Last year's "50 times myth" has doubled again this year. Can DeFi synthetic assets still be used?
Editor's Note: This article comes fromHot Wheels Community (ID: FHBT18), Author: Pepe, reproduced by Odaily with authorization.
Editor's Note: This article comes from
Hot Wheels Community (ID: FHBT18)
Hot Wheels Community (ID: FHBT18)
, Author: Pepe, reproduced by Odaily with authorization.
CCTV said that Ethereum has risen by 164% this year, and encryption has increased by nearly 70%. That video went crazy in the currency circle today, but I looked around. . Feel. . By the way, do you feel that you are making money?
I saw a picture in the circle of friends before:
In fact, the real earners in this wave of defi are the early participants of many projects, who use and hold them when their market value is small or no one cares about them. However, how many people in this market can really do it? How can you stick to your choice when they are at a low point, when they are skyrocketing and plummeting? Or are you willing to grow up with these targets?
You can think about it.
Hello everyone, I’m Pepe. Let’s do a make-up class this weekend. I said I wanted to talk about SNX and synthetic assets, but I didn’t find a good opportunity. In fact, there were sporadic things about snx before. It was mentioned, but there has been no systematic talk about it.
Regarding snx, Synthetix’s token, people’s main impression of it may be the amazing price fluctuations. The following figure shows the price changes from May 2018 to the present:
Today's price is 4.73U. According to the historical high point (7.8U) on September 1 this year, it has fallen by 39%, but it has increased by an astonishing 135 times from the lowest point (0.034U) in its life cycle!
And just like the 2019 part marked with the red box in the picture above, we seem to be common now, but in fact, the increase from the lowest point in 19 years to the highest point in the red box has increased by as much as 50 times, which also makes it used to be Known as "the light of the bear market".
And the reason why we don’t feel very obvious when looking at the picture is because this year in this wave of defi, it has increased tenfold!
Why is the growth so violent? Let's start with this platform.
The Synthetix platform, I think you can also understand it as a dex exchange, but the biggest feature of this exchange is that it can synthesize assets.
The so-called synthetic assets are very simple, which is to generate asset B by mortgaging asset A. Like the two old brands in the currency circle, one is to generate bitcny by mortgaging bts, and the other is to generate DAI by mortgaging ETH in the maker, both of which belong to the category of synthetic assets.
The assets generated here are equivalent to the "debt" generated by the loan, that is, if I generate btc, it is not actually the real btc on the chain, and its value endorsement comes from its collateral. Generally speaking, the collateral The market value of the debt is higher than the debt incurred.
For example, 150U of eth in the maker can be mortgaged to generate 100U of DAI.
On Synthetix, compared with the previous mainstream synthetic asset platforms, its collateral is only its platform currency SNX, but it is also more flexible, that is, it can mortgage SNX to generate various assets, even out-of-circle assets, such as US stocks or gold (stocks) Assets are still part of future planning for the time being).
His family's economic model is as follows:
Generate SUSD by staking SNX, which can be done through its dapp website:
At present, the minimum mortgage rate is 600%, that is, SNX with a mortgage value of 600U can generate up to 100U of sUSD. This mortgage rate seems to be adjusted according to the network status, because the mortgage rate was 750% in the past few months.
And if your mortgage rate is lower than the platform requirements, that is, when the value of SNX falls, or the price of platform assets rises, you need to mortgage in SNX again.
When the mortgage rate meets the requirements of the platform, the locked SNX can be redeemed by destroying sUSD. If the mortgage rate is insufficient, SNX can only be locked in the contract until the target value is met before the redemption operation can be performed or the platform incentives can be obtained.
I don’t know if there should be no halo here, haha, the advantage of this mechanism is that when snx is in a downward trend or the entire market is in a bull market, it will increase its buying demand, and relatively speaking, it will also reduce the rate of snx price decline or When the market is good, there is also the possibility of being taken away.
The minted sUSD, you can choose to use them to go long or short any target on the platform, other exchanges:
According to the size of the trading volume, I have intercepted some of the main trading pairs at present:
https://www.stakingrewards.com/earn/synthetix-network-token/calculate
The ones with i in front of the above are short-selling, like ieth, you buy, and it will rise when eth falls, and the ones with s are buying and doing long. Looking at the trading volume, it seems that the volume is concentrated on shorting eth.
In addition, another feature of his family is that it can go long and short some indexes, such as the above sDEFI, but the transaction volume is not large at present, and the entire platform transaction is basically only 9 volumes, which is a little bit.
If sUSD is minted and not used, you can also get the platform’s mortgage reward and 0.3% transaction fee sharing.
https://dashboard.synthetix.io/
The mortgage rewards on this platform are amazing. It’s the kind of level that even the next door’s funds are daunting. At the earliest time, I remember that the annualized mortgage can reach 70%, and now it’s 44%:
The original intention of the official is to make this incentive high, so high that you feel that you will lose money if you simply hold it, so that people can be encouraged to mortgage to the network.
According to a previous data, from March 2019 to March 2024, the total supply of SNX is expected to increase from 100 million to 240 million, and the newly issued SNX will be allocated to SNX that meets the mortgage rate according to the mortgage ratio Stakeholders, so the rate of return for users depends on the network's staking.
This mortgage situation can be queried from the official data website:
At present, the mortgage ratio of the entire network is 72%.
I saw someone compare Synthetix to the uniswap of the synthetic asset platform before. In fact, let alone, it is quite similar:
1. There is also no order book trading model, uni is priced based on the ratio of the liquidity pool, and snx is simpler and cruder, directly feeding the price through the oracle.
2. This high incentive may seem exaggerated, and many people may not understand the difference between it and Ponzi, but in fact, it is the same as the incentive for liquidity mining, and there are corresponding risks behind it.
For those who mortgage sUSD on the platform, they are the same as the market makers who provide liquidity on uni. They are the counterparties of all transactions on the platform. If the traders generally make money, it means that they only mortgage sUSD It is a loss.
For mortgage sUSD, here is an example from his white paper:
If there are only two players on the platform, A and B, they pledged sUSD worth 50,000 US dollars respectively, which is equivalent to a debt of 100,000 US dollars, and they each bear 50%. If A buys sBTC with sUSD worth $50,000 and the price of Bitcoin rises by 50%, the value of the debt pool will increase to $125,000, and the debts of A and B will increase from $50,000 to $50,000. $62,500. Among them, A who holds sBTC can still get a profit of 12,500 U.S. dollars after repaying the debt, while B who only holds sUSD from the beginning to the end has increased the debt of 12,500 U.S. dollars.
This is the same as market making. It may be compensated by incentives, but it may not be compensated for certain periods of time.
The above is an introduction to a basic model of snx. It should be said that the rise in 19 years was mainly due to the low liquidity. His family was not listed on any exchanges at that time. In fact, many people who saw this project at that time were helpless and inconvenient. Purchasing channels, and there are too many mortgage purchases motivated by high mortgage income. This year, it is more due to the fact that a high mortgage network meets liquidity mining. Snx has been added to many project fund pool options. This It also virtually increases the demand for its token.
The current problem with SNX is:
1. Judging from the historical situation, skyrocketing and plummeting is commonplace. Moreover, it is necessary to know that holding snx without mortgage is risky. The platform design is to "punish" lazy friends by mortgaging high yields, but mortgages are only Swapping out sUSD is also risky. After looking at the platform, basically the proportion of long orders is relatively high:
2. One of the reasons for the relatively rapid growth of snx’s market value in the past two years is that large investors dug up more and continued to mortgage more, but did not release them to the market:
Here I intercept the SNX account dynamics of a third-ranked whale, and you can feel how much their interest income is:
epilogue
Because of high inflation, rewards will flow in faster and gather in the hands of large players to form a monopoly. It is hard to say whether it is a good thing or a bad thing.
3. In fact, as can be seen above, the trading volume of his exchange is not as bright as uniswap, and his market is still formed by adding new tokens instead of handling fees, which means that the fundamentals are not so good , and if this supports a market value of 1 billion US dollars, emmm...
