- THORChain node operators have approved a restructuring plan that converts approximately $200 million in liabilities into equity-style tokens.
- The restructuring aims to stabilize THORChain’s operations by addressing its outstanding obligations and restoring user confidence.
- THORChain’s native token, RUNE, rose 13.7% after the announcement, though it remains substantially lower than a month ago.
Node operators within the THORChain network have voted to implement a restructuring proposal that transforms roughly $200 million of the protocol’s debt into newly issued equity tokens. The plan is intended to give creditors a stake in the protocol’s future revenue and to reduce the immediate financial strain on THORChain’s operations.
The proposal—known as “Proposal6”—was developed after THORChain paused its lending and savers programs on January 23 amid community concerns over the risks introduced by the ThorFi feature. At the time of the pause, the protocol had accumulated about $200 million in liabilities. The suspension triggered a contraction in network participation: 31 validators departed, around $100 million in liquidity left the system, and the RUNE token saw a sharp price decline. Despite these setbacks, THORChain maintained core operations, highlighting the network’s resilience.
The approved restructuring plan
Drafted by Aaluxx Myth of Maya Protocol and put to a vote by node operators, the approved plan calls for minting 200 million new tokens called “TCY,” each representing one dollar of the platform’s outstanding obligations. These tokens will be airdropped to address holders affected by the lending and savers program suspensions.
TCY tokens are structured to receive 10% of THORChain’s network revenue in perpetuity, paid in RUNE. This design gives TCY holders an ongoing income stream similar to dividends, aligning creditor recovery with future protocol performance.
To support market liquidity for TCY tokens, THORChain’s treasury will seed a liquidity pool so holders can convert their equity tokens into other assets as market demand dictates. The goal is to provide creditors with flexibility: they can retain revenue exposure or exit as the market values THORChain’s revenue-generating potential.
With the vote complete, implementation is now being handled by THORChain’s development teams, including contributors from Nine Realms Capital, Maya Protocol, Rujira Network, and Strangelove Labs. These teams are responsible for delivering an orderly rollout; specific timelines and technical details are still being finalized.
Community response has been mixed. Some members view the plan as a pragmatic path to recovery that preserves the protocol’s long-term value. Others raise concerns about the complexity of the new token mechanics, the potential for operational or market risks during the transition, and possible legal questions about whether the TCY tokens could be interpreted as securities in some jurisdictions.
Market reaction for THORChain (RUNE)
News of the restructuring produced a short-term bullish response for RUNE, which climbed 13.7% in the immediate aftermath and was trading near $1.38 on the most recent data. That increase, however, follows a severe downtrend: RUNE has fallen 37.8% over the past week, 58.2% over two weeks, and 72.7% over the past month. The contrast indicates that while the restructuring announcement offered some reassurance, broader market pressures and lingering uncertainty about THORChain’s recovery continue to influence investor sentiment.
Overall, the approved plan represents a significant shift in how THORChain intends to resolve its liabilities—converting debt into a revenue-linked token that aligns creditor recovery with ongoing network performance. The success of the approach will depend on careful technical execution, transparent communication from the development teams, and market confidence as the new token economics take effect.