Synthetix Announces Release Of “Synthetic” Bitcoin On Top Of The Ethereum Blockchain
Synthetix Announces It Is Launching A “Synthetic” Bitcoin On Top Of The Ethereum Blockchain
The cryptocurrency company Synthetix has announced that it has launched a new “synthetic” Bitcoin on top of the Ethereum (ETH) blockchain. This coin can be used to trade Bitcoin pairs on the Synthetix exchange. The information was released by Finance Magnates on February 25.
New Synthetic Bitcoin Launched On Top Of Ethereum
According to the CEO of the company, Kain Warwick, Ethereum does not have a synthetic Bitcoin working as an ERC-20 token. The new sBTC will be providing real utility to the market.
About it, Mr. Wawrick commented:
“It’s an example of the benefits of the flexibility of a distributed collateral pool of cryptoassets, which will allow us to continue to offer new trading possibilities not offered anywhere else.”
In the past, Synthetix created synthetic fiat currencies and also commodities. With these Synthetic coins, it is possible to increase liquidity, as the company explains. Moreover, they mentioned that it is possible for users to trade in particular cryptocurrencies, fiat currencies, and commodities without owning the underlying asset.
An example of how this works is that users can trade Bitcoins without opening a Bitcoin wallet or holding Bitcoin (BTC). Furthermore, the company says that it removes some risks related to holding virtual currencies since trades do not require counterparties.
Nevertheless, as Finance Magnates explains it would be interesting to see how Synthetix implements a risk management system. CFD providers experienced several issues with managing their trades. Thus, the firm will have to be careful about not being the counterparty of the traders.
In the future, it might be possible for the company to launch other products. The intention is to also provide access to equities and derivatives products.