Synthetix – the derivatives type DeFi protocol announced on Mar 10, the next phase of its development plans for its decentralized exchange. According to the press release, the team has been focused mostly on scaling and ensuring the security of the architecture, having recently released sX v2 (Synthetix Exchange), new crypto synths, crypto index tokens, fee reclamation feature and soon to be up continuous staking rewards. The team now believes that the system is ready to process significant volume and that this upgrade will allow Synthetix exchange to have greater potential than centralized exchanges. So lets see what features enhancements and improvements, this upgrade would give Synthetix protocol.
Introduction Of Traditional Assets Market
The team plans to integrate traditional asset classes trading using Chainlink oracle into the platform in Q2 2020. The Chainlink aided secure data feed is necessary for asset price discovery using multiple nodes and sources. This will unlock large number of new assets, all accessible on a single platform and will allow users to trade across different markets (equity, ETF, indices etc) in a few clicks.
Additional Crypto Synths, Leveraged Synths And Synthetic Futures
The platform will introduce additional crypto assets, powered by asset listing framework in Q1 2020. Further, the Synthetix exchange will bring leveraged future markets in Q2 2020. Synthetix team will initially test leveraged tokens using fiat currencies like the Euro and AUD, the first introduced pair would be of Bitcoin (BTC) tokens, however the functionality would later be expanded to other prominent crypto-assets.
The future leveraged trading will be introduced for other asset classes too, besides the crypto-assets and will be launched in Q3 2020. This will open the possibility for leveraged trading on many different asset classes simultaneously, including crypto-assets, equities, and commodities.
Synthetix exchange will also offer the binary trading option to leverage the liquidity of the debt pool, allowing traders to take large positions without a counter-party. The binary options are financial products which allows users to place predictions on the price of an asset, dependent on the outcome of a “yes or no”. At the time of contract expiration, the price of the underlying asset must be on the correct side of the strike price (based on the trade taken) for the trader to make a profit, otherwise the position will be liquidated and user would lose the invested amount. They are used as hedging instruments and will be introduced in Q3 2020.
Interface Refinements, Mobile Interface And Advanced Order Types
The trading interface on the exchange will be further refined in Q1 2020. The market and assets pages will be added, which will aid in navigation and make information gathering (current orders, history and performance) easier. The trading delegation is also scheduled for launch in Q1 2020 and will be a major UX improvement which will allow mobile interfaces to function without compromising security, however the mobile trading functionality will be launched later.
Currently the Synthetix Exchange (sX) only supports market orders, however the team confirms that more advanced order types such as limit, stop loss, stop limits etc will be integrated in Q2 2020.
Based on their trading volume, the team will offer incentives to traders in the form of SNX inflation sent to weekly pool and distributed accordingly. The feature will be rolled out in Q2 2020.
The team will be given a demo soon from the Optimism team, if satisfied they plan to deploy the layer 2 scaling solution Optimism on Synthetix in Q3 2020. Optimistic Rollups (ORUs) are a simplistic layer 2 scaling solution that allow for a roughly 100x throughput increase compared to the core Ethereum network.
The Synthetix exchange recently introduced Ether collateral, later they will introduce sUSD (synth USD derivative) borrowing against ETH enabling people to trade with USD instead of ETH. Then, DAI/BTC will be launched.
The platform will introduce different trading fees for different asset classes starting from Q2 2020, since fee reclamation mechanism has reduced the risk for front running.
Synthetix Exchange To Get Major Boost
Synthetix Exchange is slated to get a major boost by the end of this year, if implemented properly, this has the potential to turn sX into a major decentralized exchange, dealing with different asset classes and becoming more functional and lucrative than traditional centralized exchanges.