SNX Tokenomics

Definition ∞ SNX Tokenomics refers to the economic model governing the Synthetix Network Token (SNX), a cryptocurrency that powers the Synthetix decentralized synthetic asset protocol. This model involves staking SNX as collateral to mint synthetic assets, earning staking rewards and trading fees in return. It incentivizes participation and secures the protocol’s value.
Context ∞ SNX Tokenomics is a frequently discussed subject in DeFi news, particularly concerning its role in maintaining the stability and liquidity of synthetic assets on the Synthetix platform. The ongoing situation involves continuous adjustments to the reward mechanisms and collateralization ratios to optimize protocol health and user incentives. A key debate often centers on the balance between capital efficiency and system robustness.