RUNE Price Forms Giant Bearish Flag as THORChain Swap Volume Surges

THORChain’s native token, RUNE, has been under significant pressure, as it forms a giant bearish flag pattern, indicating potential further downside. Despite recent surges in swap volume and network activity, the price of RUNE has plummeted, showing an 82% drop from its peak in November 2024. As of the latest trading data, RUNE is hovering around $1.3050, a level not seen since November 2023, and remains a staggering 90% below its all-time high.

The drop in RUNE’s price comes even as the THORChain network recorded its best week in terms of swap volume, with a surge of 640% over the past seven days, reaching $3.3 billion. This jump in trading volume has made THORChain the sixth-largest player in the decentralized exchange (DEX) industry. Additionally, the network saw a dramatic increase in weekly active addresses, which nearly quintupled to 5,000, up from just 1,000 earlier in the month.

However, this surge in activity is not entirely organic. Data from Arkham Intelligence suggests that much of the increased swap volume is linked to the recent hack of Bybit, a major cryptocurrency exchange. The Lazarus Group, a North Korean hacking group, is reported to have transferred over $240 million worth of stolen Ethereum through THORChain as part of its money-laundering operation, converting the Ethereum into Bitcoin. This has led to increased scrutiny on the network, as it faces potential legal and regulatory challenges related to the handling of illicit transactions.

Furthermore, THORChain is still dealing with significant internal challenges. Earlier this year, the network paused Ethereum and Bitcoin lending after its liabilities exceeded $200 million. The platform also experienced a blow to its leadership, with Pluto, a core developer, resigning after a vote to block the North Korean-linked transactions failed. The resignation is likely to further destabilize the platform, especially as it faces the possibility of an investigation by U.S. authorities, including the FBI.

From a technical standpoint, RUNE’s price action suggests that the token may face further downside. The weekly chart reveals that RUNE has been in a steep downtrend since reaching a high of $7.50 in December. This decline followed the formation of a head-and-shoulders pattern, which is typically a bearish reversal signal. RUNE has now fallen below both the 50-week and 25-week Exponential Moving Averages, key indicators of trend strength, as well as the critical support level at $2.5560, which was the lowest swing from September 2023.

Currently, RUNE is forming a bearish flag pattern, a continuation signal that suggests further declines. If the price drops below the key support level of $0.7790, which marks the lowest point of 2023, the bearish outlook would likely be confirmed, potentially triggering a more significant breakdown.

In conclusion, despite a surge in swap volume and network activity, RUNE’s price is under significant threat from both internal issues and external factors like the Lazarus Group’s involvement. With a bearish flag pattern forming and key support levels at risk, the token could face further declines in the near future, especially if it fails to maintain the critical support at $0.7790. Investors and traders will need to watch these levels closely for any signs of further breakdown or stabilization in the coming weeks.