About Synapse Protocol (SYN)

Synapse Protocol is a cross-chain automated market maker (AMM) and an asset bridge. The protocol operates as a universal cross-chain communication infrastructure that allows users to swap assets between independent blockchains and layer-2s.

The platform has a native token, SYN, that’s used to reward liquidity providers/transaction validators and confer voting rights within the SynapseDAO.

Synapse combines a powerful multichain asset-bridge with a series of “stableswap” AMMs deployed on each integrated chain to ensure assets are transferred efficiently with minimal price slippage. 

Per documentation, the Synapse Network, a decentralized collective of validators, actively responds to new on-chain events and directs the corresponding liquidity to its intended destination. Synapse utilizes a new validation paradigm, multi-part computation (MPC) to securely transfer assets between ecosystems. Once confirmation of a new event is received, the protocol AMMs work to transform the liquidity into assets native to the destination chain.

Key to this functionality are two cross-chain tokens. nUSD and nETH; their capabilities allow Synapse to swap assets between independent networks.

 Each time a new cross-chain stablecoin/ETH swap is initiated on the platform, Synapse’s AMMs automatically convert the funds to nUSD/nETH which is bridged to a new destination chain of choice. Once there, an AMM works to swap the nUSD/nETH for tokens native to that new chain.

 Synapse hopes to expand this functionality to more assets through a “canonical minting mechanism” capable of transforming single chain tokens into multi-chain “xAssets” that can be sent, received, stored and utilized across multiple blockchain ecosystems.

Looking forward, Synapse is currently in the process of developing their own native Proof-of-Stake (PoS) blockchain which will serve as a hub for cross-chain DEXs, lending protocols and derivatives markets, documentation explained.

 On May 5, 2022, the platform officially launched support for cross-chain non-fungible tokens (NFTs) through a partnership with DeFi Kingdoms.

Synapse is currently integrated with Ethereum, Optimism, Arbitrum, Avalanche, Polygon and BNB Smart Chain, among other networks.

When was SYN created and how much was it worth?

Synapse has no listed founder/co-founders. Governance is currently controlled via the SynapseDAO, a decentralized band of SYN token holders who propose and vote on changes to the protocol.

Prior to 2021, Synapse was known as Nerve Finance, a BSC Smart Chain-based AMM designed for low-slippage stablecoin trades. Nerve Finance was officially rebranded to Synapse in August of 2021, marking a shift in the protocol’s core business model.

Synapse’s native token, SYN, was initially released via airdrop alongside the rebranded protocol on August 28, 2021. Price data from CoinGecko shows that SYN began trading at about $1.06, consolidating around that mark for roughly one month before catapulting to a record high of $4.92 in October 2021. The token’s price has been impacted by ample volatility (both upside and downside, but mainly the latter) since.

How is the price of SYN determined?

According to project documentation, SYN is a deflationary asset with a hard cap of 250 million tokens. Some 155 million tokens (62% of supply) were initially distributed to eligible wallet addresses via the SYN genesis airdrop, while all remaining supply is earmarked for transaction validators and liquidity providers in the form of tokenized rewards.

As of mid-July 2022, the protocol was issuing around 262,000 new reward tokens each week. SYN’s current circulating supply is 185 million.

Why does SYN have value?

Synapse exists at the forefront of the multi-asset bridge space, offering fast, easy, inexpensive swaps across nearly 15 supported platforms, Messari’s Nick Garcia explained. The more users who seek out Synapse to bridge assets, the greater the store of SYN value.

Is SYN secure?

Synapse utilizes cross-chain multi-party computation (MPC) validators operating with threshold signature schemes (TSS) to ensure high levels of security.

 Click on this twitter thread for a more detailed explanation. 

What are the main benefits of SYN?

•  Synapse enables Web3 users to swap assets between independent blockchain ecosystems.
•  Synapse is integrated with a series of leading blockchain platforms and layer-2 solutions including Ethereum, Optimism, Polygon, Arbitrum, Avalanche and BSC Smart Chain.
•  Synapse offers fast cross-chain swaps.

What do critics say about SYN?

That it’s facing stiff competition. A write up by DACM CEO Richard Galvin notes that there are – at this current moment in time – upwards of 40 interoperability/bridging protocols offering similar utility to Synapse. While the space has a great deal of promise, whether SYN can carve a market niche remains to be seen.