SNX is the native cryptocurrency of the Synthetix platform and is used as collateral to create synthetic assets. Token holders can lock their SNX in smart contracts to mint Synths, which can then be traded on the platform. SNX holders are also rewarded with a share of the platform’s fees and can participate in governance decisions that shape the platform’s development. This makes SNX a central component of the Synthetix ecosystem.
Synthetix operates by using smart contracts and collateral to create synthetic assets. Users lock their SNX tokens as collateral and can then mint Synths equivalent to the value of the collateral. Synths mirror the prices of their underlying assets and can be traded freely without actually owning the real-world asset. The platform also uses a decentralized oracle mechanism to ensure accurate price updates. This model provides users access to a wide range of markets with high liquidity and low costs.
Why does Synthetix exist?
Synthetix exists to provide users with access to financial markets in a decentralized and borderless manner. The platform aims to break down barriers often present in traditional financial systems, such as geographical restrictions and high fees. By enabling the trading of synthetic assets, Synthetix offers an alternative that is more transparent, accessible, and inclusive, contributing to the creation of the financial system of the future.
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Website: https://synthetix.io/
White paper: https://docs.synthetix.io/