Decentralized finance (DeFi) protocol Synthetix could potentially burn a significant percentage of its supply if the project goes ahead with a proposal from its founder.
In a new blog update, Synthetix creator Kain Warwick lays out 12 different suggestions or opportunities to move the project forward.
One of Warwick’s 12 Points includes a 3:1 SNX split and a rebuy and record feature. While Synthetix still requires some inflation for incentives and pool liquidity, Warwick says a buy-and-burn feature could still come in handy.
“Even if inflation is the only solution here, I don’t think it denies having a compensatory buy-and-burn force. If we do a 3:1 split, we would have around 90 million additional tokens to buy and burn with a market price of $60 million. Where does the money come from to burn these tokens? Treasury commission yield.
Based on recent performance, the Treasury Board (TC) is earning about $5 million per year, if 100% of this is allocated to buybacks, it would take about ten years to complete. If the trading volume increases in the next few years, this timeline would be significantly reduced.”
Warwick mentioned that the idea is still only conceptual, and nothing has been confirmed by a Treasury Board vote.
Synthetix is a protocol that allows the issuance of synthetic assets for trading on Ethereum (ETH). One of the main platforms powered by Synthetix is Kwenta.io, which enables trading of cryptocurrencies, fiat currencies, and other leveraged assets in a decentralized manner.
Synthetix recently thrown out support for Pepe Coin (PEPE), Sui Network (SUI), Blur, XRP, Polkadot (DOT), Floki Inu (FLOKI) and Injective Protocol (INJ) perpetual contracts (perps). According to the bill, more than 40 perpetrators are now available to negotiate.
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