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Choose your quick section of our Syntetix review below.
A Quick Overview of our Synthetix Review:
Synthetix was built on the Ethereum blockchain and offers its users with access to a variety of highly liquid synthetic assets, also known as synths.
Synthetix Live Price
What is Synthetix?
Synthetix is a decentralised finance (DeFi) project and a distributed asset issuance protocol built on the Ethereum blockchain. Synthetix allows its users to issue and trade various synthetic, decentralised assets. This includes a blend of cryptocurrencies, fiat currencies, and even commodities.
Key Features and Takeaways of Synthetix
Synthetix is a unique and interesting DeFi project that has the following key features and takeaways:
Synthetix was built on the Ethereum blockchain and offers its users with access to a variety of highly liquid synthetic assets, also known as synths.
Synths work to track and provide returns to users on the underlying asset without the user having to hold the asset directly.
Synthetix is aimed at broadening the crypto space through the introduction of non-blockchain assets. In achieving this, Synthetix will provide users with access to a robust financial market.
Synthetix is a decentralised exchange (DEX) and a platform for synthetic assets.
Synthetix was designed in a unique way to expose users to underlying assets via synths without the user having to hold the underlying asset.
Through Synthetix, users can trade anonymously and there is also a staking pool where holders of the native token, SNX, can stake their tokens in return for rewards. These rewards are a portion of the transaction fees charged on the Synthetix exchange.
Synthetix tracks the underlying assets by using smart contract price delivery protocols that are known as “oracles”.
These smart contracts that are used by Synthetix are applications that execute automatically when the specific conditions are met.
Synthetix allows its users to trade synths through the exchange without any issues with slippage or liquidity. Due to the unique nature of Synthetix, the exchange eliminates the need for third-party facilitators.
SNX tokens are also used as collateral for the synthetic assets which are minted on the exchange. This means that when synths are issued to users, SNX tokens are locked in smart contract.
To reduce Gas fees and oracle latency, Synthetix has transitioned to the Optimistic Ethereum mainnet.
The developers behind Synthetix have built inflation into the exchange, meaning that the total amount of SNX which has been issued will increase from 100 million tokens to 250 million by 2025. Inflation was not initially included but added later when it became apparent that exchange fees alone are not incentive enough to issue Synth.
It is important for Synthetix to maintain a stable peg, allowing the system to remain stable, ensure good liquidity, and function well.
To ensure that the Synth peg is maintained, Synthetix employs three methods namely Arbitrage, a sETH Liquidity Pool on Uniswap, and a SNX Arbitrage Contract.
Synthetix Mining
SNX cannot be mined but can be staked. The process involved with staking starts with the user holding SNX tokens in wallet that is compatible with ERC20 tokens. Users must connect this wallet to the Synthetic Exchange and if they wish to stake their tokens, or mint Synth, the user must begin by locking SNX as collateral in the wallet.
The collateral requirement is 750%, ensuring that all Synth minted is relative to the requirement as well as the value of SNX which is locked in the wallet. Once Synth has been minted, anyone can access it and trade, invest, pay transactions, or anything else with the minted Synth.
Those who create Synth are considered as stakers in the system, earning them staking rewards. These rewards are determined by the amount of SNX that is locked, and the fees generated by the Synthetix exchange.
The more frequently the Synthetix exchange is used, the greater the total fees which are generated and subsequently, the larger the reward pool for those who stake.
Pros and Cons
| ✔️Pros | ❌Cons |
|---|---|
| Synthetix uses oracle technology to track price movements through smart contracts | The Synthetix system is still in development which means that there are no guarantees on its future growth or success |
| Users do not need to hold the physical asset when they trade on Synthetix | Users may have to burn more Synths to unlock their staked SNX |
| Synthetix provides users with exposure to different assets | The field of crypto projects is competitive and there are many new projects |
| Synthetix, amidst several other projects, is at the forefront of the DeFi movement | Synthetix currently faces centralisation issues |
| Synthetix is heavily dependent on Ethereum |
Transaction Fees
| Type of Fee | Information |
|---|---|
| Trading Fees | 0.3% per transaction |
| Withdrawal Fees | 3.5 SNX |
Should you buy Synthetix?
Synthetix promises to be one of the most successful DeFi projects in the crypto space, however, there are several concerns and issues that cause uncertainty with investors. Synthetix sounds like the future of trading and there are unique benefits to the exchange, but there is a significant risk involved with the Synthetix system.
The Synthetix system is still being developed and there is no guarantee that the project will be successful and that it will draw in more investors to guarantee long-term survival and growth.
Investors consider this a great risk, especially those who have staked SNX. With low utilisation and liquidity, it will cost investors more to burn Synths so that they can unlock the SNX that they have staked.
Synthetix is also dependent on Ethereum and there is the issue regarding the centralisation of the Synthetix project, with no clear indication of when it can stem off on its own and adopt true decentralisation.
How to buy Synthetix (SNX)
Step 1 – Register an account with Gate.io
Navigate to the official Gate.io website and select the option to “Sign Up” from the homepage.
Complete the online registration form by providing country/region, a selected username, email address, and user-selected password. Read and accept the User Agreement and Privacy and select “Next”.
Create a fund password and select “Create Account”. Complete the “I am not a robot” reCAPTCHA. Check your email inbox for the activation email and click on the link in the email. If the link does not work, you can copy and paste the URL into your browser.
Log into your account using your credentials and complete the reCAPTCHA.
Check your email again for the verification email that contains the 6-digit code and click on “Confirm”. Enter the code that you received into the blocks provided and select “Log In” to proceed.
Before you can use the platform to purchase Synthetix/SNX and other cryptocurrencies on Gate.io, you must complete the “Know Your Client” or KYC procedure to verify your identity and your proof of residence.
Click on “KYC Now” at the bottom of the webpage to start the process.
Select whether you are an individual or an organisation by selecting “Verify Now” under the relevant option.
Select your country from the dropdown list, enter your full name followed by confirmation thereof. Select your ID document type and provide your ID Number as shown on your official ID Document.
Click on the first image to upload a clear photo of the front of your ID document followed by a clear photo of the back of the document.
Next, write your Gate.io unique ID on a piece of paper and take a photo of yourself holding up your identity document (front) and the paper containing your unique ID.
Once you have done this, click on “Confirm and Submit”.
Next, you must enable the Timed One-Time Password (TOTP) to be able to log into your account. This can be done by clicking on “Set Now” at the bottom of the page.
On the new page that loads, select “Click here” to set up Two-factor Authentication.
Download Google Authenticator onto your mobile device by making use of any of the abovementioned methods.
Follow the steps indicated to add your Gate.io account by scanning the QR code or entering your unique key.
Enter the TOTP, your fund password, and the code sent to your email address and select “Enable Two-factor Authentication”. With this setup, you must use the Google Authenticator app to sign into your account every time.
Step 2 – Deposit funds
You must note that Gate.io is only a crypto-to-crypto exchange which means there is no fiat gateway. The only way through which funds can be added, is to transfer an existing crypto into your Gate.io wallet.
SNX can only be bought through Tether/USDT or Bitcoin/BTC while it can be traded with USD as a futures contract.
Navigate to the deposit/withdrawal section by hovering over your account and selecting the relevant option. Choose from the list of coins in which you can make a deposit and select “deposit” next to the appropriate coin.
You will be redirected to a page which generates a deposit address for the coin that you wish to deposit.
Copy this address, or scan the QR code, into the wallet where you are making a withdrawal from and depositing to Gate.io and wait for the relevant blockchain to confirm your transaction. Once the transaction has been completed and verified by the nodes on the chain, the coins will be sent to the Gate.io wallet and you can start trading SNX.
Step 3 – Explore your trading options
Gate.io offers a variety of ways through which cryptocurrencies can be obtained. Each of these can be explored individually depending on your trading needs and objectives.
To start trading SNX, select the option from the “Trade” Menu. Enter “SNX” into the search bar to see which trading options are available.
For spot trading, for instance and as an example, select SNX_USDT. Once you have selected, you will be directed to the exchange page which corresponds to the cryptocurrency pair SNX/USDT.
Here, you will see that you have the option to buy or sell SNX either as a limit order, grid trading, or as a time condition. The most common trading method is that of limit trading and thus it will be used for this guide.
Step 3 – Buy SNX through via Limit Order
To buy SNX and create a limit order for it, you can enter the amount of SNX you want to purchase, and the price you want to buy it at in USDT. This tool will tell you what the overall cost is in USDT, or any other chosen counter-currency, which will be deducted from your wallet once the order has been executed.
Step 4 – Sell SNX through via Limit Order
To sell SNX, find the panel under the chart and create a limit order for USDT according to your own preferences. Note that with a peg to USD, SNX that you exchange for USDT will hold the flat value that it has despite market conditions in the cryptocurrency market.
Step 5 – Withdraw funds
To withdraw funds, you will use the same page in Gate.io which was used to make a deposit.
Click on the deposit/withdrawal option on your Account dropdown and find the wallet of the currency that you wish to withdraw. You can do this easily by using the search bar provided.
Instead of a deposit address being generated, you will do this on the exchange, or the wallet being used as the destination for withdrawal of funds from Gate.io. Paste the address of the receiving wallet in the field provided and provide your Gate.io fund password, email code, and TOTP before selecting “Submit Request”.
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Frequently Asked Questions
When was Synthetix first launched?
Synthetix was launched in 2017.
Who founded Synthetix?
Synthetix was founded by Kain Warwick as Havven (HAV), with the rebranding happening a year later.
What is “ICO”?
It is Initial Coin Offering that, unlike an IPO, does not mean that those who invest in the cryptocurrency will have an ownership stake of the company that they provide funds to.
When was Synthetix’s ICO and how much did it raise?
Synthetix’s ICO was in 2017. During the ICO for SNX, there were seed rounds and token sale stages which raised more than 419 million ZAR.
Is Synthetix legit?
Yes, Synthetix is legit.
What is Synthetix’s total supply?
The total supply of SNX is 212 424 133.
What is the purpose of Synthetix?
To provide users with access to a variety of crypto and non-crypto assets that can be traded.
On which blockchain is Synthetix based?
Synthetix is based on the Ethereum blockchain.
Does Synthetix work with smart contracts?
Yes, Synthetix uses smart contract price delivery protocols to track underlying assets on the exchange.
Does Synthetix have potential to become more valuable?
Yes, Synthetix has the potential to become more valuable in the long-term with the widespread adoption of cryptocurrencies, DeFi, DEX, and blockchain technology.
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