Synthetix V3 has been efficiently deployed on Ethereum Mainnet and Optimism after a radical safety audit from Open Zeppelin, Iosiro, and Macro. Although that is actually an enormous milestone for Synthetix, it must be thought-about a starting and never a conclusion. We’ll be progressively enabling performance and rolling out upgrades from right here, as Synthetix has too many real-world concerns that may’t be anticipated in a laboratory setting.
First off, I need to to acknowledge the superb work of all of the Core Contributors. Guaranteeing that Synthetix remained safe via the unprecedented market circumstances of 2022, rolling out a brand new implementation of perpetual futures markets earlier this yr (which has already seen over $300 million in quantity whereas averaging virtually delta-neutral for liquidity suppliers), and getting Synthetix V3 so far have all been main accomplishments. I’m continually humbled by the expertise of everybody contributing.
So, what’s it precisely? Synthetix is a protocol (a collection of open supply good contracts) that may be deployed on blockchains and built-in with decentralized oracle networks to create an “API for liquidity”. This liquidity can be utilized by markets, carried out with good contracts, to create derivatives collateralized by ERC-20 tokens.
Whereas use circumstances for crypto-native property are nonetheless in comparatively early phases of improvement, the utility of derivatives is plain. (The scale of the marketplace for derivatives is estimated in orders of magnitude upwards of the trillions.) The query is whether or not it’s attainable to create derivatives which can be safer and scalable via engineering larger decentralization into the programs that energy them—just like the web—somewhat than much less.
This diagram offers a high-level overview of the Synthetix V3 structure:
Zooming out, the migration plan entails the power for the Synthetix V3 system to again the Synthetix V2 system by way of the “legacy market”. Liquidity suppliers within the V2 system will be capable of drop their place into the V3 system with a single transaction and proceed to collateralize the present spot synths and perpetual futures markets.
The V3 deployment doesn’t have any markets connected to it but, so presently its main performance is producing a collateralized debt place as a dollar-denominated stablecoin that shall be utilized in built-in markets. We will start to deploy tooling and analytics associated to debt positions instantly. The legacy market has accomplished audit and our spot market implementation will enter audit tomorrow. Since Perps V2 has shipped, improvement will start on perpetual futures markets built-in instantly with V3. Synthetix’s governance, Core Contributors, and broader group are contemplating one of the best sequencing and timeline for the roll out of those markets.
Along with markets, cross-chain performance and scaling will grow to be a spotlight of the Core Contributors in future upgrades of the V3 core system. We’re ready to combine with Chainlink’s CCIP for cross-chain stablecoin transfers and have already accomplished some profitable transfers throughout testnets. Ideally, we can implement an answer for cross-chain pool synthesis (like that of V2) by counting on an ERC-3668 compliant resolution for cross-chain reads. This, paired with our deployment tooling, will enable us to create a layer of liquidity that spans throughout an arbitrary variety of chains (together with L1s, L2s, L3s, and appchains).
As we put together to open up the system for integrators, you can begin constructing instantly. Use the Synthetix Sandbox to spin up a neighborhood improvement atmosphere for front-end or good contract improvement. You possibly can construct an integration with our spot market implementation or construct your personal market implementation for spot synths, perpetual futures, insurance coverage, sports activities betting, choices, or anything. You may also construct integrations with the setPoolConfiguration() operate to automate how a pool ought to distribute its liquidity throughout markets. Liquidity provisioning amongst swimming pools could be automated with the delegateCollateral() operate. See the documentation for extra data.
If you happen to’re constructing on Synthetix V3, tag me within the #dev-portal channel on the Synthetix Discord server or discover me at ETHDenver. I’m excited to see what creativity will come from the DeFi group.