Amid all the enthusiasm generated by the largest cryptocurrency rally in history, some assets surpassing even the current high-performance market, especially Synthetix (SNX), experienced a large gap that led to the growth of the entire position.

The news of the Coinbase listing in December helped explain a few things. However, at the time of writing, SNX shares have been up more than 225% since mid-December and are currently trading above $ 16.7, cementing their position as one of the most successful symbols of sustained growth.

Apart from the Coinbase effect, the main reason for the increase in SNX prices is the real demand for what Synthetix has to offer, namely synthetic digital assets. So why are these machines causing such a revolt, and why are they being used?

A short story of synthetic origin
Like many other elements in the cryptocurrency markets, synthetic materials came from the traditional financial sector. Synthetics are used to model specific instruments when some important properties change. This gives investors access to the underlying assets without holding them back.

In the cryptocurrency area, tokens are artificial digital representations of other assets, including in the real world, such as stocks, commodities or fiat currencies. Cryptosynthetics can also be used to access cryptocurrencies and tokens. A simple example is some of the “encapsulated” assets used in Ethereum DeFi applications.

Bitcoin Encapsulated Currency (WBTC) has performed well in recent months, indicating an appetite for such assets as it rose from a market value of around $ 1.1 billion in September to $ 4.7 billion on top of Bitcoin’s recent rally as topped $ 40,000 … The latest release of the synthetic version of Monero could help potential investors circumvent restrictions on private currency trading. It gives investors access to Monero (XMR) without having to navigate the current debit, and it also allows Wrapped Monero (WXMR) to participate in various Ethereum-based decentralized financial applications.

Synthetix – the first function of the engine
Synthetix benefits from being the first in the market with a decentralized exchange that also allows users to create synthetic assets known as Synths using cryptocurrencies as collateral. The platform runs on SNX as the parent code. SNX holders can act as collateral for Synths and receive a fraction of the commission paid by Synthetix DEX users. Thus, the SNX token provides real benefits as it encourages users to create Synth on the platform and create added value for the token itself.

Synthetix has grown significantly over the past three months, according to DeFi Pulse, from about $ 500 million at the end of October to over $ 2.3 billion at the time of writing.

While there are Synths that allow traders to speculate in the prices of non-crypto assets such as oil, it is clear that the vast majority of users use Synthetix to access synthetic USD and crypto assets using sUSD, sEther and sBitcoin . the most popular on the platform. According to the Synthetix statistics page, it accounts for over 75% of the total market value of all synthetic substances.

SUSD Synth alone accounts for around 50% of Synth’s total market value, indicating that DeFi users are still interested in stable currencies for trading. However, sUSD is also the most liquid compound that can be traded on central exchanges, including Binance and KuCoin, as well as decentralized Curve and Balancer exchanges.

The most popular pair is sUSD / sETH on the Synthetix exchange, which currently has a daily volume of around $ 10 million. Despite this, the number of resellers using the platform is very small, averaging around 130 in the last 30 days. This indicates a high concentration of liquidity.

Source: CoinTelegraph