Synthetix and the Merge

Synthetix and the Merge

In preparation for the Ethereum merge event, expected to take place on 15-September, SIP 271 was approved which suspends all Synthetix contracts on both Ethereum and Optimism, when Total Terminal Difficulty (TTD) crosses 58740000000000000000000, around 3 hours prior to the expected merge block and resume activities after ensuring that Chainlink feeds and the rest of the protocol is in a stable state.

The SNX token and synth assets will still be transferrable, but all other parts of the protocol, such as synth exchanges, futures, loans, staking (claiming, mint, burn), and bridging will be suspended. Once the suspension is complete, communications will be made on all proper channels, and all protocol partners will be informed.

Any open positions on Synthetix will stay open during the suspension, but users won't be able to interact with their positions while the system is suspended. To be clear, no positions will be closed due to the system-wide suspension, but users will not be able to interact with their open positions during this time. Please keep this in mind with any open positions.

Suspension of Contracts

The system would be suspended by running the following functions on both ethereum and optimism:

Checks Before un-suspending the Synthetix System

The following checks would be performed on a forked chain (with canon) before unsuspending the system:

  • Minting and burning debt can take place normally, with the debt pool oracle in line with size of debt
  • Both atomic and non-atomic exchange tests would be performed to ensure that the outputted amounts are reasonable
  • Test on opening new loans with ETH and repaying that loan to release the ETH
  • Test on opening futures positions, modifying that position and closing that position to release the margin
  • ETH and LUSD can be wrapped and released

Due to protocol external dependencies, additional checks would be performed:

  • All Chainlink oracles configured within Synthetix are pushing prices that are within a reasonable margin from centralized exchange prices or off-chain calculated expected prices
  • LUSD price is close to 1$
  • renBTC price is close to the price of wBTC

Once the Synthetix Network on PoS chain is unpaused, if the PoS chain, bears a chain id different from 1, then the PoW chain will be subsequently unpaused.

Any questions?

Read SIP-271 for more information regarding the System Wide Suspension

If you have any questions or comments, please join the conversation on Discord.