SNX is the governance and utility token for the Synthetix derivatives platform.
SNX is a low-cap asset that represents the blockchain`s native currency or monetary fee used to execute transactions on the network. This asset is exposed to the underlying risks of Synthetix, a protocol rated as Watch out.
SNX has a fixed supply.
SNX is highly correlated to the overall market.
SNX is the utility, governance and revenue-sharing token for the Synthetix ecosystem. Stakers receive a portion of swap fees on the Kwenta decentralized exchange for trading Synths. SNX is the primary asset used to mint Synths, which are created by staking SNX tokens and maintaining a minimum 400% collateralization ratio. Token holders can also partake in the protocol's governance process to vote on proposals and protocol-level changes through its three DAOs (protocolDAO, grantsDAO and synthetixDAO).
SNX launched with an initial supply of 100M tokens. These tokens were allocated with 60% distributed to investors, 3% reserved for bounties and marketing incentives, 5% for partnership incentives, 12% to the foundation (vested quarterly for 12 months), and 20% to the team and advisors (vesting quarterly for 24 months). Subsequently, a new monetary policy introduced an inflationary supply into perpetuity to reward active stakers. However, the most recent proposal from founder Kain Warwick proposed to reintroduce a capped supply of 300M tokens as the protocol no longer needed inflation to bootstrap network demand. This signals a widespread shift of protocol's seeking to limit inflationary rewards to users in favor of more sustainable yield generated from protocol revenue.
SNX collects 0.3% of all trading fees on its Kwenta exchange and distributes its proportionally to SNX stakers. SNX is also required to mint Synths and users must maintain a minimum collateralization ratio of 400% in order to continue claiming weekly fees and protocol rewards.