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Synthetix Mitigates Risks via Infinex Derivatives, Handling Counterparties Successfully

Synthetix, a leading DeFi project in the cryptocurrency space, has announced plans to expand its range of products with the introduction of a new derivatives front-end called Infinex. Kain Warwick, the founder of Synthetix, shared his intentions to integrate Infinex into the decentralized trading infrastructure of the platform. Infinex aims to cater to both novice and experienced traders by offering features similar to centralized exchanges (CEX), including a non-custodial central limit order book.

Currently, Synthetix operates Kwenta, a decentralized exchange (DEX) for derivatives on the Optimism network. However, Warwick identified three key issues with the existing platform. Firstly, traders are required to bridge their assets to the layer-2 rollup and exchange them for sUSD, Synthetix’s stablecoin used as margin collateral, before they can start trading. This process is seen as inconvenient for users.

Furthermore, each order or cancellation on the current platform incurs a small fee as it requires the trader’s wallet signature. Warwick emphasized the need to eliminate any skepticism regarding the ability of decentralized Perpetuals (Perps) to directly compete with centralized exchanges. By addressing these issues, Synthetix aims to provide a seamless trading experience on its DEX.

Warwick also highlighted the advantages of using a non-custodial decentralized exchange, playfully mocking the now-defunct FTX and other centralized exchanges for their counterparty risks. The collapse of FTX last autumn served as a reminder of the potential risks involved in centralized platforms. Synthetix’s goal is to provide traders with a secure and reliable trading environment, leveraging the benefits of decentralization.

The planned Infinex DEX will cater to traders familiar with platforms like Binance, offering simple access through a username and password while maintaining a non-custodial setup. Each user will be assigned a unique public-private key pair stored locally in the browser, exclusively used for signing trade orders and not for fund withdrawals. This approach ensures the security of users’ funds.

Specific technical implementation details of the Infinex DEX were not disclosed, as they are entrusted to the core developers of Synthetix. However, it is expected that the launch of Infinex will coincide with the release of Synthetix’s version 3 of its perpetual futures trading system, set to occur in the coming months.

The expansion of Synthetix’s product offering reflects the platform’s commitment to innovation and addressing the needs of its users. With the introduction of Infinex, Synthetix aims to attract a broader range of traders, providing them with a user-friendly and secure decentralized trading experience. As the cryptocurrency industry continues to evolve, projects like Synthetix play a crucial role in driving the adoption of decentralized finance and expanding the possibilities of the crypto space.

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