sUSD, Synthetix’s stablecoin, is undergoing a critical phase in preparation for the V3 release, which will result in enhanced decentralization and upgradability.
The previous V2x mechanism encouraged participation by minting the SNX token. It differs from the present version in that it brings in and disburses actual yield, has a buyback and burn system, and prevents SNX circulation.
In the case of the V2x mechanism, sUSD will have the support of various collateral assets, such as SNX, ETH, and others. Moreover, Synthetix V3 simplifies LPing with its structure that includes Synthetix Perps and spot markets.
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The transfer of SNX and sUSD from the V2 mechanism to the new framework will occur soon. Various methods will be applied to initiate the shift, such as added OP incentives for sUSD liquidity on Velodrome and SNX incentives for sUSD liquidity on Curve.
The shifting towards Synthetix V3 will take place with the help of two stages, one being the Ethereum mainnet shifting, wherein SNX stakers on the Ethereum mainnet will have the option of shifting their places to V3. The second will be the Optimism migration, wherein Synthetix V3 will be positioned on Optimism, the shifting reaching Optimism SNX stakers.
According to SIP-306, the migration system provides a transparent infrastructure for SNX and sUSD migrations.
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While the Synthetix V3 shifting process is underway and nearing closure, the priority will be creating an upgradable, decentralized, and strong ecosystem consisting of off-shoot protocols on Synthetix liquidity and framework. The V3 migration represents a critical step forward in achieving the goal and creating an ecosystem complete with developers, traders, and liquidity suppliers for upgrading on-chain off-shoots.
