Synthetix, a decentralised finance, DeFi, protocol created for synthetic cryptocurrency assets is renowned as one of the major building blocks of DeFi on the Ethereum network.
The protocol on Thursday, 24th announced that there would be a debt pool synthesis feature on the platform, and the release of the feature will be completed that same day. After the announcement, the feature went out that very evening, at about 9pm UTC.
The feature is expected to have an effect on staking participants in two different categories on the platform. These categories are debt hedging and the SNX inflationary staking rewards.
The company running the platform has previously mentioned that they have intentions of transitioning into a new protocol, Optimism-native protocol. In fact, a major board member emphasised his support for this by stating the potential for vast growth of the Optimism protocol.
The DeFi protocol is currently running pools that cut through two different Ethereum chains which are the layer-scaling solution optimism and mainnet. These two chains have garnered a cumulative total-value-locked of $157 million and $930 million, respectively.
The merger of the debt pools L1 and L2 is a major upgrade among the many upgrades done this week within the Synthetix ecosystem. The major way that this merge is going to be done is through Chainlink oracles.
The Chainlink oracles will be used as the major consensus component for the overall debt accumulation. So, according to the company, all the total debt for the issued synths or synthetic assets is calculated off the blockchain. Then, the value calculated is put back on the blockchain through the use of the Chainlink’s oracle network that’s decentralised. This network is read by all the Synthetix contracts present on the L1 and L2.