What is THORChain?

Thorchain is a decentralized liquidity protocol that enables the exchange of digital assets across different blockchain networks without relying on centralized intermediaries. It functions as a cross-chain automated market maker (AMM), allowing users to swap assets like Bitcoin, Ethereum, and other supported cryptocurrencies in a permissionless manner. Thorchain uses liquidity pools funded by users, who earn fees for providing liquidity, ensuring that trades can be executed efficiently across various blockchain networks.

The protocol employs a native cryptocurrency called RUNE, which plays a central role in maintaining security, liquidity, and governance within the system. RUNE acts as a bridge between different assets, ensuring that trades can occur seamlessly between blockchains. Thorchain's decentralized structure means it operates without a single point of control, relying instead on a network of validators to secure transactions.

What is RUNE?

RUNE is the native asset of the Thorchain protocol, serving multiple purposes within the network. It functions as a settlement asset, providing liquidity and acting as a bridge between different cryptocurrencies during swaps. RUNE is also used as a staking asset by validators to secure the network, and it facilitates governance decisions within the protocol. The total supply of RUNE is capped at 500 million, with a portion allocated to liquidity providers, validators, and the community to incentivize participation and maintain the protocol's operations.

Risk Statement

Before trading any crypto assets it is important to understand the risks. This overview is a starting point for you to perform your own research prior to investing in a crypto asset.

No securities regulatory authority or regulator in Canada has evaluated or endorsed the Crypto Contracts or any of the crypto assets made available through the platform.

Wealthsimple has performed an assessment of whether RUNE can be supported by Wealthsimple's platform, including whether RUNE is a security and/or a derivative and is being offered in compliance with securities and derivatives laws.

We evaluated RUNE based on publicly available information, including (but not limited to):

• The creation, governance, usage and design of RUNE, including the source code, security and roadmap for growth in the developer community and, if applicable, the background of the developer(s) that first created RUNE;
• The supply, demand, maturity, utility and liquidity of RUNE;
• Material technical risks associated with RUNE, including any code defects, security breaches and other threats concerning RUNE and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them;
• Legal and regulatory risks associated with RUNE, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of RUNE; and
• Statements made by regulators or securities regulatory authorities in Canada and other jurisdiction regarding whether RUNE, or generally about whether the type of crypto asset, is a security and/or a derivative.

Wealthsimple monitors ongoing developments related to crypto assets available on its platform for significant changes that may affect Wealthsimple's original assessment of those assets, including Wealthsimple's assessment of the application of securities and derivatives laws. Any significant changes relating to RUNE may result in changes to this Crypto Asset Statement and/or Wealthsimple's ability to support RUNE.

Like all other crypto assets, there are some general risks to investing in RUNE. These include short history risk, volatility risk, liquidity risk, demand risk, forking risk, cryptography risk, regulatory risk, concentration risk, electronic trading risk and cyber security risk. Please review the Wealthsimple Crypto Product Risk Disclosure for additional discussion of general risks associated with the crypto assets made available through the platform.

Additional Risks/Information

Thorchain has faced security incidents in the past that highlight potential risks associated with holding RUNE or using the protocol. In July 2021, Thorchain suffered an exploit that resulted in a loss of approximately $5 million worth of assets due to a vulnerability in its Ethereum router. Shortly after, in August 2021, another attack occurred, exploiting a bug in the protocol's code, leading to a further loss of about $8 million. These incidents prompted Thorchain to halt operations temporarily while developers addressed the vulnerabilities and implemented security upgrades. The network resumed with enhanced protections, including audits and additional security measures, however future incidents could potentially impact RUNE's price.

In January 2025, THORChain developers temporarily suspended THORFi services—including Lending, Savers vaults, and synthetic asset withdrawals—after identifying a significant imbalance between protocol assets and liabilities, raising concerns about potential insolvency. While the core THORChain network remained functional and secure, the incident revealed risks in applications built on top of it, highlighting how protocol-level design flaws or financial stress in associated products can still adversely impact the broader ecosystem and the price of the RUNE token.

We emphasize that this Crypto Asset Statement is not exhaustive of all risks associated with trading RUNE. Investors should perform their own assessment to determine the appropriate level of risk for their personal circumstances.

Wealthsimple is offering Crypto Contracts in reliance on a prospectus exemption contained in the exemptive relief decision Re Wealthsimple Investments Inc. dated December 18, 2023 (the Decision).

The statutory rights of action for damages and rescission in section 130.1 of the Securities Act (Ontario), and, if applicable, similar statutory rights under securities legislation of other jurisdictions of Canada, do not apply in respect of this Crypto Asset Statement to the extent a Crypto Contract is distributed under the prospectus relief in the Decision.

Last Updated: August 1, 2025