State of SynFutures Q3 2024

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Key Insights

  • SynFutures V3 facilitated $71.0 billion in trading volume in Q3, maintaining its position as a leading perp DEX.
  • Average daily active addresses increased 58.5% QoQ to 7,788. SynFutures’ increase in average daily active addresses reflects the successful execution of the Base deployment strategy.
  • SynFutures expanded to Base in July. SynFutures quickly became the network’s leading perp DEX and exceeded $380 million in daily volume by the end of Q3.
  • Season 1 of SynFutures’ Oyster Odyssey points program concludes on November 25, 2024. The end of Season 1 suggests a potential token launch may be imminent.

Primer

SynFutures V3 is a decentralized derivatives exchange on Base and Blast, with the deployment on Base occurring on July 2, 2024. In October 2023, the team raised $22 million in a Series B funding round led by Pantera Capital. SynFutures V3 utilizes the Oyster AMM, which integrates features of an onchain order book, moving beyond the traditional AMM model to provide a more dynamic and efficient trade execution framework. With single-token liquidity provision, this permissionless model allows listing pairs with any asset as collateral and enables users to trade any quote asset against any collateral asset. Theoretically, users could pair any combination of assets against each other. SynFutures’ Perp Launchpad further democratizes derivatives trading by enabling anyone to create perpetual futures markets for any asset. In addition, order management, matching, and executions occur fully onchain, unlike alternative models that depend more heavily on offchain controls. As of writing, SynFutures does not have a native token, but Seaspm 1 of its points program Oyster Odysseyy is ending on November 25, 2024, hinting toward a potential token launch.

For the purposes of this report, we will focus strictly on V3 data, as V1 and V2 were deprecated in February.

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Key Metrics

Performance Analysis

Network Overview

SynFutures V3 continues to be an overwhelming success, facilitating over $71 billion in perp trading volume in Q3. SynFutures V2’s all-time cumulative volume was $4.6 billion. Similarly, V2 averaged 950 daily active addresses (DAAs), whereas V3 has grown 58.5% QoQ to 7,788 DAAs in Q3’24. V3’s average daily volume was $772 million in Q3 and peaked at $1.5 billion on July 15. SynFutures’ consistent daily volumes (sans weekends) solidify its user retention and V3’s success.

Focusing solely on SynFutures V3, total unique traders declined entering the quarter following the Blast token launch on June 26, 2024. However, in the second half of July, unique traders increased as SynFutures’ expanded to Base. The sharp decline in unique traders at the end of July through early August corresponds with the sharp decrease BTC experienced when it fell from $70,000 to $49,000. Average daily unique addresses fell 59.9% QoQ from 2,826 in Q2 to 1,132 in Q3.

To promote trading activity in early September, SynFutures introduced several promotional campaigns offering token rewards through SynFutures’ Meme Perp Carnival and MEW trade-a-thon. SynFutures also announced its inclusion in Base’s Onchain Summer campaign on August 29 to promote its expansion to Base earlier in the quarter.

SynFutures’ TVL decreased 44.6% this quarter to $26.5 million. It is primarily comprised of wETH and USDC, which account for 54.6% and 28.3% of TVL, respectively. The sharp TVL decline between July 29 and August 5 corresponds with BTC’s move from $70,000 to $49,000.

SynFutures’ Oyster AMM model combines concentrated liquidity and limit orders. This reduces protocol risk when listing long-tail assets and enhances capital efficiency by requiring only one set of margin to provide liquidity on both sides of the pools. Thus, SynFutures can support large trading volumes with lower capital requirements.

The most traded quote assets on SynFutures are BTC and ETH, accounting for 93.2% of total trades. Q3 averaged 26,278 daily trades, an increase of 5.8% QoQ. In Q3’24, the exchange continued to aggressively list long-tail assets as part of a growth strategy that prioritizes organic community-based tokens over aggressive incentives. Long-tail assets listed as part of this strategy in Q3’24 most notably included DEGEN, MOG, PURR, doginme, and MEW. That said, BTC and ETH remain the platform’s dominant assets.

SynFutures generated $14 million in fees over Q3’24. SynFutures’ fees are defined within different volume tiers:

  • Users whose monthly trading volume is below $100 million receive a 3 basis points (bps) fee;
  • Users greater than $100 million receive a 2.75 bps fee;
  • Users greater than $500 million receive a 2.5 bps fee, and,
  • Users that conduct over $1 billion receive a 2 bps fee.

With SynFutures’ expansion to Base, the team announced the launch of the meme perp summer campaign in which all taker trading fees were reduced to 2 bps.

Ecosystem Analysis

As of Q3, SynFutures established itself as the leading perpetual DEX on Base, significantly outpacing competitors like Avantis, the second-largest perpetual DEX on Base by TVL. At the end of Q3, Avantis achieved $14.5 million in TVL and was recording around $1.4 million in daily volume, while SynFutures’ Base implementation was recording over $380 million in daily volume at the same time, underscoring its dominance. SynFutures demonstrated its adaptability by migrating to Base and adopting a distinctly different user acquisition strategy from its approach on Blast—one that prioritized community engagement over incentive-driven growth. This included listing Base-native meme coins such as DEGEN and doginme to resonate with the local ecosystem and attract engaged users. While the perpetual DEX sector remains highly competitive, with over 90 active platforms, SynFutures’ tailored strategies and focus on community-driven assets continue to solidify its position as a key player in the market.

Qualitative Analysis

In Q3, SynFutures focused on cultivating an organic user base, reducing its reliance on incentives for user acquisition as it expanded to Base. Building on a successful Q2 on Blast, SynFutures leaned into a community-driven approach, prioritizing sustainable growth by listing community-driven meme coins rather than offering aggressive incentives. This approach was highlighted by the Meme Perp Summer, Base Bonanza, and Meme Perp Carnival events, which targeted high-engagement meme coins and provided exclusive trading incentives through Oyster Odyssey (O_O) points to drive user loyalty and community involvement.

Protocol Updates

Throughout Q3, SynFutures continued to refine its platform to enhance user experience, technical capabilities, and cross-chain accessibility. Significant updates across V3.10.2 to V3.10.7 included:

  • New Features: In Q3’24, Synfutures introduced a suite of new features designed to enhance user experience, accessibility, and community engagement.
    Key updates included:
    • Adjust Margin by Leverage: This allows users to adjust the margin of their open positions by specifying their preferred leverage level.
    • Privy Wallet support: This integration expands accessibility with social media login options.
    • Reverse Limit Order Shortcut: Reverse limit orders are now automatically filled by clicking the position value of an open position.
    • Permissionless Listing: This function seamlessly enables users to create perpetual markets for their favorite tokens.
    • Cross Market Mode for Limit Orders: This function enables users to place limit orders beyond the fair price.
    • Scaled Limit Function: This function enables users to place up to 9 limit orders in a single batch within a specific price range.
    • Coinbase Wallet integration: Offers seamless connectivity for Coinbase Wallet users, broadening platform accessibility.
    • Discord Widget Bot: This integration promotes community engagement by enabling users to share trading outcomes across social media platforms.
    • Social PnL Sharing: Strengthens community engagement by enabling users to share trading outcomes across social media platforms.
  • Expanded Asset Listings: The quarter saw new listings, including TRUMP/USDC and HARRIS/USDC perpetual markets based on Polymarket’s presidential election prediction markets. Listing Polymarket’s election markets brought event-based futures to the platform, broadening SynFutures’ reach within DeFi. SynFutures also listed popular meme tokens like MOG, DEGEN, PURR, MEW, and many more, further diversifying trading options and reinforcing SynFutures’ commitment to community-driven assets.
  • Strategic Partnerships: In Q3’24, SynFutures formed several strategic partnerships and integrations to expand its ecosystem, enhance user incentives, and increase visibility.

These partnerships include:

  • Lido Finance Partnership: Lido Finance and SynFutures formed a strategic partnership through the SynFutures Perp Launchpad program, which integrated the wstETH/ETH trading pair on SynFutures.
  • Vooi Integration: Vooi, a cross-chain intent-based perp DEX aggregator, integrated SynFutures, enabling Vooi and SynFutures users to trade and provide liquidity on Vooi while earning O_O easily points.
  • CygnusFi: A stablecoin protocol on the Base, partnered to boost the wcgUSD/USDC perpetual market with up to 10x leverage and O_O rewards, incentivizing user participation.
  • Bifrost Network: An EVM-compatible network providing native cross-chain capabilities to its dApps. Bifrost Network also offers a BTC-backed stablecoin called BtcUSD. SynFutures launched a BtcUSD/USDC perpetual market with up to 10x leverage through this partnership.
  • HashKey: A prominent digital asset service provider in Asia, HashKey partnered with SynFutures to strengthen its regional market presence.
  • Degen: The popular memecoin on Base collaborated with SynFutures to launch the DEGEN/ETH perpetual market, providing incentives like O_O points, trading fee rebates, and DEGEN APY rewards.
  • Turtle Club: A phantom liquidity protocol democratizing liquidity deals across Web3 partnered with SynFutures to offer SynFutures users a 25% boost in Turtle Points and a 30% O_O points boost for new liquidity providers, with added revenue-sharing incentives.
  • Onchain Summer Campaign by Coinbase: A campaign hosted by Coinbase on Base included SynFutures to enhance its visibility in the Base ecosystem.

Closing Summary

SynFutures solidified its position as a leading perpetual DEX in Q3 2024, marked by a strategic expansion to Base. The platform facilitated over $71 billion in trading volume during the quarter, underscoring robust user engagement and the success of its community-focused acquisition strategy. However, this reflected an 18.1% QoQ decline, driven by broader market stagnation as BTC’s price consolidated for much of the quarter. At peak engagement during the quarter, 5,965 unique traders actively participated, highlighting SynFutures’ ability to attract and retain a committed user base despite challenging market conditions. With its successful deployment on Base, enhanced platform features, and a focus on long-term user growth, SynFutures remains well-positioned to expand its presence and influence in the competitive DeFi landscape.

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