SNX (Synthetix Network Token) is a prominent digital asset in the cryptocurrency market, with its supply dynamics being a critical focus for investors and researchers. As the core utility token of the Synthetix protocol—a decentralized finance (DeFi) platform for synthetic asset trading—understanding SNX's total supply is essential for evaluating its market value, scarcity, and growth potential.
SNX Token Supply Overview
- Maximum Supply: 273 million SNX
- Circulating Supply (as of 2023): ~147 million SNX (54% of max supply)
Key Details:
- Initial Supply Cap: 100 million SNX (allocated for early adopters and network stability).
- Supply Expansion: Increased incrementally via governance votes to meet demand.
Release Mechanisms:
- Inflation Rewards: New SNX minted to incentivize stakers and network participants.
- Protocol Fees: A portion of trading fees buys back and burns SNX, reducing supply.
- Governance Control: Token holders vote on adjustments to the supply cap.
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Why SNX Supply Matters
- Scarcity: Fixed maximum supply ensures long-term value preservation.
- Sustainability: Controlled inflation aligns incentives without over-diluting holders.
- Decentralization: Community-driven governance determines supply adjustments.
FAQ Section
Q: How does SNX’s inflation mechanism work?
A: Inflation rewards are distributed to stakers who collateralize the network, promoting participation while maintaining controlled supply growth.
Q: Can the SNX supply cap change?
A: Yes, but only through decentralized governance votes by SNX holders.
Q: What happens to SNX tokens from trading fees?
A: A percentage is burned (removed permanently), creating deflationary pressure.
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