sUSD depeg expands and breaks $0.6! The official offers 5 million SNX rewards to fight for it, is the cure still opium?

Synthetix, a DeFi protocol designed to allow users to create and trade synthetic assets, in response to the sUSD deanchoring crisis, announced later yesterday (18) that 420 Pool was officially launched, aiming to provide high rewards to increase sUSD demand and promote price return to $1 anchor by incentivizing SNX stakers to deposit sUSD. (Synopsis: sUSD stablecoin deanchored 16%: mechanism smashing pot, or a good opportunity to steal the bottom? (Background addition: another stablecoin decoupling!) Synthetix's sUSD plummeted to $0.925 at one point, what happened? Synthetix's stablecoin sUSD, a DeFi protocol designed to allow users to create and trade synthetic assets, has not recovered $1 stability for more than two weeks since it was decoupled at the end of March. Just yesterday (18th), sUSD even fell further below $0.6, just when user panic intensified, Synthetix officially launched rescue measures, allowing sUSD to stand back to $0.8 this morning, but it seems to be temporarily immobile... The following dynamic area takes you through the context of this event. What are the reasons for sUSD decoupling? The beginning of decoupling of sUSD dates back to March 20 this year, when the sUSD coin price fell by single digits, and by early April it fell directly below $0.85, and the sell-off continued to amplify. As for the reasons for the decoupling, one reason is due to the official launch of the SIP-420 proposal, which was passed at the beginning of this year, one of the main points is to reduce the collateral ratio of the original collateralized assets minted sUSD from 500% to 200%, although this scheme is conducive to improving capital efficiency, but it also reduces the stability of sUSD and the market demand has not kept up, resulting in selling pressure on sUSD. How to mint sUSD? Here is an addition to how to mint, sUSD is mainly minted through collateralized assets: The main collateral is SNX, the native token of the Synthetix protocol. In some cases, the protocol also allows the use of other Synths (e.g. sETH, sBTC) as collateral, but ultimately still needs to be traced back to SNX stake. In the early days of Synthetix, ETH was used as direct collateral to support the minting of sUSD. However, at present, the role of ETH has been greatly reduced, and it is mainly used to provide liquidity support or as indirect collateral assets. In simple terms, the stability of sUSD is closely correlated with the price of the SNX token. Although the coin briefly exceeded $25 in 2021, the price has continued to fall since then, and the current $0.62 is now at a 2020 low, which can be said to be quite weak. Synthetix launches 420 Pool to cope with deanchoring As sUSD decoupling becomes more and more serious, Synthetix officially announced through X yesterday (18) evening that it officially launched 420 Pool. According to the official introduction, 420 Pool aims to provide high rewards to increase sUSD demand by incentivizing SNX stakers to deposit sUSD, promoting price return to $1 anchoring, and its core mechanism is: Eligibility: 1) Only existing SNX stakers (already participating in 420 Pool or other Synthetix stakers) can deposit sUSD; 2) New stakers need to wait for the opening of the subsequent phase (Phase 2/3). Deposits & Rewards: Stakers deposit sUSD into the sUSD 420 Pool, locked in exchange for rewards. Reward pool: A total of 5 million SNX per year, approximately 13,698.6 SNX per day, prorated to stakers depositing sUSD. The reward lasts for 12 months and is designed to stabilize the sUSD ecosystem over the long term. How it works: 1) the deposited sUSD is managed by the protocol and is used to provide liquidity (e.g. Curve, Aave pools) or to seek yield opportunities (e.g. sUSDe minting from Ethena); 2) Part of the proceeds is used to buy back SNX or distribute to stakers, enhancing the capital efficiency of the system. Exit mechanism: 1) After depositing sUSD, stakers can withdraw at any time, but need to withdraw SNX or sUSD through a 7-day cooling-off period; 2) Early withdrawal may affect reward distribution, but does not affect the principal amount of existing sUSD. Relevant execution details Launch: April 18, 2025, rewards will be distributed 36 hours after the announcement. Operating platform: Users can connect to the wallet through 420.synthetix.io to check the staking status and deposit sUSD. In this regard, the founder of Synthetix also posted on the X platform: This is the most effective solution at present. Although this move does push sUSD back to $0.8 in a short period of time, it is also a dangerous bet, after all, it also amplifies the selling pressure of SNX, and may even be targeted by giant whales to plan malicious currency price manipulation, whether it can return to the stability of one dollar in the future needs to continue to be observed; At the same time, users are alerted to potential risks. This was the least worst immediate solution available to create demand for sUSD from the cohort of users who are most aligned. Solution came from a user in discord today Also investigating what GHO did with @mavprotocol. — kain.depeg (@kaiynne) April 18, 2025 Related Stories Only "stablecoins" can be airdropped! Eight major projects & Quick overview of participation methods Italian Economy Minister: The potential impact of US stablecoins on Europe far exceeds tariffs, calling for the promotion of digital euro confrontation Learn Sun Yuchen sticks Trump butt to turn over? Binance Chuan "negotiates business transactions with the Trump family" and intends to list WLFI stablecoins (sUSD decoupling expands to break $0.6!) The official sacrifice of 5 million SNX rewards fight, antidote or opium? This article was first published in BlockTempo's "Dynamic Trend - The Most Influential Blockchain News Media".