Synths

A synthetic asset, or "synth", is a token deployed on the blockchain, which mimics a pre-determined underlying asset.

Synthetic Asset: a token on the blockchain that can simulate any and all asset classes such as cryptos, commodities, stocks, ETFs, and other financial instruments, but also exotic investments like collectibles.

For the synthetic assets to keep track of the underlying assets, AudaSynth relies on a programmable and centralized entity called "Oracle", which assigns to the synth an accurate pricing model based on a combination of real-time market data and algorithms.

At the beginning the Oracles are an off-chain centralized entity, but AudaSynth's vision is to develop fully regulated decentralized on-chain solutions in order to open programmable finance to third-parties in a legal and safe manner.

Benefits of holding a synthetic token

Synthetics allow the users to expose themselves to a certain price movement without the need to hold the underlying asset. Users can enter a position (long or short) based on their price expectations either for hedging against a certain event or for the purpose of price speculation.

Hedging: taking a position in an asset or investment that reduces the price risk of another position.

Why not just buy the underlying asset? The main and largest advantange of not holding the underlying asset is allowing the user to reduce the fees associated with the asset (for example the management fee associated with a long position in physical gold or a related ETC/ETF).

In addition, AudaSynth charges lower trading fees compared to average synthetic assets competitors, so users can expect lower costs compared to other trading solutions.

Trading Synths

Users can buy Synths on AudaSynth either by performing a so-called "swap" or by placing a more traditional Buy/Sell market order.

AudaSynth will develop more complex trading orders in the future, such as Stop Loss orders.

Users can store their Synths both on AudaSynth platform or directly in their personal wallet on a supported public blockchain (TBA) after submitting a withdrawal request.

Synths does not have an orderbook. Users will mint or burn the tokens while performing their trading activities. Liquidity is guaranteed by our liquidity pools and top notch risk management protocol.

As outlined in the AudaSynth roadmap, starting from 2025 users will be able to withdraw their Synths directly on our private blockchain to unlock further benefits and features.