The cryptocurrency market extended its losses on Thursday, with total market capitalization dipping by 1% to $1.15 trillion. Most digital assets traded in the red as investors remain cautious amid ongoing concerns about the U.S. debt ceiling standoff. Adding to the uncertainty, recent FOMC meeting minutes revealed a divided Federal Reserve on future rate hikes, further dampening investor sentiment.
Bitcoin fell below $26,000 before recovering slightly to trade around $26,400. Key support levels now sit at $25,600 and $25,200, while resistance is seen at $26,650 and $27,300. Ethereum also slipped earlier in the day, dropping beneath $1,770, but has since rebounded to $1,802. Market volatility indicators currently reflect neutral sentiment across the crypto space.
More concerning than short-term price swings is the broader liquidity contraction. Stablecoin supply has now declined for 14 consecutive months—a worrying sign for market health. This shrinking stablecoin market mirrors a form of "quantitative tightening" in traditional finance, according to a Goldman Sachs report earlier this year. Until this trend reverses, sustained recovery in crypto prices may remain elusive.
CCData reports that stablecoin market cap has dropped to its lowest since January 2021, now standing at $40.6 billion. Centralized exchange stablecoin trading volume also plunged by 46% month-on-month to $20.2 billion—the weakest level since June 2022. The decline reflects a lack of breakout momentum in major crypto assets, which continue to trade within tight ranges.
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SNX Among Worst Performers in Recent Market Downturn
Despite broader challenges, Synthetix (SNX) had shown strong momentum earlier in 2025—up over 2023% year-to-date—before recent volatility took its toll. Currently ranked as the 64th largest cryptocurrency by market cap, SNX briefly became one of the biggest losers among top 100 cryptos in the past 24 hours, shedding nearly 9.5%. It now trades at $2.32, with a 24-hour trading volume of $66.4 million.
While Kava (KAVA) saw an 8.5% drop on the same day, SNX’s longer-term performance remains impressive. Over the past two weeks alone, SNX surged more than 65%, outperforming both Bitcoin and Ethereum during that window. However, profit-taking and broader market weakness have led to a 4.8% decline over the past 30 days and a 12% drop over the past year.
Since peaking at an all-time high of $28.53 in November 2021, SNX has lost approximately 92% of its value. Yet it remains far from its 2019 low of $0.35 and has demonstrated resilience with a notable rally in early 2025.
Recent price gains pushed SNX into overbought territory on the Relative Strength Index (RSI), accompanied by surges in trading volume and daily active addresses. However, data shows increased outflows from top holder wallets and rising exchange reserves—signs of profit-taking that likely contributed to selling pressure.
Still, fundamental developments continue to support long-term optimism.
Expanding Utility Through New Asset Listings
Synthetix recently enhanced its platform by adding support for perpetual futures (Perps) on Arbitrum (ARB), tapping into growing demand for cross-chain derivatives. This move increases SNX’s utility as traders use the protocol to gain exposure to high-demand assets—including meme coins—without holding them directly.
The platform now supports Perps on over 40 assets, including XRP, Polkadot (DOT), Sui Network (SUI), Injective Protocol (INJ), Blur, and Floki Inu (FLOKI). These offerings are accessible via integrated DeFi platforms such as Kwenta, Polynomial, Decentrex, and dHEDGE.
This expansion aligns with rising interest in synthetic assets—digital tokens that mirror the value of real-world or crypto-based underlying assets. By enabling leveraged and short positions on trending tokens, Synthetix strengthens its role as a leading derivatives hub in decentralized finance.
Meanwhile, Synthetix’s Total Value Locked (TVL) has nearly doubled in 2025, climbing from $246.36 million to $428.13 billion year-to-date according to DeFi Llama. While still below its 2021 peak of $2.4 billion, the upward trend signals renewed confidence and growing adoption.
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The Role of Synthetix in the Synthetic Assets Ecosystem
Originally launched as Havven in 2017 by Kain Warwick, Synthetix began as a collateral-backed stablecoin issuer. It raised around $30 million through an ICO by selling HAV tokens in 2018. As the crypto market evolved, so did the project: it rebranded to Synthetix to expand beyond stablecoins and focus on creating synthetic assets ("Synths").
Synths are tokenized representations of real-world or digital assets—ranging from cryptocurrencies like BTC and ETH to fiat currencies like EUR and commodities like gold and silver. Users can gain exposure to these assets without owning them directly, thanks to price feeds provided by decentralized oracles.
Built on Ethereum, Synthetix operates as a trustless DeFi protocol where SNX token holders collateralize new Synths by locking their tokens into smart contracts. This mechanism ensures solvency and enables seamless trading across ecosystems.
SNX serves multiple functions:
- Collateral: Required to mint new Synths.
- Governance: Holders vote on protocol upgrades via Synthetix Improvement Proposals (SIPs).
- Rewards: Stakers earn weekly incentives from trading fees and inflationary emissions.
There are currently 317 million SNX tokens in circulation, with a maximum supply capped at 317 million after earlier inflationary phases.
Strategic investments have bolstered confidence in the network. In early 2025, DWF Labs invested $15 million in SNX tokens paid in USDC and committed to purchasing an additional $5 million. As part of the deal, DWF Labs will enhance liquidity across centralized and decentralized exchanges and integrate Synthetix Perps into its trading operations.
Governance Evolution: Kain Warwick’s 12-Point Proposal
A pivotal development emerged this week when founder Kain Warwick introduced 12 strategic governance proposals aimed at guiding Synthetix into its next phase. These suggestions are designed to improve tokenomics, boost community engagement, and ensure sustainable growth.
One key proposal is the "SNX Split and Buyback" plan: a suggested 3:1 token split followed by systematic buybacks using treasury revenues. While inflation remains necessary to incentivize staking and liquidity provision, Warwick argues that buybacks can counterbalance supply growth.
“With a 3:1 split, we’d generate roughly 90 million extra tokens for buybacks—worth about $60 million at current prices,” Warwick explained.
Given the Treasury Committee (TC) earns around $5 million annually in fees, full execution could take up to ten years—if trading volumes remain steady or grow.
Other proposals include:
- Core Contributor Alliance: Reward developers quarterly with SNX to align long-term incentives.
- Trading Incentives: Distribute SNX rewards to boost Perps volume.
- Staker Rewards: Enhance yield programs to strengthen network participation.
These ideas are still conceptual and require formal voting by the four-member Treasury Committee. However, internal support suggests many could move forward.
“TC votes don’t confirm anything yet,” Warwick clarified, “but several proposals already have backing within the council.”
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Frequently Asked Questions (FAQ)
Q: What is Synthetix (SNX) used for?
A: SNX is the native token of the Synthetix protocol. It’s used for collateralizing synthetic assets (Synths), participating in governance via SIPs, and earning staking rewards from trading fees.
Q: Why did SNX drop recently despite strong yearly gains?
A: The dip reflects broader market weakness due to macroeconomic uncertainty and profit-taking after a strong rally. Increased exchange holdings suggest traders cashed out gains.
Q: How does Synthetix generate revenue?
A: The protocol earns fees from synthetic asset trades and Perps activity. A portion flows to stakers; another may fund buybacks under new governance plans.
Q: Is SNX a good investment in 2025?
A: With expanding utility, growing TVL, and active governance reforms, SNX shows strong fundamentals. However, like all cryptos, it carries volatility risk.
Q: What are Synthetix Perps?
A: Perpetual futures (Perps) allow users to take leveraged long or short positions on various assets—like BTC or meme coins—without expiry dates.
Q: How can I stake SNX and earn rewards?
A: Users lock SNX in smart contracts via the official staking dApp or supported platforms like Kwenta. Rewards come from protocol fees and inflationary emissions.
Core Keywords: Synthetix (SNX), synthetic assets, decentralized finance (DeFi), perpetual futures (Perps), Total Value Locked (TVL), SNX staking, governance proposals.