24.05.21

Purchasing at a discount: Synthetix, the primary driver of growth

Purchasing at a discount: Synthetix, the primary driver of growth

Due to high commissions in the Ethereum network, trading in Synthetix instruments and staking SNX are no longer advisable. There are big hopes for integration with Optimism Ethereum (Layer 2 solution). Should it prove possible to avoid systemic risks inherent in the transition, the protocol will be able to sizably raise its product attractiveness.

SNX holders receive rewards in two areas:

  • DAO-controlled inflation: the coins are distributed among issuers of SNX based on a schedule, encouraging investors to create new tokens.
  • sUSD trade commissions: these accumulate in a separate pool and are then distributed to each holder according to the size of their share. The more traders trade synthetic coins, the larger the reward. The larger the reward, the higher the demand for SNX among investors who want to receive passive income.

APY currently sits at 28.1%, mostly due to inflation. Layer 2 integration should significantly reduce gas consumption and stimulate lucrative growth from trade commissions. Optimism’s data shows Synthetix users save approximately $10 million per 100 000 transactions.

SNX is currently trading 50% lower than its February highs.

Support is in the $10-12.80 range. While quotes hold above $7.80, we remain bullish. Our target is $47.60-64.80.

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