Synthetix To Launch SNAXchain Appchain On Sept. 16

Synthetix, the veteran DeFi derivatives protocol, is the latest web3 project to adopt appchain infrastructure.

On Sep.4, Synthetix announced that its new SNAXchain Layer 2 network will launch on Sept. 16, coinciding with the activation of the project’s next governance epoch.

Synthetix said the network will serve as “a neutral hub” for governance and protocol decisions amid the protocol’s cross-chain expansion.

SNAXchain leverages Optimism’s OP Stack infrastructure, paving the way for its integration into Superchain — Optimism’s burgeoning ecosystem of interconnected networks leveraging its technology.

Synthetix is currently the second-largest protocol on Optimism’s OP Mainnet L2, accounting for $103.3 million of the chain’s $570.2 million total value locked (TVL). Synthetix boasts a $224.8 million TVL across all deployments. Synthetix is currently live on Ethereum, OP Mainnet, Arbitrum, and Base.

“Synthetix has a Long history working together with Optimism to scale Ethereum and provide a home for derivatives trading,” Synthetix said. “We were the first deployment on OP mainnet, and now will graduate to our own appchain… The Optimism Superchain infrastructure will enable a larger scope of utility for the chain.”

Synthetix also tapped Wormhole to facilitate cross-chain communication between SNAXchain, Optimism, and Ethereum, and Conduit to manage the network’s infrastructure.

The price of SNX is down 3.4% over the past 24 hours, according to CoinGecko.

Governance council elections

The Synthetix community also commenced voting on the project’s security council elections on Sept. 6.

Three councils oversee Synthetix governance. The Spartan Council administers core protocol development and improvement proposals, the Treasury Council manages the project’s finances, budget allocations, and funding, and the Ambassador Council handles community outreach and external partnerships.

Council member nominations began on Aug. 30 and remained open until voting began. Prospective nominees needed to nominate themselves on SNAXchain.

The new epoch will commence on Sep. 16, coinciding with SNAXchain’s public mainnet launch.

Synthetix’s market share declines

The launch of SNAXchain follows Synthetix's DeFi market share tumbling in recent months.

While Synthetix mounted a comeback during Q3 2023 and Q1 2024, with its TVL nearly tripling to $1.02 billion from mid-October until late March, the protocol’s TVL has subsequently crashed 78% to sit at its lowest level since June 2020.

The volume of Synthetix Perps V2 also crashed 40% to $6 billion from $10 billion during Q1.

However, the value of liquidity providers’ collateral grew 150% in Q2 to $25 million from $10 million in Q1.

Synthetix launched in 2017, comprising a decentralized platform allowing users to trade synthetic assets representing real-world assets, such as gold, stocks, or fiat currencies.

The 2022 launch of Synthetix V2 facilitated perpetual futures assets and expanded the protocol onto Optimism. The project began the phased rollout of Synthetix V3 last year, with the platform offering a modular architecture, cross-chain compatibility, and yield-bearing collateral for decentralized perps.

Synthetix now specializes in providing liquidity for permissionless derivatives, including perpetual futures and options.