Synthetix, can inventory have market share?

Heritage is a unique and young place in the DeFi space, which can serve as a bridge between blockchain and the real world. This article will first introduce what an asset is, explain knowing Synthetix as an asset, analyze data from Synthetix and other derivatives, and finally provide details.

What are synthetic materials?

Synthetic blockchain tools are users who commit to a quantity of tokens synthesize a tokenized tool (for example sGold) that the user chooses, and the reserve of the device is indexed to the real price (price of the 'gold) on the foreign exchange market. You can trade through Oracle.Essentially, man-made materials create blockchain data about the relationship between assets and consumers, and can even be thought of as tokenized derivatives.

Real estate can see real-world profits, products, and services, and consumers can make money without holding on to global profits, commodities, and stocks while still holding inventory.

What synthetic furniture has done in its current phase is to copy anchor costs.Then, as the digital process improves, it can be expected that in the future operations will try to complement the interaction between real estate and real estate assets through integration. connect offline assets to launch new assets.

Synthetix technical realization with synthesis tools

Synthetix Workflow Diagram

Image source: https://www.chainnews.com/articles/653539102473.htm

In the operation Fig. Synthetix, SNX Staker synthesizes Synthes (synthesis tool) with collateral SNX tokens for Mintr (forge) and at the same time incurring responsibilities is the basis and essence of all standard work. Synthetic Tool Synths are accessible in Synthetix Exchange or on outside markets for trading. Synthetix Exchange can calculate the cost of moving Synths assets to adjust the size of the debt incurred by Mintr. This ultimately led to the P&L of SNX.

1. Forging Synthetix Promises and Unlocking Promises

SNX owners can use Synthetix smart contracts to shut down SNX as responsible for mint synths (such as sUSD). While SNX interest rates meet the conditions for event issuance, Synthetix smart contracts add the cost of SNX mortgage payments to recorded debt.

By providing SNX as a responsibility, users can receive: 1) A percentage of Synthetix.ExchangeThe transaction pays for the exchange rates2)add a gift voucher,SNX owns the awards created by committed financial institutions.

Diagramme Synthetix Mint

Image source: https://staking.synthetix.io/staking

Before SNX lenders can opt out of the system or reduce their debt and release SNX proof, the debt must be paid. The procedure for reducing debt to zero is as follows: Synthetix smart contract determines the debt balance and eliminates “registration debt”. Destroy sUSD needs and update all sUSD and sUSD balance devices in user's wallet. At the same time, this SNX balance has changed. (If the commodity price is lower than the synthetic raw materials (sUSD), additional sUSD must be purchased from the second store.)

2. Calculation of expenses

Expenses are new income and stored in sUSD.After distributing the debt to the buyer, the Synthetix smart contract introduces the sUSD smart contract to deliver new value, which adds money to versatile Synth products and later distributes the new minted sUSD to the user's wallet. . . (As agreed, the exchange rate between the sUSD and the US dollar is fixed at 1: 1.)

Synth is powered by the Synthetix SNX token, and the staker must be SNX Compliant with an SNX value ratio of at least 400% (release ratio).

The standard for calculating Total Interest for Total SNX is: C-Ratio = Total SNX Supply * SNXPrice / Total Issued Synthesizers. To calculate the C-Ratio of Active Stakeholders (ACTIVE C-RATIO) eg Stakeholders, then use the evidence. The loan amount determines C for example. At the end of August 2021, the active C-Ratio was 778%.

According to the Synthetix Litepaper, the “liability” developed by the developers of SNX Mortgage Synth may increase or decrease depending on the exchange rate and the supply of the network by Synth, even if the price is significantly higher. . In short, if the other conditions have not changed, if only half of the synths in the system are sBTC and the value of BTC doubles, then all system costs and everyone's spending at risk will increase on a basis. monthly.

until now,synthesisThe process of reducing debt to zero is as follows: 1) The Synthetix smart contract checks the outstanding balance and eliminates the “debt recording”. 3) This SNX scale is configured to change.

Diagram of Synthetix Debt Management

Image source: https://staking.synthetix.io/debt

3. Synthetic exchange

QuantaKwenta is a restricted exchange traded under the Synthetix protocol.Order: 1) Prepare your Web3 wallet 2) Get Synth (sUSD is most used) 3) Do business using Kwenta.When users have sUSD or other synths available, users can create a wide range of assets by trading on the entire synth without having to pay attention to the trade.

When the new Synth asset finishes trading on a smart contract, it first breaks the original Synth (sUSD), including reducing the sUSD balance of the wallet and upgrading all sUSD devices, and calculates the exchange rate. (for example, based on the value of each currency) exchange rate), the exchange rate is paid, 0.3% of the current exchange rate, the value is called the payment rate sUSD (for the whole total portfolio SNX Loans), the rest 99.7% is provided by the Synth Smart Contract and Target Wallet (sBTC). It adjusts the balance and all the assets of the sBTC at the same time. Synths unlimited liquidity is considered as this process does not require a list of data or transactions.

In addition,The value of the total asset in the Synthetix system is determined by the oracle which automatically pushes the asset to the chain.Synths currently supports 5 types of assets: fiat, commodity, crypto, reverse crypto, and crypto indices.

4. Synthetix P&L Example

Synthetix revenue sample figure

Image source: https://docs.synthetix.io/litepaper/chinese/

In Example 1, suppose Media and Yan start using $ 50,000 of sUSD and the total network debt is now $ 100,000, Media and Yan each bear 50% of the total debt. . Media buys all sBTCs in sUSD and Yan still holds sUSD, but when the price of BTC goes up 50% and Media's position reaches $ 75,000, the entire network's debt goes up to $ 125,000. Medio and Yan each bear 50% of the total expenses, Medio and Yan both have $ 62.5,000 in debt, Medio's job is worth $ 75,000, and Yan's job is worth $ 50,000. In the final calculation, Medio received $ 12.5k and Yan lost $ 12.5k.

In Example 2, suppose Medio and Yan started using $ 50,000 of sUSD and the total network cost is now $ 100,000, with Medio and Yan accounting for 50% of the total debt. Medio buys all sBTC in sUSD and Yan short sells BTC in sUSD. If the price of BTC increases by 50%, Mediao has a position of $ 75,000 and Yan has a position of $ 25,000. The total debt is still $ 100,000, and the second is $ 50,000 each. Medio therefore won $ 25,000 and Yan lost $ 25,000.

Synthetic data analysis

Data to easily compare terms between Synthetix and existing derivatives (2021.08.25)

Data sources: Intotheblock, Messari, Defi Llama, Dune Analytics, CryptoYC

Synthetix's token, SNX, holds the highest market share, according to FTT, with the lowest market share being INJ.The most common type of swap is the perpetual process, which is 10 times better than Synthetix and FutureSwap. Synthetix has the highest guaranteed token value, over 100 times that of many other trades. And now the SNX token only promises 44% of Synthetix promises, and ETH promises 56% of total Synthetix promises. may be seenSynthetix is ​​more attractive to financial providers than other derivatives.

concludes

Users consolidate Synths on Synthetix and incur debt at the same time, this process lowers the cost of Synths and debt as well, allowing users to benefit and recoup again.Therefore, it is a short term risk for Mintr to assemble the synths of the Synthetix.However, these short-term sales are based on SNX tokens, and the exchange rate of SNX tokens directly affects users' actual profit or loss. Synthetix starts with a ratio of 400%, equivalent to a ratio of 0.25x.It is more difficult to attract risk takers compared to other derivatives with 5x and 10x leverage.Currently, Synthetix has sufficient investors, and Synthetix's ability to compete in the market in the future will depend on the suitability and activity of Synthetix traders.

Applications

1.https://stats.synthetix.io/staking

2.https://www.chainnews.com/articles/536427861778.htm

3.https://www.chainnews.com/articles/675957607302.htm

4.https://www.chainnews.com/articles/653539102473.htm

5.https://docs.synthetix.io/litepaper/chinese/

6.https://staking.synthetix.io/debt

7.https://staking.synthetix.io/staking