Introduction

After Kujira’s most recent setback, Thorchain has stepped in to secure a more promising outlook for both parties. This has led to the formation of the Rujira Alliance, a Merger that seeks to overcome risk assessment mistakes of the past while leveraging the strengths of Kujira to enhance Thorchain’s value proposition with smart contract capabilities. This not only provides a chance to recover and expand Kujira’s mission, but also addresses Thorchain’s need to offer more advanced financial services beyond cross-chain-swap and overcome the current limitations of the network.

The following report will examine the key stages of the path that led to the merger, the medium and long term objectives, and the potential upside to be had by being exposed to one of the most interesting partnerships of the year.

Background

To understand the significance of this Merger, it is imperative to understand the circumstances that led to the actual development of each protocol individually.

Kujira

Kujira’s origins date back to May 2021, with the $KUJI Token Generation Event taking place in November of that same year. The origins of the vision date back to the early days of the Terra Ecosystem, when they witnessed howMonths later, a liquidation cascade on the Anchor Protocol in Terra triggered a significant price drop on $LUNA. This event highlighted vulnerabilities in the DeFi space, where a small group of market participants was able to purchase liquidated assets at steep discounts. In response to these market inefficiencies, the Kujira team began developing a platform to decentralize the liquidation bidding process, Orca.

Orca was the first product built by Kujira, and it was deployed on top of the Terra blockchain. This protocol would allow users to bid on defaulted loans—a process traditionally limited to institutional-grade investors. By democratizing access to liquidation markets, Orca addressed a key gap in DeFi and created a foundation for a community of users focused on a more inclusive financial ecosystem.