Debt Hedging Strategies
- Active debt is your share of the global debt pool. It is not static; it changes with the composition of the debt pool. View the current debt pool composition at https://staking.synthetix.eth.limo/debt/overview.
- Once you view the composition of the debt pool, you’ll want to take your issued debt (when minting snx) and use it to mirror the composition of the debt pool.
- This is done by buying similar assets to the debt pool on Kwenta. We recommend that you check your debt hedging strategy every week to ensure that you roughly match the composition.
- Ex: If the debt pool is 80% sUSD and 20% sETH, you’d take 20% of your debt and purchase sETH. Now you’re protected from the debt pool increasing
Synthetix has partnered with dHEDGE to deploy a one-click debt mirror index for SNX stakers on Optimism. Read the original announcement or the below write-up to hedge with this easy-to-use tool. With this tool, each staker can hedge their exposure to the debt pool in a few clicks.
All a staker must do is navigate to the Synthetix Staking dapp debt section and purchase the dSNX token through the UI, which is integrated into the ‘Manage Tab.’
1 sUSD worth of debt mirror token will hedge one sUSD worth of debt.
Example: If you have 100,000 of sUSD active debt and purchase 100,000 of the dHEDGE debt mirror index token, it will keep your debt in parity with the debt pool without any outside interaction.
- Synthetix has partnered with dHEDGE to deploy a one-click debt mirror index for SNX stakers on Optimism. Read the original announcement or the below writeup to hedge with this easy-to-use tool.
- With this tool, each staker can hedge their exposure to the debt pool.
- All a staker must do is navigate to the Synthetix Staking dapp debt section and purchase the dSNX token through the UI, which is integrated into the ‘Manage Tab’.
- 1 sUSD worth of debt mirror token will hedge one sUSD worth of debt. Make sure you're connected to Optimism!
- Example: If you have 100,000 of sUSD active debt and purchase 100,000 of the dHEDGE debt mirror index token, it will keep your debt in parity with the debt pool without any outside interaction.
- To withdraw, a user must navigate to https://toros.finance/derivative/dsnx and click the 'Sell' button.
Alternate Hedging Strategies
This is not the only debt hedging strategies, though it is the safest in ensuring that your issued debt will equal active debt when you want to exit the system.
Last modified 1mo ago