white hat exploiter but reported before damage occurred.
  • Because of these issues, operators plan to create a ‘kill switch’ for the two chains. Once activated, it will slowly reduce the redemption rate over a 12-month period. Afterward, you will no longer be able to redeem either version for the native asset.

Crypto is not a market where a ‘set it and forget it’ mentality works. Aside from the volatility, projects are occasionally abandoned or exploited, making it important to stay up to date on projects.