Last Updated: 30 August 2022
SNX is the cryptocurrency of Synthetix Network, and it shows a nice increase today. The SNX price has risen by 15%, and the coin is trading at 3.41 euros. What is going on?
SNX price peaks and surges
Of the thousands of cryptocurrencies in our world, SNX is in 60th place in terms of total value. The SNX price has risen by 15%, and it even briefly reached the 3.55 euro mark yesterday.
That seems like a lot, but the fact that this rise is being celebrated can only mean that the crypto market is in a bear market. In February 2021, the price reached its all-time high, SNX was briefly worth 23.54 euros. Since then, the bears have snatched 85% of that.
We can laugh about the current price increase, especially compared to the all-time high, but in a bull market, everyone is a winner. It is all about what you can do in the bear market, which ultimately lays the foundation for being able to rocket in the bull market.
Improvement proposal helps Synthetix with atomic swaps
Kain Warwick, the founder of Synthetix, is working on that foundation, which is how a proposal known as Synthetix Improvement Proposal 120 passed. This allowed the decentralised crypto exchange 1Inch to work with Synthetix’s network via atomic swaps.
Hopefully, you understand most of the terms in the previous sentence, but just to be sure, we’ll explain atomic swaps. These allow users to exchange crypto from, for example, the Synthetix network for coins on other blockchains without incurring high costs. These other coins are called synths, and their value is determined and kept safe by oracles of Uniswap V3 and Chainlink.
So coins are exchanged between different blockchains. The swap is carried out between two entities without the intervention of a third party. The idea is to keep centralised intermediaries such as regulated exchanges out of the process.
Atomic Swaps increase transactions on Synthetix by 700
Apparently, the possibility of atomic swaps has helped the ecosystem to gain more traction. The volume of the decentralised derivatives protocol shot up by 700% after the integration with 1inch.
According to data from Synthetix, by far the majority of trading volume comes from 1inch. The decentralised trading platform processed $2.9 billion worth of volume last week.
Transaction costs are also skyrocketing. In June, Synthetix raked in $1 million a day in transaction costs. At the time, this was four times more than on Bitcoin. SNX could not keep up with that pace. In the end, Bitcoin always has the longest breath.
At the time of writing, the seven-day average of transaction fees on Synthetix is $175,857. This is less than Bitcoin’s seven-day average of $222,651.
Synthetix wants no more inflation
But the ecosystem is not finished yet. Kain Warwick proposed a new proposal SIP-276: it should ensure that there is no more inflation on Synthetix.
If SIP-276 is adopted by the Synthetix community, then ten times 675,000 SNX tokens will be added to the current total supply of 293 million tokens, to reach 300 million. After that, inflation will end indefinitely.
We are curious to see whether this will be enough to shoot the SNX price into space in the next bull run.