Synthetix Initiates Push Into Crypto Derivatives

In a blog post published on May 14th, Synthetix revealed it intends to reacquire Derive via a token-based exchange deal. Under the proposed agreement, 1 SNX token will be exchanged for 27 DRV tokens, giving Derive an implied valuation of approximately $27 million.

Community Vote To Decide Fate Of SIP-415 Proposal

The proposed acquisition, titled ‘Synthetix Improvement Proposal (SIP) 415′, is pending approval from both the Synthetix and Derive communities. Token holders from each protocol will vote on the merger in the coming week.

Source: X (@synthetix_io)

If approved, the acquisition aims to integrate Derive’s advanced front-end user interface and real-world asset (RWA) expertise with Synthetix’s robust on-chain derivatives infrastructure.

According to the blog post, this move supports Synthetix’s broader consolidation strategy, which has already included recent takeovers of fellow DeFi platforms Kwenta and TLX.

Kain Warwick, the founder of Synthetix, said the following:

“Reuniting under one banner simplifies our architecture and governance and unlocks the next phase. This is the kids going out to build their own successful startups, and coming back to join the family business.”

Synthetix added on X (formerly Twitter) that the acquisition signals a new era of vertical reintegration, aiming for direct protocol ownership across perpetuals, options, and application-specific blockchains, all of which “already have SNX in their DNA.”

From Lyra To Derive: A Return To Synthetix Roots

Derive, initially launched as Lyra in 2021, is no stranger to the Synthetix ecosystem. The options trading protocol began as a spinoff project, focused on bringing scalable options trading to Ethereum Layer 2 via Optimism.

Source: X (@synthetix_io)

The re-acquisition brings Derive full circle, folding its development and team back into Synthetix’s vertically integrated model.

This strategic realignment also positions Synthetix to better compete with major players in the crypto derivatives space, such as Hyperliquid, Binance, dYdX, and Deribit, the latter of which is reportedly being acquired by Coinbase.

SNX Token Mint & Vesting Plan

To finance the Derive deal, Synthetix will mint up to 29.3 million SNX tokens. These new tokens will be subject to a three-month lockup period, followed by a nine-month linear vesting schedule to ensure alignment and reduce immediate sell pressure.

The price of SNX responded positively to the news, rising 11.5% on the day to hit $0.94 at the time of writing.

However, despite the daily uptick, SNX remains significantly down from its historical peak. According to data from CoinGecko, SNX is still trading over 96% below its all-time high of $28.53, reached in February 2021.

sUSD Depegging Remains A Risk Factor

While the acquisition represents a positive step for the protocol, challenges remain. Synthetix’s native stablecoin, sUSD, experienced a significant depegging event in April, dropping to as low as $0.68 on April 18th. At the time of writing, sUSD has recovered slightly but still trades below its $1 peg, currently priced at $0.93.

This instability has not gone unnoticed. Major South Korean exchanges Upbit and Bithumb recently suspended deposits of SNX due to concerns related to sUSD’s volatility.

These issues pose ongoing risks to the protocol’s reputation and operational stability, even as it aims to build a more integrated DeFi ecosystem.

Synthetix’s Vertical Integration Strategy

Synthetix’s re-acquisition of Derive forms part of a broader effort to vertically integrate its ecosystem, consolidating its position across derivatives, options, and application-specific infrastructure. With SNX at the center of these components, the project aims to streamline governance, improve composability, and strengthen its competitive edge.

Whether this strategy will enable Synthetix to regain market dominance remains to be seen. Still, with its renewed focus on strategic mergers and a strong technical foundation, Synthetix appears poised for a significant chapter in its evolution.