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How do these synthetic assets implement tracking the original asset price? Are the assets still subject to the swings of the general crypto industry (e.g. BTC c
by uh_uh 5y ago
How do these synthetic assets implement tracking the original asset price? Are the assets still subject to the swings of the general crypto industry (e.g. BTC crashing pulls sGOOG down as well even though Google's real stock appreciates)?
- drdrey 5y agoFor a protocol like Synthetix, I believe it uses price feeds provided by Chainlink. In principle, you can always redeem a token like sGOOG for the current price of GOOG on the regular stock market. In practice, there is some risk that an asset could lose its peg. https://docs.synthetix.io/litepaper/#synth-pegging-mechanism https://docs.synthetix.io/litepaper/#synth-pegging-mechanism