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Friday, February 3, 2023

Synthetix racks up over $1M in daily fees as SNX token value surges 100%

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Layer-2 scaling answer Synthetix not too long ago collaborated with liquidity supplier Curve Finance to create Curve swimming pools for sETH/ETH, sBTC/BTC, & sUSD/3CRV, permitting traders to cheaply convert synths such as sETH to Ether (ETH).

Given the traders’ willingness to carry tokens as an alternative of synths, the protocol racked up over $1.02 million in buying and selling fees — overshadowing Bitcoin’s (BTC) daily efficiency by 5 occasions.

Synthetix, Ethereum-based decentralized finance (DeFi) protocol, created a buzz throughout the crypto ecosystem after witnessing a sudden enhance in buying and selling actions and an unprecedented comeback of its in-house token, SNX, throughout an unforgiving bear market.

Crypto fees of standard initiatives. Source: cryptofees.data

As a direct results of the large buying and selling volumes, the SNX token, too, witnessed a momentary surge of 105%, bringing up its value to over $3 based mostly on data from CoinMarketCap.

Synthetix (SNX) value index. Source: CoinMarketCap

Sharing his ideas on the event, Synthetix founder Kain Warwick a.ok.a kain.eth released a weblog publish that highlighted the problem of DeFi protocols to soak up Bitcoin’s volatility if the worth drops even additional:

“This is critical to understand, Synthetix is an over-collateralised crypto-backed suite of stablecoins, it CAN implode.”

However, he attributed Synthetix’s latest success to the responsiveness of the group to tough circumstances and a willingness to experiment with novel mechanisms to supply stability.

On May 31, the entrepreneur revealed that SNX tokens contribute to 99% of his general liquid portfolio.

On the flipside, on-chain metrics revealed the intentions of shorting the SNX token throughout quite a few exchanges. @napgener from Crypto Twitter disclosed that 15 million SNX tokens preserve a brief place on standard exchanges together with Binance, FTX, ByBit and OKX. While solely 20 million SNX tokens exist on exchanges, the revelation factors to an oncoming value hike, which could see SNX breach a value of $10.

The Twitter consumer additionally alleged that the Celsius community is providing a 300% Annual Percentage Rate (APR) to customers for shorting their SNX holdings. 

Related: El Salvador president addresses bear market concerns with Bitcoin hopium

With Bitcoin costs falling under $20,000 over the weekend, El Salvador President Nayib Bukele shared a bit of optimistic recommendation on Twitter.

In his tweet, Bukele suggested fellow traders to “stop looking at the graph and enjoy life.” He reassured traders about Bitcoin’s inevitable comeback, stating that:

“If you invested in #BTC your investment is safe and its value will immensely grow after the bear market. Patience is the key.”