Expanded Synthetix Loans
Synthetix expanded the #Synthetix loans feature & added #ETH and #renBTC loans on Staking dApp.
Loans are important as an onboarding option for Synth traders, as well as being a convenient source of extra sUSD for SNX stakers to manage their staking positions, since sUSD can be in high demand across the DeFi ecosystem, particularly around the fee period snapshots.
Liquidation risk
When loans are taken out in a different asset type to its collateral (e.g. sUSD against ETH), there is a partial liquidation mechanism for loans that fall below the liquidation ratio (currently 130%). Liquidators (i.e. any person or bot paying attention) can liquidate a loan when the collateral value drops below the liquidation ratio, incurring a 10% fee from the liquidated amount that goes to the liquidator as reward.
What is Synthetix?
The Synthetix platform enables the creation of on-chain synthetic assets (Synths) that track the value of assets in the real world. Some examples of assets that the platform supports are synthetic fiat currencies (sUSD, sAUD, sKRW, etc.), synthetic commodities such as gold (sXAU), as well as more complex assets such as equity indices.
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