This is my entry for November 25th in the Steemitblog Contest: My favorite Cryptocurrency.

Thorchain Blockchain Native Token Rune

What is it?

THORChain is an computer code application which creates a network allowing what are called atomic swaps between cryptocurrency tokens from different blockchains. This is called Cross-Chain trading.

Why is this important?

This is important, because most cryptocurrency tokens have to be purchased on exchange. To buy cryptocurrency you normally need to go to the exchange web page, open an account, deposit dollars or your local currency, buy Bitcoin, then trade Bitcoin for the cryptocurrency you want. This Trading of Bitcoin for your desired cryptocurrency is also called an exchange or a Swap. Sometimes a cryptocurrency you want is not tradeable for Bitcoin. This means there is no Trading Pair. But there is another trading pair between your desired coin and another cryptocurrency like Ethereum. In this case you would navigate to the exchange webpage, open an account, deposit dollars to buy bitcoin, trade or swap Bitcoin for Ethereum, and then trade or swap Ethereum for your desired coin. As you can see it is sometimes complicated to trade or swap cryptocurrencies.

Atomic Swaps

One way of simplifying this process involves eliminating the need for the exchange, and eliminating the need to trade for several different coins to find a trading pair for your desired coin. It is called an atomic swap. In an atomic swap you trade your cryptocurrency for the one you want in one step. When you perform an atomic swap you trade one token for another without using an exchange. IN an Atomic Swap you trade directly from your wallet to the wallet of the other person's wallet for the cryptocurrency you want. This other person is called your peer, and you are called their peer, and this type of trading is sometimes called Peer to Peer or Peer-Peer. This is popular because it eliminates several steps in obtaining your desired cryptocurrency, and because your cryptocurrency stays in your wallet until it's time to trade, it's more secure then sending currency from your wallet to an exchange wallet, then moving it from one exchange wallet to another and then trading it and receiving the desired cryptocurrency in yet another exchange wallet before finally transferring it to your wallet.

Speculation

Investors interested in this technology should buy the Rune coin, which is the native token of Thorchain. It has appreciated in value this year due to interest in owning it, as a means to profit from the anticipated widespread use of the Thorchain network, which is anticipated to happen in the coming year. This is clearly a speculative investment in a project whose product is not finished and for whom a market is projected to exist, but does not yet exist. It is theoretical utility and should be viewed carefully from that perspective.

Additional Income Source

There are other ways to benefit from owning Thorchain Rune. The Thorchain network requires “Nodes”, these are computers with copies of the Thorchain network software. They monitor the cryptocurrency blockchains around the and the atomic swaps occurring between them for honesty and accuracy, there are also specialized nodes which defend the Thorchain network from cyberattacks. The people who want to run these nodes buy a certain amount of Rune, they deposit it in an interest bearing account, through a process called staking. They download special software to their computers and the software does the work of protecting the network.

Conclusion

I think Thorchain is an interesting investment. I suggest you read my other articles about Atomic Swaps to increase your understanding.

@shortsegments