Thorchain, a DeFi protocol enabling cross-chain asset swaps, is currently facing a significant financial crisis, reporting a $200 million insolvency. The protocol recently paused its savers and lending programs, preventing users from withdrawing assets. Approximately $111 million in digital assets is held within Thorchain, but ongoing redemptions have left the protocol unable to meet its obligations. The freeze allows for a potential restructuring plan, giving the community 90 days to address the issues. Thorchain's native asset, RUNE, has been affected, with its supply inflating amid these challenges, pushing its price down by 29%. Despite the turmoil, some community members advocate for Thorchain's value, highlighting its $47 million in lifetime fees. As discussions on the future of the protocol unfold, there is a dominant concern over the sustainability of its liquidity operations and the impact of recent user redemptions.

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