Synthetix Network (SNX) Research

Synthetix Network (SNX) Research Details

Synthetix Network (SNX) Synthetix Network

INTRODUCTION

Synthetix is an Ethereum-based derivatives liquidity protocol that allows users to create, own, and trade a variety of derivatives, including commodities, fiat currencies, and even stocks. It can create various synthetic assets from the digital and physical world. Synthetic assets are referred to as synths, and anything with value can become a synth.

Synthetic assets are a collection of securities used to represent the price of another underlying asset. Members can view any supported derivative in this manner without having to worry about maintaining the underlying asset itself. This enables users to instantly move between abstract assets (such as ETH and APPL) without any time delay or exchange fees. Fiat currencies such as the dollar, cryptocurrencies such as Ether or Bitcoin, and precious metals such as gold and silver are all examples of this.  



HISTORY AND FOUNDER

Synthetix, previously known as Haven, began as a stablecoin, but its developments under founder and current CEO Kain Warwick resulted in Synthetix tokens valued at $180 million, making it one of the largest investments funds secured with a Defi protocol of December 2019.

It began as a stablecoin but has subsequently expanded into decentralized finance.

Warwick has prior experience creating Australia's largest cryptocurrency payment site, Blueshyft, as well as other websites. Justin Moses and Clinton Ennis are the remaining two well-known members of the Synthetix core team.


REASON TO BUILD THE PROJECT

Many transactional operations are supported by Synthetix, all of which operate on a token-based system and support price inflation, barter, and compensation.

It operates similarly to MakerDAO, where DAI is created by enclosing ETH. In order to create USD, the main Synthetix is kept inactive(synthetic USD).

The ability to use SNX as collateral for any asset trade distinguishes Synthetix from Maker DAO.


BASE OF PROJECT

Synthetix takes advantage of Chainlink's decentralized oracles, which are more reliable and hard to interfere with. All the synthetic assets have an appropriately right value at true current prices.

On the governance aspect, the Synthetix Foundation initially managed the protocol. It was essential to further decentralize protocol control even though this was a non-profit company. Three distinct DAOs are now present, each in charge of a different protocol:

·       SynthetixDAO: A DAO that gives money to people who help accelerate the protocol.

·       Grants DAO: This organization provides funding for community suggestions that enhance the protocol.

·       ProtocolDAO: This is the central authority responsible for generating smart contracts and monitoring protocol upgrades.


USE CASE

The use case of Synthetix tokens are:

·       SNX tokens are used as a guarantee when creating synths, which are synthetic assets that can be traded with other network users.

·       SNX tokens are also regarded as governance tokens, which means that token owners have a stake in the decisions made for the entire system.

·       Holders of SNX have the ability to make proposals, cast votes, and influence judgments.


MAJOR NEWS AND EVENTS

DATE

NEWS/EVENTS

IMPACT

20/06/2022

As trading volumes skyrocketed, Synthetix increased

+108% Increase

04/07/2022

SNX reaches multi-week highs as Synthetix's total value locked exceeds $1 billion

+30% Increase


CONCLUSION

The Synthetix project brilliantly illustrates the immense potential that lies inside the DeFi ecosystem. As one of the founding members of DeFi, Synthetix has established itself as a trustworthy protocol for trading derivatives, creating new synths, and making money through staking.

The Synth exchange's adaptability opens up a whole new range of possible trading methods. It has the potential to develop a substantial tokenized market of digitalized real-world assets on the Ethereum Blockchain, though it is currently in its development.

The team behind the protocol has the right idea and seeks to close the gap between the conventional financial markets and DeFi. Users can trade in real-world assets like forex, commodities, and even more, using the Synthetix protocol without the involvement of financial intermediates due to the power of DeFi and blockchain technology.


DISCLAIMER

Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto products are currently unregulated and subject to market risk. Please seek independent financial advice or do your own research before investing.