xAssets are tokenized digital representations of other real-world assets
both digital and real-world in nature that exist on the blockchain.
xAssets
X Asset are derivative tokens providing exposure to a range of assets. They can be traded by leveraging the protocol’s unique pooled collateral model. Trades between X Assets generate a small fee that is distributed to xSynth collateral providers.
xTesla
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xShell
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xGoogle
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xGold
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xYen
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xGoogle
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xBTC
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xApple
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
xUSD
USD PRICE
$ 1.00
Tracks the price of a 1 Bitcoin (BTC). This xAsset always remains constant at 1:1 rate.
- FEE: 0.25%
- LIVE
Understanding Synthetic Assets
The Evolution of Financial Instruments
In the past, government bonds and stock certificates were tangible pieces of paper, and money was backed by gold. Today, these have transformed into digital 1's and 0's on servers, maintaining their traditional roles despite the shift to digital.
The Digital Transformation:
The global shift towards digital resources, such as storage and computational processing, has led to the digitization of real-world assets. Synthetic assets, also known as synths, represent a natural evolution in this process, particularly in the realm of cryptocurrency.
What are Synthetic Assets?
In simple terms, synthetic assets are financial instruments designed to mimic other assets in a different context or for alternative use. They provide unique exposure to these assets for trading purposes.
Traditional Finance Perspective:
In traditional finance, derivatives are commonly used to simulate trading underlying assets, allowing traders to hedge strategies and use leverage. Certain trades involving derivatives are termed synthetic positions, replicating strategies of trading other financial instruments.
Cryptocurrency Perspective:
In the crypto space, synthetic assets encompass not only tokenized representations of real-world assets but also tokens representing other cryptocurrencies on non-native chains. This allows traders to access assets that exist only synthetically on the blockchain.
Types of Synthetic Assets
Synthetic assets in the cryptocurrency space cover a wide range:
- Fiat Currencies:** Stablecoins represent real-world currencies, offering blockchain-based exposure to currencies like the US Dollar or Euro.
- Off-chain Crypto:** Tokens like Wrapped Bitcoin (WBTC) enable trading Bitcoin on platforms like Ethereum or its layer 2 solutions.
- Commodities:** Tokens like PAXG are linked to the price of gold, backed by physical gold. Other commodities like silver and platinum are also tokenized.
- Financial Derivatives:** Similar to traditional finance, crypto now has futures and options offered by both centralized services and decentralized finance (DeFi) protocols.
- Stocks:** Some protocols allow users to trade blockchain-based synthetic versions of stocks, though regulatory compliance remains a concern.
- Inverse Cryptocurrencies:** These tokens move inversely to other cryptocurrencies, providing a way to profit from price movements in the opposite direction.
- Real Estate:** NFTs tokenize real estate, enabling the transfer of ownership on the blockchain.
How Synthetic Assets Work
Synthetic assets are created or "minted" on a blockchain using various methods:
- Centralized Issuance:** Stablecoins are often issued by companies holding cash or cash equivalents to secure the value of their tokens.
- Smart Contract Custodians:** Assets are tokenized on non-native blockchains by having a custodian hold or burn the asset as 1:1 collateral.
- Overcollateralization:** Platforms like Maker require users to deposit crypto assets worth more than the value of the stablecoin being created, ensuring no un-backed tokens.
Synthetic Assets Essentials
In Summary:
- Synthetic Assets (Synths):** Representations of real-world assets, cryptocurrencies, or financial instruments tokenized on the blockchain.
- Examples:** Stablecoins (e.g., USDC), commodities (PAXG), crypto (WETH), financial derivatives (options), and tokens mimicking stocks
- Creation:** Synths are "minted" on the blockchain through centralized issuance, overcollateralization, or smart contract custodians.
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