THORChain to Launch Equity Tokens as a Strategy to Tackle $200M Debt After Halting Bitcoin and Ether Lending

THORChain to Issue TCY Tokens in Effort to Convert $200M Debt into Equity

THORChain has approved “Proposal6,” a plan to tackle its nearly $200 million debt by converting it into equity through the issuance of a new token, TCY (Thorchain Yield). With a total supply of 200 million tokens, TCY will be distributed on a 1:1 ratio to the dollar value of defaulted debt, turning affected lenders and savers into equity stakeholders.

This action follows the suspension of THORFi services on January 23 due to ongoing financial uncertainties, as reported by CoinDesk.

In addition to debt conversion, THORChain will establish a RUNE/TCY liquidity pool, initially funded with $500,000 at $0.1 per TCY token, using $5 million from the treasury.

TCY token holders will be entitled to receive 10% of THORChain’s revenue on a continual basis, offering a potential long-term recovery mechanism for those impacted by the debt issue. However, the exact timeline for a full financial recovery remains unclear.

Despite these challenges, THORChain’s key cross-chain swap services remain unaffected. Meanwhile, the price of the platform’s native token, RUNE, has experienced a 10% drop in the last 24 hours, further extending the 30-day loss to nearly 50%, reflecting broader market trends.