Synthetix has launched a new app chain, SNAXchain, which aims to provide cross-chain liquidity and trading fee revenue to native token stakers and on-chain trading products, Synthetix core contributor Matt Losquadro told Cointelegraph on September 6.
According to a September 4 post on X Platform, AppChain will initially serve as an on-chain governance platform that will govern Synthetix deployments on the Ethereum mainnet and Layer 2 (L2) extension chains, including Optimisim, Arbitrum, and Base.
SNAXchain is designed “to establish a neutral hub for governance and protocol decisions, especially as Synthetix expands to additional chains and L2,” Losquadro told Cointelegraph.
However, Synthetix is “actively exploring future features for SNAXchain, including SNX staking, cross-chain liquidity, and powering custom perks products,” Losquadro said. “Expect more proposals for these features in Q4.”
The long-term goal of the protocol is to start staking SNX (SNX) on SNAXchain and share liquidity across multiple L2s using Optimism’s Superchain, Losquadro added.
Arbitrum’s Synthetix liquidity pool. Source: Synthetix
relevant: Bitcoin yield opportunities are skyrocketing. Here’s what to watch for:
SNAXchain operates on Optimism’s Superchain, an interconnected layer 2 network built on Optimism’s technical assets, and uses interoperability platforms Conduit and Wormhole for cross-chain messaging.
Synthetix is a decentralized finance (DeFi) protocol that specializes in providing “liquidity for permissionless derivatives such as perpetual futures and options.” It was launched in July on Arbitrum (widely considered the leading Layer 2 for DeFi on Ethereum).
Perpetual futures, or “perps,” are derivatives that allow traders to buy or sell an asset at a future date with no expiration date. DeFi protocol GMX currently dominates Arbitrum’s decentralized perps market, with a total locked value of over $450 million, according to DefiLlama.
Synthetix’s ability to accept a variety of tokens as collateral could differentiate it from Arbitrum’s competitive DeFi ecosystem, Losquadro told Cointelegraph in August.
According to the website, the DeFi derivatives platform currently accepts tokens as collateral, including wrapped Ether (WETH), USD Coin (USDC), and Arbitrum’s native token, ARB (ARB). Liquidity provider yields in the form of SNX incentives range from around 7% to nearly 16%.
According to a post on the X Platform, GMX launched a series of products called GMX Liquidity Vaults on September 4, designed to improve the capital efficiency of liquidity providers.
magazine: Synthetix Founder Kain Warwick: It’s Not Markets That Are Wrong, It’s DeFi