SynLev: Synthetic Leveraged Assets, built on Ethereum and Chainlink

What is SynLev

Friends, imagine when we trade stocks in the stock market, sometimes we think, "If this stock goes up just a little, I wish I could make more!" or "If this stock drops a bit, I wish I could lose less!" This is the charm of leveraged trading—it amplifies your gains (but can also amplify your losses). However, traditional leveraged trading usually requires a centralized platform, like a broker, which asks for lots of personal information (what we call KYC, Know Your Customer), and your funds are held by the platform, which carries certain risks.

Now, SynLev (project abbreviation: SYN) is like a decentralized "leveraged trading workshop" built on the Ethereum highway, using a tool called an "oracle" (such as Chainlink oracle) to fetch real-world asset prices. Its goal is to let you trade synthetic leveraged assets that mimic traditional leveraged ETFs (Exchange Traded Funds) in a decentralized, non-KYC environment.

Simply put, SynLev allows you to participate in the ups and downs of asset prices on the blockchain in a freer and more transparent way, and with leverage. It already offers leveraged products like 3x ETH/USD.

Project Vision and Value Proposition

SynLev's vision is to provide a "financial playground" in the crypto world, where everyone can play with various leveraged assets. This playground is open and fair, doesn't require you to show your ID, and you don't have to worry about your funds being controlled by a centralized institution. The core problem it aims to solve is: how to provide mature leveraged products like those in traditional financial markets in a decentralized blockchain world, while avoiding the centralization risks and regulatory restrictions of traditional models.

What sets it apart from similar projects is that SynLev's synthetic assets do not require borrowing or fund rebalancing to maintain leverage, making its asset structure more unique and less susceptible to single-point risks. It's as if it has invented its own unique "leverage magic," keeping assets at 100% liquidity at all times. Initially, SynLev focused on crypto and fiat trading pairs, but its long-term goal is to expand to a wider range of assets such as stocks, indices, and commodities—as long as there is a reliable decentralized oracle providing price data, it can be done.

Technical Features

Technical Architecture

The SynLev project is built on the Ethereum blockchain, which means it leverages Ethereum's decentralization and smart contract capabilities. Its core is synthetic leveraged asset pairs, which are minted and burned via smart contracts.

Oracle Mechanism

To ensure that synthetic asset prices accurately reflect real-world market conditions, SynLev relies heavily on "oracles." Oracles are like "information couriers" in the blockchain world, securely and reliably transmitting off-chain (such as traditional financial market) price data onto the chain. SynLev chooses to use the industry-leading Chainlink oracle, which ensures decentralization and tamper-resistance of price data. Chainlink's price data is refreshed based on a set heartbeat frequency (e.g., 1-24 hours) and price deviation thresholds.

Synthetic Asset Mechanism

SynLev's synthetic assets exist in "pairs," such as 3x long ETH/USD (BULL ETH/USD) and 3x short ETH/USD (BEAR ETH/USD). The collateralization method is special: they are collateralized by the ETH required to mint tokens, as well as the performance of the opposing asset and liquidity providers. This means that if you hold a long token, the holders of the short token and liquidity providers are essentially your "counterparties," and vice versa. This design greatly reduces single counterparty risk.

The uniqueness of SynLev assets is that they do not require fund rebalancing or debt. Each asset pair is independent, and dramatic price swings in one pair do not affect the liquidity of the entire system. In theory, there is no cap on the number of assets that can be minted, and assets always maintain 100% liquidity.

Although SynLev aims to provide, for example, 3x leverage, the actual leverage (La) will dynamically adjust based on the equity ratio of the asset pair. Typically, the actual leverage of a 3x asset will not exceed 4.5x or fall below 1.5x. When there is a significant imbalance in equity between the long and short tokens of an asset pair, the system uses reward and penalty mechanisms to encourage users to balance equity, keeping leverage within an acceptable range.

Tokenomics

Basic Token Information

The native token of the SynLev project is SYN. It's like the "share certificate" of this "financial playground."

• Token symbol: SYN
• Issuing chain: Ethereum
• Maximum supply: 100 million SYN

Token Utility

The main use of the SYN token is as a "revenue certificate" for the ecosystem. Users who hold and stake SYN tokens can share in the fees generated by the SynLev platform. These fees come from transaction fees incurred when users buy (mint) and sell (burn) synthetic assets on the platform. Half of the fees are distributed to liquidity providers, and the other half to users who stake SYN tokens. This means that the greater the trading volume on the SynLev platform, the more revenue SYN stakers can earn.

Token Distribution and Unlocking

In the early stages of the project, 10% of SYN tokens were airdropped to LINK and ETH holders. The project also reserved 9.2 million SYN for business development, such as building partnerships or for exchange listings.

It should be noted that SYN is not currently a governance token, meaning holding SYN does not allow direct participation in project decisions. Governance of the SynLev project is centralized.

Team, Governance, and Funding

Team Features

Information about SynLev's core team members has not been disclosed in detail in public sources. However, the project did post job openings in its early days, seeking Solidity developers, web developers, PR/marketing, and business development talent, indicating that the team has needs in both technical development and market promotion.

Governance Mechanism

The governance mechanism of the SynLev project is centralized. This means that major project decisions are not made by SYN token holder votes, but by the core team or a specific entity. For DeFi projects, centralized governance may mean higher efficiency, but it can also bring challenges in transparency and community participation.

Funding

There is no clear mention of SynLev's specific fundraising amount or treasury details in public sources. However, in the early days, all staking fees were allocated to the development fund, and 9.2 million SYN tokens were reserved for business development, which may be used for project operations, partnerships, and marketing.

Roadmap

The SynLev project went through a series of important milestones in 2020:

• August 15, 2020: Released version 1.0 of the "Living Litepaper," detailing the project's concepts and mechanisms.
• September 27, 2020: Deployed the test dApp on Ethereum's Kovan testnet, showcasing core features such as 3x ETH/USD BULL and BEAR token trading.
• October 2020: Launched the soft launch process and introduced the SYN/ETH Uniswap liquidity provider incentive program to encourage liquidity.
• November 2020: SynLev mainnet officially launched, integrated Chainlink oracle, and first released the 3x ETH/USD asset pair.
• December 2020: Released SYN tokenomics, distribution, and sale proposals, and successfully launched the second asset, 3x BTC/USD.
• January 2021: Continued product upgrades and optimizations, such as updating the price calculator and aggregator contracts, and launched new asset pairs like 3x YFI/USD.

There is no clear recent roadmap for future major plans and milestones in public sources. However, from the project's vision, SynLev plans to continue expanding the types of assets it supports, including stocks, indices, and commodities, as long as there is reliable Chainlink oracle data support.

Common Risk Reminders

Friends, although SynLev sounds interesting, any investment comes with risks, especially blockchain projects. Here are some common risks you need to be aware of:

Technical and Security Risks

• Smart contract vulnerabilities: SynLev's core functions are controlled by smart contract code. If there are bugs in the code, it could lead to loss of funds. Even if the project is audited, 100% security cannot be guaranteed.
• Oracle risk: SynLev relies on Chainlink oracles for price data. Although Chainlink is a leading decentralized oracle, if the oracle fails or is manipulated, it could cause synthetic asset prices to be distorted, affecting user assets.
• Ethereum network risk: As a project on Ethereum, SynLev is affected by network congestion, high gas fees, etc., which may impact trading experience and costs.

Economic Risks

• Leverage risk: Leveraged trading is inherently high risk. It can amplify gains, but also losses. In volatile markets, even small price movements can cause significant asset shrinkage.
• Liquidation risk: Although SynLev's synthetic asset mechanism is unique, if the market moves against your expectations, your leveraged position may still face liquidation risk.
• Liquidity risk: Although SynLev claims assets always maintain 100% liquidity, in extreme market conditions or when a specific asset pair lacks liquidity, trading execution efficiency and prices may be affected.
• SYN token value volatility: The value of SYN tokens is affected by market supply and demand, project development, overall crypto market sentiment, and other factors, and is subject to significant price fluctuations.

Compliance and Operational Risks

• Regulatory uncertainty: The global regulatory environment for cryptocurrencies and DeFi is still evolving, and new regulations may be introduced in the future that affect SynLev's operations and compliance.
• Centralized governance risk: SynLev's governance is centralized. This means the project's direction and decision-making power are in the hands of a few, which may lead to non-transparent decisions or misalignment with community interests.
• Project development and competition: The blockchain field is highly competitive, and SynLev needs to continuously innovate and develop to remain competitive. If the project stagnates or better competitors emerge, its market position may be affected.

Please remember: The above information is for reference only and does not constitute any investment advice. Be sure to conduct thorough research and make decisions based on your own risk tolerance before participating in any blockchain project.

Verification Checklist

• Block explorer contract address: It is recommended to search for SynLev (SYN)'s official contract address on block explorers like Etherscan to view token holders, transaction records, etc.
• GitHub activity: Visit SynLev's GitHub repository (e.g., CryptoIcarus/SynLev) to check code update frequency, commit history, issue resolution, etc., to assess project development activity.
• Official website: Visit SynLev's official website (synlev.com) for the latest information and announcements.
• Social media: Follow SynLev's official Twitter (@SynLevDefi) and Telegram (t.me/synlev) to learn about community discussions and project updates.
• Medium blog: Check SynLev's articles on Medium (synlev.medium.com), which usually provide more detailed project updates and technical explanations.

Project Summary

SynLev is a decentralized finance (DeFi) project built on Ethereum, aiming to provide non-KYC synthetic leveraged asset trading services. Through a unique asset collateral mechanism and support from Chainlink oracles, it attempts to replicate the functions of traditional leveraged ETFs in a decentralized environment. Its core value lies in offering users a freer and more transparent way to participate in leveraged trading, avoiding the limitations and risks of centralized platforms.

The SYN token, as the "share" of the ecosystem, allows stakers to share in the trading fees generated by the platform. However, it should be noted that SynLev's governance is centralized, and SYN is not a governance token. The project went through a series of key milestones from late 2020 to early 2021, including mainnet deployment and asset launches, and plans to expand to more asset classes in the future.

Although SynLev provides an innovative way to trade with leverage, as users, we must be clear about the risks involved, including smart contract vulnerabilities, oracle risks, the inherent high risk of leveraged trading, and potential regulatory uncertainty. Before considering participation, be sure to conduct comprehensive due diligence and fully understand all potential risks.

Once again, the above content is only an objective introduction and analysis of the SynLev project and does not constitute any investment advice. The cryptocurrency market is highly volatile, so please make decisions cautiously and research more details yourself.