Synthetix (SNX)
A Protocol For Trading Synthetic Assets On Ethereum.- Synthetix is an Ethereum-based protocol for issuing and trading synthetic assets, including cryptocurrencies, leveraged tokens, equities, and other real-world assets.
- Traders and other market participants can gain on-chain exposure to a variety of assets without slippage on the Synthetix exchange.
- SNX tokens are used to earn exchange fees for collateralizing the protocol. SNX tokens can be staked on Mintr. In addition, network statistics are open to public.
- In the Synthetix protocol, collateralized assets are combined together to act as a counterparty debt pool to all minted assets (e.g., synthetic assets like sUSD and sBTC). It allows users to trade synthetic assets directly without the need for direct counterparties while solving liquidity and slippage issues.
- As of July 9th 2020, Synthetix is one of the largest DeFi protocols on Ethereum based on total net asset locked value; its on-chain collateral is worth more than $350 million.
Key metrics (as of July 9th 2020)
| Ticker | SNX |
|---|---|
| Price | 2.66 USD |
| 24h Volume | 9.68MM USD |
| Market Cap | 269.54MM USD |
| Current Circulating Supply | 101,331,737 SNX |
| Current Total Supply | 192,065,848 SNX |
| Max Supply | 259,562,746 SNX |
1. What is Synthetix (SNX)?
Synthetix is a protocol for issuing and trading synthetic assets (Synths) on the Ethereum blockchain.
Each Synth is an ERC-20 token that tracks the price of an external asset. For example, each sUSD token tracks the price of the US dollar while sBTC tracks the price of BTC.
In principle, the system can support any asset with a clear price and provides on-chain exposure to an unlimited range of real-world assets.
Synths are collateralized with the Synthetix Network Token (SNX). The platform utilizes a pooled collateral model that enables users to perform conversions between Synths directly with the smart contract, avoiding counterparty risks as well as liquidity and slippage issues experienced by many decentralized exchanges (DEXs).
Synthetix currently supports synthetic fiat currencies, cryptocurrencies (long and short), commodities, and equities.
Recent news
- June 2020: it announced the implementation of Liquidation Module and Differential Fees.
- May 2020: the team announced L2 trading competition and Core contributor escrow.
- April 2020: Synthetix announced sUSD liquidity pool on Curve, sAUD payments with RelayPay and iETH incentive.
- March 2020: Index Synths were deployed and annoucement of Improved Delegation Powers.
- Feburary 2020: it released Synthetix.Exchange v2, implemented Ether collateral and launched GrantsDAO.
2. Existing products
2.1 Synthetix.Exchange
Synthetix.Exchange is a trading dApp that leverages the Synthetix protocol and demonstrates its primary use-case: trading between synthetic assets.
Source: Synthetix Management Team.
2.2 Mintr
Mintr allows SNX stakers to mint and burn Synths to manage their collateralization ratio, to claim staking rewards, to track any fluctuations in their debt, and to perform various other actions on the network.
Source: Synthetix Management Team.
2.3 Dashboard
The Synthetix dashboard is a public interface providing insight into various system metrics, including statistics relating to trading volume, staking, open interest in Synths, and more.
3. Technical infrastructure
Synthetix is a protocol for issuing and trading synthetic assets on Ethereum. These synthetic assets are collateralized by the Synthetix Network Token (SNX), which when locked in a staking contract, enables the issuance of synthetic assets (Synths).
Each synthetic asset (or Synth) is an ERC-20 token that tracks the price of an external asset; for example, each sUSD token tracks the price of the US dollar. A wide variety of Synths can be issued, including fiat currencies, cryptocurrencies, commodities, and inverse indexes.
In principle, the system can support any asset with a consensus price available via an external oracle, providing on-chain exposure to an unlimited range of real-world assets.
Synthetix is otherwise composed of a smart contract infrastructure and a set of incentives which maintains Synth prices. It is underpinned by the value of the Synthetix Network Token (SNX). SNX acts as collateral; staking a proportional value of SNX is required to mint Synths.
Stakers are rewarded for supporting the system with a pro-rata share of the fees generated by activity in the system. The value of SNX is thus directly connected with the usage of the network activities.
This mechanism allows Synthetix to support instantaneous, near-frictionless conversion between different types of Synths without the liquidity and slippage issues experienced by other decentralized exchanges.
Features such as no orderbooks and zero slippage are possible because Synth trading profits/losses are split across the pooled debt SNX stakers incur when they mint Synths. SNX stakers act as a pooled counterparty to all Synth exchanges; stakers take on the risk of the overall debt in the system. They have the option of hedging this risk by taking positions external to the system. In return, SNX stakers earn a right to fees generated by the system.
4. Token sales and economics
4.1 Token sales data
| Ticker | SNX |
|---|---|
| Pre-Sale Price | 0.2700 USD / SNX |
| Pre-Sale Date | January - Feburary 2018 |
| Pre-Sale Allocation | 2,251,471 SNX |
| Pre-Sale Funds Raised | 0.61MM USD |
| Private Sale Price | 0.4700 USD / SNX |
| Private Sale Date | January - Feburary 2018 |
| Private Sale Allocation | 49,835,678 SNX |
| Private Sale Funds Raised | 23.42MM USD |
| Public Sale Price | 0.6700 USD / SNX |
| Public Sale Date | Feburary 2018 |
| Public Sale Allocation | 7,912,851 SNX |
| Public Sale Funds Raised | 5.30MM USD |
4.2 Token allocations
SNX has a max supply of 259,562,746 tokens. As staking rewards in SNX will be released forever at a decreasing rate, the SNX token allocations will approach the following percentages asymptotically.
| Ticker | SNX |
|---|---|
| Pre-Sale | 0.87% of the total token supply |
| Private Sale | 19.20% of the total token supply |
| Public Sale | 3.05% of the total token supply |
| Team | 18.49% of the total token supply |
| Advisors | 0.77% of the total token supply |
| Foundation | 4.62% of the total token supply |
| Partnership Incentives | 1.93% of the total token supply |
| Bounties/Airdrop | 1.16% of the total token supply |
| Staking | 49.92% of the total token supply |
SNX token allocation (%)
SNX token release schedule
5. Project team
6. Roadmap, updates, and business development
6.1 Original roadmap and achievements
| Planned Date | Milestone | Actual Date | Timing | Comments |
|---|---|---|---|---|
| 2018: Q1 | HAV token release (now called SNX) | 2018: Q1 | On Time | Medium |
| 2018: Q2 | nUSD token release (now called sUSD) | 2018: Q2 | On Time | Whitepaper |
| 2018: Q4 | Multicurrency Nomins (now called Synths) | 2018: Q4 | On Time | Medium |
6.2 Updated roadmap
2020 Q1
- Launch of Ethereum collateral (Phase 1).
- Launch of Synthetix.Exchange V2.
- Release of new crypto Synths.
- Launch of Wallet Delegation.
- Release of Synthetix.Exchange interface enhancements. (Gypsum,Bauxite,Halite).
- Completion of Phase 0 and Phase 1 of ProtocolDAO.
2020 Q2
- Release of Equity Index Synths such as sNIKKEI and sFTSE.
- Release of Differential Fees.
- Launch of Liquidation Mechanism.
- Release of Leveraged Synths.
- Release of advanced order types.
- Release of trading incentives update.
2020 Q3
- Release of binary options.
- Release of Synthetic Futures products.
- Integration with Chainlink for on-chain price feeds.
- Implementing new escrow contract.
2020 Q4
- Launch of Optimistic Layer 2.
6.3 Commercial partnerships and business development progress
- Chainlink: Chainlink is a decentralized oracle service provider; Synthetix is integrating with Chainlink to receive price feeds on different assets.
- Optimism: Optimism is building a layer 2 scaling solution on Ethereum; Synthetix is implementing the Optimistic Virtual Machine to increase network throughput.
- Curve: Curve is a DeFi platform that introduces Automated Market Making Pools; sUSD became one of the few stablecoins Curve supports.
- Gnosis: Gnosis is a decentralized exchange protocol; the partnership allowed continuous auctions of escrowed SNX to generate ETH for the Synthetix platform.
- Thorchain: Thorchain is a cross-chain liquidity protocol; this partnership enabled SNX holders to stake SNX and access pairings to all other supported assets on all other chains.
- RelayPay: RelayPay is an Australian crypto-fiat gateway; The partnership between Synthetix and RelayPay will add support for sAUD.
- FractalWealth: Fractal is a decentralized liquidity provider; Fractal provides liquidity for Synthetix-related assets accross 0x and Matcha markets.
7. Synthetix's activity and community overview
7.1 Social activity
The Synthetix community growth strategy consists of fostering active participation in the decision making behind development of Synthetix products, encouraging community involvement and direct engagement through informative content using social media platforms such as Twitter and Discord.
Current community growth strategies of Synthetix include:
- Hosting community governance polls in Discord.
- Conducting monthly public governance update meetings to inform the community on product delivery and short-term focuses.
- Setting up the grantDAO Program to fund community proposals.
- Running local community manager programs in all countries with language support.
- Collaborating with library associations and educational institutions to attract editors.
Future community growth strategies of Synthetix include:
- Launching the Synthetix Ambassador Program to incentivize Synthetix supporters to continue their efforts of promoting Synthetix.
- Fostering a Korean community with SNX listing on Korean exchanges and Korean translations to the litepaper and dApps.
- Launching the Product Feedback Program to create dialogue between the Synthetix core contributors and users.
Community and social channels (data as of July 9th 2020)
Twitter (English) | 21.7K Followers
Discord (Main) | 10.0K Members
Discord (Exchange) | 217 Members
Reddit (English) | 1.5K Members
Facebook (English) | 2.5K likes
Blog
7.2 Development activity
7.3 On-chain activity
8. Appendix
A more descriptive overview of the system is available in the Synthetix Litepaper, and the explainers on SNX staking rewards, Synthetix.Exchange, and Mintr.
There is also a community-run page full of helpful resources, and a snapshot of the current system status is always available live at dashboard.synthetix.io.