What is Sythetix?
The Synthetix Network Token (SNX) is an exchange-based token generated and distributed by Synthetix, an Ethereum blockchain-based decentralized synthetic asset issuance protocol.
Synthetix, developed by Kain Warwick and the Synthetix Foundation, is a decentralized synthetic asset issuance protocol. Initially, when it first released in September 2017, it was known as Havven. It managed to collect $30 million from the selling of 60 million HAV tokens to investors during its seed round and token sale.
The platform extended its vision in late 2018 and was called Synthetix. Today, the site is the biggest decentralized market in the decentralized finance (DeFi) room for derivatives, with an impressive cumulative volume locked (TVL) of ~ $ 700 million as of November 2020.
For Synthetix, the key use case is the development of synthetic tokens that follow the price of other properties. There are five kinds of properties currently that Synth tokens can register.
How Does Sythetix Work?
For eg, the DeFi index fund, which consists of a basket of different tokens from different DeFi protocols, is one of the most common investments in Synthetix. On Synthetix, the two most common tokens are iBTC and iETH, which monitor Bitcoin and Ethereum prices, respectively.
There may be substantial demand for these tokens, though, when Synthetix continues to fund new properties. Synthetix, for instance, would render investing in commodities such as gold or silver or even more obscure commodities such as copper or uranium simple.
These are markets that for the regular consumer are not necessarily easy to reach, so being able to purchase into them through Synthetix might be big.
For standard stocks like the S&P 500 or the NASDAQ, the same goes. Amongst other stuff, Americans and Europeans find it for granted that they will participate in these industries.
Hundreds of millions of persons across the globe, though, may not have ties to the American stock exchange. Synthetix would offer these buyers a way to take a role in industries to which they have never had access before.
Synthetix started collaborating with Chainlink at the end of 2019 to incorporate a decentralized feed price. Synthetix may build a token that records the price of almost everything by utilizing Chainlink as an oracle.
Because of the special design, we might see in the future all kinds of tokens being applied to the network.
The SNX token is the Synthetix protocol’s backbone. It is SNX that is used in Synthetix to build new synthetic tokens as leverage. This is analogous to the way ETH is used in MakerDAO to mint DAI as collateral. Similar to DAI, anybody can exchange it once a Synth token is created. Synthetix tokens can be exchanged on the Synth marketplace, and you don’t have to coin your own.
That being mentioned, there are a few explanations for SNX to be interested and to mint your own tokens.
SNX stakers will receive a share of all traders’ fees using the Synthetix exchange.
The SNX is a currency that is inflationary. An additional 160 million SNX tokens will be generated from March of 2019 to August of 2023. Both of these tokens would be allocated to SNX stakers, which ensures that anyone who invests for the whole period will have the sum of SNX they possess double as high as they do.
What is the History of Sythetix?
Synthetix began as Havven, a stablecoin project, and was created by the current CEO, Kain Warwick. With over $180 million worth of SNX tokens tied up in the protocol in December 2019, Synthetix is now one of the major ventures in DeFi.
The protocol has a very popular SNX token holder-a16z crypto-the investment fund that acquired 6% of the total MakerDAO token supply in September 2018. Nevertheless, a16z has never confirmed an SNX investment or even listed it. In the a16z address, there are clearly 374,111 SNX tokens without any description.
How Do I Hold Sythetix?
SNX can be held on any ERC20 Ethereum wallet. Metamask, MyEtherWallet, and MyCrypto are the 3 most common Ethereum based wallets. There are, however, several other alternatives available, such as Argent, Trust Wallet, and Coinbase Wallet.