Synthetix in L222
Hello Eth Denver friends, thank you for your interest in Synthetix and what we anticipate to be a huge L222 for our protocol. Read on for a brief rundown of the exciting developments coming to fruition this year, and for more, head to the Synthetix L222 Roadmap pieced together by SNX Spartan Council Member, Kain Warwick.
Scaling on Optimism
L222 has seen Synthetix transition from a bespoke derivatives liquidity protocol to one of the most prominent infrastructure networks on Ethereum, on which innovative new projects are learning off, building on, and engaging with the community. The transition to L2 with Optimism, partnered with bleeding-edge protocol developments planned for this year, signals the most optimized, fun, and fruitful user experience yet - as L222 sees Synthetix scale to the globe.
Synthetic Futures
The finalized Synthetic Futures code is exciting. It’s the most robust feature we’ve delivered since the launch of the original Synthetix contracts in late 2018. Our new composable synthetic futures enable novel products and integrations, as traders can now gain long or short exposure to dozens of synthetic assets that, we believe, will enable novel integrations with other DeFi protocols beyond simple long/short trader positions.
Monetary policy changes
When we talk about the staking ratio, we’re referring to the percentage of SNX tokens used as collateral within the network. In 2018 an inflation rate was introduced to encourage a high staking ratio while the SNX network was growing. Staking on SNX was fire - the ratio was over 90%. Then as inflation declined, the ratio fell to below 70%. Our new monetary policy sees an ambitious new target ratio of 85% to help drive staking, adoption, and renewed awareness of the protocol as we ramp up SNX activity in L222.
V3GM enables the next generation of projects
The V3 Governance Model is groundbreaking for the future of governance and DAO tooling. Its design is the culmination of four years of governance R&D within SNX and across DeFi. We think that V3GM is so important, that not only are we planning to use it for all future SNX governance, we are planning to launch it as a standalone protocol. The model will enable the next generation of projects to launch with purely on-chain governance that is flexible and fully decentralized, putting the ultimate power of governance in the hands of token holders.
The cross-chain bridge solution
Integrity and conviction will always be crucial values to the Ethereum ecosystem. To this end, we have stood strong on reserving SNX utility to Ethereum L1 and L2 on Optimism only. So when we started a conversation about deploying SNX exchange contracts on multiple Ethereum L2s and EVM compatible L1s - it was huge. Kain shared the proposed revolutionary cross-chain bridge solution earlier this year, when the concept of Synth teleporters was born, and paved the way for SNX to enable secure cross-chain bridges. While the community is still focused on Ethereum, we believe in the continued growth of the ecosystem, which means embracing competitors and their communities and expanding to new networks that have gained traction over the last few years.
Debt Pool Synthesis
Right now, each chain that SNX is deployed on has its own isolated debt pool. Important to the emergence of cross-chain-bridging - to provide maximum liquidity across chains we need to allow Synth teleporters to be transferred seamlessly between multiple chains on L1 and L2, via cross-chain messaging. So, we will no longer rely on automated market makers which are limited by the depth of their liquidity pools and subject to slippage but allow for a seamless debt pool synthesis - starting with the merge of L1 and Optimism.