FTX affiliate: Trade on FTX exchange and get 5% of your trading fees back.

Categories
DeFi Ethereum

Synthetix (SNX) token explained

What is Synthetix?


Synthetix allows the creation of synthetic assets on Ethereum. These can then be used to track the price of any other asset, like currencies, commodities, equities, loans, and other cryptocurrencies.

SNX is used for


  • Collateralization of synthetic assets.

How does the SNX token work?


In order to mint a Synth or iSynth, owners must first lock their SNX tokens as collateral, with a current collateralization ratio of 750%. Which is subject to change through governance. Similar to what Aave does for loans.

Minting is done through the app Mintr.

Synthetix uses three types of tokens.

  • SNX -Acts as the foundation of the network and is used to create synthetic assets.
  • Synth – A synthetic asset generated from within the platform. Commonly used to track the price of an asset.
  • iSynth – iSynths inversely track the price of assets via price feeds.

Examples of synths

  • sUSD
  • sDeFi

Each iSynth has three important points:

  • an entry point (at which it is entered into the system)
  • an upper limit
  • a lower limit.

Synths price feeds


Price feeds are supplied by Chainlink’s oracle network of distributed node operators.

Synthetix Liquidity


Liquidity is pooled by merging the collateral and issuing tokens against this combined total. The functionality of the exchange provides practically infinite liquidity across the platform.

Whitepaper / Docs


Litepaper

Docs

Token issuance


  • Maximum Supply – 197,745,248
  • The ICO took place in February 2018, under the previous name of Havven, raising close to $30 million.
  • The ICO token price was $0.670.

SNX price


Crypto tax affiliate

Koinly was the only service that actually solved our problem with DeFi and Crypto tax.

 

Affiliate: Learn more about blockchain and crypto with courses at Skillshare.