Synthetix (SNX) gained 190% in one month and 130% in a single day in mid-October 2025, drawing fresh attention to on-chain derivatives beyond DeFi tokens. The move hits traders of perpetuals, protocol treasuries and liquidity providers the most, as they post SNX as collateral or distribute it as rewards. The rally rests on three legs: a new product, fresh incentives and a wider appetite for decentralized derivatives.
Synthetix revealed a perpetual exchange on Ethereum mainnet. The design cuts user friction — trades cost no gas, users can post several kinds of collateral and an off-chain order book feeds into on-chain settlement, CoinMarketCap notes. The team now keeps liquidity on Ethereum instead of pushing it to layer-2 networks.
To spark use, the project opened a trading contest that starts on 20 October 2025 and pays out one million dollars; entrants must stake SNX to mint sUSD, the protocol’s dollar token. At the same time, the decentralized perpetuals sector warmed up — Bitget data put September 2025 open interest at 772 million dollars.
On-chain numbers back the story: in one day 975 new wallets appeared, 2 725 wallets stayed active and 229 transfers topped 100 000 dollars; institutional balances doubled in the weeks before and exchange balances sank to a yearly low of 73.41 million SNX. Spot and derivative volume rose about eight fold.
Institutional flows and on-chain volatility
An Ethereum-based perpetual trading venue is attracting growing institutional interest, offering on-chain settlement and new opportunities for treasuries and market makers. This marks a step forward in adoption, as traditional liquidity providers begin exploring decentralized environments for more transparent and efficient execution.
However, liquidity conditions are tightening. With staking and trading contests locking tokens for several weeks, the number of coins available on the market decreases, leading to wider price swings and sharper movements. While this setup can create lucrative opportunities, it also amplifies volatility and exposes leveraged traders to potential forced liquidations when momentum reverses quickly.
At the same time, regulators are paying closer attention to on-chain derivatives, synthetic assets, and decentralized futures. The upcoming contest launch on October 20, 2025, will serve as a key test — revealing whether institutional demand and liquidity continue to build or whether the market retraces some of its recent gains.
