Synthetix Perps v2 reaches a new milestone, but here’s the caveat

• The P/S ratio went up while the total value locked on SNX declined.
• Supply outside of exchanges increased but the key metrics looked bearish. 

Synthetix [SNX] witnessed a major surge in its Perps V2 exchange as its daily volume reached $100 million. This indicated an increased number of investors in the network, as crypto traders often use perpetual contracts to earn passive income through funding fees.

$100M daily volume for Synthetix Perps.

Congratulations to the front-ends integrating with Perps to make all of this possible.

❤️⚔️ pic.twitter.com/qrsEK5BiKl

— Synthetix ⚔️ (@synthetix_io) March 9, 2023

Realistic or not, here’s SNX market cap in BTC’s terms

Synthetix Perps V2 recap

Synthetix launched Perp v2 last year, which significantly reduced fees, improving scalability, capital efficiency, and, most importantly, trader satisfaction.

As per the official announcement, Synthetix Perps V2 reduced perps trading fees to only 5–10 basis points, a considerable reduction from Perps V1, while maintaining optimal performance and execution efficiency. An ETH-PERP market became available when Synthetix Perps V2 off-chain oracles launched.

Though SNX Preps v2’s volume registered a massive interest, the network’s P/S Ratio increased.

The P/S ratio is a metric that is used to determine whether an asset is undervalued or overvalued. Therefore, a possibility arises of a price correction of the token, which can lead to a decline in investors’ interest. 

Source: Token Terminal

Not only that, but the current bearish market also played a role in pulling SNX’s price down. As per CoinMarketCap, SNX’s value declined by more than 13% in the last 24 hours.

At press time, it was trading at $2.20 with a market capitalization of over $555 million. The price plummet also negatively affected the network’s value as its TVL went down after a consistent uptick. 

Is investors’ interest in SNX declining?

Even though SNX’s price fell victim to the bears’ movements, investors’ interest in SNX  increased.

Consider this- SNX’s supply on exchanges registered a downtick. However, its supply outside of exchanges went up, which by and large was a bullish signal.

CryptoQuant’s data further revealed that SNX’s exchange reserve was decreasing. Thus, revealing that the token was not under selling pressure, despite the price plummet.

Source: Santiment

How much are 1,10,100 SNXs worth today?

Meanwhile, the network’s on-chain performance raised a few concerns. Thanks to the price decline, SNX’s MVRV Ratio declined considerably.

The network’s social dominance also fell, reflecting its decreased popularity. Furthermore, SNX’s network growth also went down.

Source: Santiment