New Synthetix app chain aims for cross-chain liquidity for SNX staking, perps

Synthetix has launched a new app chain — SNAXchain — aimed at bringing cross-chain liquidity and trading-fee revenues to native-token stakers and onchain trading products, Matt Losquadro, a Synthetix core contributor, told Cointelegraph on Sept. 6. 

The app chain will initially serve as an onchain governance platform to manage Synthetix deployments on Ethereum mainnet and layer-2 (L2) scaling chains, including Optimisim, Arbitrum, and Base, according to a Sept. 4 post on the X platform. 

SNAXchain is designed to “enable a neutral hub for governance and protocol decisions, particularly as Synthetix expands to additional chains and L2s,” Losquadro told Cointelegraph. 

However, Synthetix is actively exploring “future functionality for SNAXchain, including staking for SNX, cross-chain liquidity, and powering a custom-built perps product,” Losquadro said. “Look for more proposals around these features in Q4.”

The protocol’s long-term goal is to launch SNX staking on SNAXchain and share liquidity across multiple L2s using Optimism’s Superchain, Losquadro added.

Related: Bitcoin yield opportunities are booming — Here’s what to watch for

SNAXchain operates on Optimism’s Superchain — a network of interconnected layer 2s built on Optimism’s technology stock — 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 like perpetual futures, options.” It launched on Arbitrum—widely considered Ethereum’s leading layer-2 for DeFi—in July. 

Perpetual futures, or “perps,” are derivatives that let traders buy or sell an asset at a future date with no expiration. DeFi protocol GMX currently dominates the decentralized perps market on Arbitrum. According to DefiLlama, it has more than $450 million in total value locked (TVL). 

Synthetix is betting that its ability to accept a variety of tokens as collateral will differentiate it in Arbitrum’s competitive DeFi ecosystem, Losquadro told Cointelegraph in August. 

According to its website, the DeFi derivatives platform currently accepts collateral in tokens, including wrapped Ether (WETH), US Dollar Coin (USDC), and Arbitrum’s native token, ARB. Yields for liquidity providers, in the form of SNX incentives, range from around 7% to nearly 16%.

On Sept. 4, GMX launched a series of products—called GMX Liquidity Vaults—designed to improve capital efficiency for its liquidity providers, according to a post on the X platform. 

Magazine: Synthetix founder Kain Warwick: It’s DeFi that’s wrong, not the market