{"id":34400,"date":"2022-08-26T04:18:11","date_gmt":"2022-08-26T08:18:11","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=34400"},"modified":"2022-08-26T04:18:14","modified_gmt":"2022-08-26T08:18:14","slug":"synthetix-wants-to-permanently-stop-using-snx-money-printer","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/synthetix-wants-to-permanently-stop-using-snx-money-printer\/","title":{"rendered":"Synthetix wants to permanently stop using SNX money printer"},"content":{"rendered":"\n
If the plan were to be implemented, Synthetix would operate much more like a conventional company by only collecting fees and giving the money to SNX holders.<\/h5>\n\n\n\n
\"Synthetix
Synthetix wants to permanently stop using SNX money printer<\/figcaption><\/figure>\n\n\n\n

Kain Warwick, the creator of Synthetix's decentralized finance (DeFi) technology, has proposed a proposal that would stop excessively high yield returns for SNX stakers and set a 300 million token supply limit.<\/p>\n\n\n\n

On the Ethereum <\/a>and Optimism networks, traders can issue synthetic replicas of traditional financial assets, commodities, and native crypto assets using the Synthetix protocol.<\/p>\n\n\n\n

Warwick stated in a Synthetix Improvement Proposal (SIP) dated August 25 that SNX reward inflation was initially meant to “bootstrap the network,” but he now believes it is unnecessary because atomic swaps may produce stable fee yields.<\/p>\n\n\n\n

\n

monthly trading volume on @synthetix_io pic.twitter.com\/QCWYbB5Xu4\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a><\/p>— Token Terminal \ud83d\udcca (@tokenterminal) August 25, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

DeFi protocols<\/a> 1inch and Curve began using the Synthetix platform to carry out atomic swaps, increasing traffic to the protocol, leading to a significant increase in fee revenue. In June, the protocol's daily fees exceeded $1 million, which was four times what Bitcoin was bringing in.<\/p>\n\n\n\n

The seven-day average charge for Synthetix, according to cryptofees, is currently $158,857, which is slightly less than the seven-day average fee for Bitcoin, which is $222,651.<\/p>\n\n\n\n

All SUSD stablecoin fees paid by protocol users are distributed to stakers. Currently, the APY for stakers owing to SNX rewards plus SUSD fees is about 67%, but if it's based purely on “actual return” on SUSD fees alone, this is likely to decline closer to 15%\u201320%.<\/p>\n\n\n\n

Warwick, who is regarded as the “father of modern agriculture” for popularizing DeFi yield farming, stated in a tweet on Thursday that he thought “SIP-276: Turn off the money printer” had a “good chance” of passing after informal discussions. The suggestion will be formally presented the following week.<\/p>\n\n\n\n

\n

Just proposed a SIP to end SNX inflation at 300m tokens in ten weeks. After informal discussions today, it seems like it has a decent chance of passing. A formal presentation is planned for next week. Inflation was designed to bootstrap the network and it has done the job.<\/p>— kain.mega (@kaiynne) August 25, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

The current total supply of 293 million SNX tokens<\/a> will be increased by ten periodic installments of 675,000 SNX tokens to reach the 300 million level before inflation is permanently stopped if SIP-276 is approved by the Synthetix governance community.<\/p>\n\n\n\n

The news was particularly encouraging to the Twitter user “Synthaman,” who wrote: “#SNX is poised to become a scarce commodity with inflation heading to ZERO.” Others are unsure of the long-term implications of SIP-276 for the protocol.<\/p>\n\n\n\n

Delphi Digital, an analyst firm, stated on Twitter that Synthetix would soon stop issuing SNX tokens, making it difficult for the protocol to sustain its present user base and “attract new users with organic revenue in a market where yield is abundant.”<\/p>\n\n\n\n

\n

#Synthetix<\/use><\/svg><\/span><\/a> protocol's token, #SNX<\/use><\/svg><\/span><\/a>, is about to become rare commodity with inflation going to ZERO… pic.twitter.com\/QtqAX1QYtW<\/use><\/svg><\/span><\/a><\/p>— SynthaMan (@SNXified) August 25, 2022<\/use><\/svg><\/span><\/a><\/blockquote>

How a halt to SNX inflation may affect the SNX token price, which is now $3.04, up 10.5% over the last week, and whether decentralized finance (DeFi) protocols<\/a> like Synthetix can draw enough stakes by relying solely on fee revenue, are both unknown.<\/p>\n\n\n\n

Warwick also mentioned that SIP-276 will be formally presented next week and, if approved, will be incorporated into Synthetix's governance structure.<\/p>\n","protected":false},"excerpt":{"rendered":"

If the plan were to be implemented, Synthetix would operate much more like a conventional company by only collecting fees and giving the money to SNX holders. Kain Warwick, the creator of Synthetix’s decentralized finance (DeFi) technology, has proposed a proposal that would stop excessively high yield returns for SNX stakers and set a 300 […]<\/p>\n","protected":false},"author":38,"featured_media":34404,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[10695],"class_list":["post-34400","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-synthetix"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/08\/Synthetix.jpg","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/34400","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/38"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=34400"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/34400\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/34404"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=34400"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=34400"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=34400"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}