TL;DR
- Synthetix’s perpetual markets on Arbitrum have been set to “close-only” mode, prohibiting users from opening new positions or expanding existing ones.
- Synthetix is now focusing exclusively on Coinbase’s Base network, consolidating operations to optimize long-term efficiency and growth.
- The Synthetix Treasury will manage the transition of USDx, essential for markets on Arbitrum, ensuring stability, liquidity, and an orderly migration to Base.
Synthetix, the decentralized perpetual futures trading platform, has made a pivotal decision by disabling the ability to open new positions on its Arbitrum network. This move marks a strategic shift toward consolidating operations on a single network: Base, the Layer 2 solution backed by Coinbase. The decision reflects Synthetix’s commitment to focusing resources on networks with higher growth potential and aligning with its long-term strategy of becoming a leader in the decentralized finance space.
The Numbers Behind the Shift
Last month, Synthetix v3 recorded a trading volume of $274 million on Base compared to $86.2 million on Arbitrum. This stark contrast highlights higher adoption rates, better profitability, and more robust growth potential on the Base network, solidifying the decision to prioritize it. Additionally, Base’s growing ecosystem and Coinbase’s influence have further reinforced its attractiveness as the primary platform for Synthetix’s operations.
Synthetix’s perpetual markets on Arbitrum have been placed in “close-only” mode, allowing users to reduce or close existing positions but not open new ones. This change aligns with Synthetix’s decision to focus on vertically integrating its products rather than operating as a platform distributed across multiple networks, a strategy they see as more efficient and scalable in the long term.
The Synthetix Treasury has begun purchasing USDx, a key asset for perpetual trading on Arbitrum, and funding a wrapper to ensure stability and liquidity during the transition. This approach aims to minimize risks, protect users, and help liquidity providers migrate to Base, where additional incentives will be offered for a limited time. These measures are designed to ensure a smooth transition while maintaining confidence among Synthetix’s users and partners.
Additionally, Synthetix is working on integrating acquired projects such as Kwenta and TLX into a unified native platform. This reinforces its goal to provide a more straightforward, optimized, and appealing user experience by reducing friction and enhancing trading tools. The integration is expected to streamline operations and attract more users to Base.
With this decision, Synthetix aims to strengthen its position as a leader in the decentralized derivatives market, betting on a more efficient approach aligned with its long-term vision. Although the future on Base looks promising, this shift raises questions about the impact on users and projects dependent on the Arbitrum network. Will users embrace this new strategy?
Will this transition be the key to Synthetix’s sustainable success? Only time will tell.
