How to buy Synthetix Network token online
This guide explains the things you need to know before you invest in Synthetix Network. We explore what the Synthetix Network is and what SNX tokens are, and we also detail how to buy Synthetix and where to buy SNX tokens.
Compare where to buy Synthetix, and open an account
If you want to buy Synthetix Network tokens right now, follow one of the links to a recommended broker below. If you need to learn more about cryptocurrencies before getting involved, check out our crypto courses. Otherwise, keep reading to learn about Synthetix.
What is Synthetix?
Synthetix is two things: a cryptocurrency exchange, and a facility for users to ‘mint’ their own virtual tokens on the Ethereum blockchain, which are known as ‘synths.’ SNX is the platform’s native token.
When users first use Synthetix, they purchase SNX tokens and use them as collateral to create their own synthetic assets. These synths are pegged to the value of what users choose them to represent in the real world, and they can then be traded on the Synthetix Exchange. Users can gain exposure to any asset in virtual form, including synth currencies like sUSD (USD), synth cryptocurrencies like sBTC (Bitcoin), synth stocks like sTSLA (Tesla), and synth commodities like sAu (gold).
The real advantage of Synthetix is that it allows users to gain exposure to any investment class they want without having to sign up to a centralised body. However, users are unable to redeem the dividends that might be paid by directly owning certain stocks. The platform is designed to make investing flexible and accessible for all, and investors can even take up a short position by using an ‘inverse synth’ like iBTC, which will gain value when Bitcoin (BTC) falls in price. In short, Synthetix is an all-in-one cryptocurrency exchange solution.
How does Synthetix work?
Synthetix works by using cryptocurrency as a means to make investing and trading more accessible and convenient. The Ethereum-based exchange is an ecosystem populated with user-created synths that track the price of their real-world representation by using something called Chainlink. Synths are exchanged within the Synthetix Exchange: a peer-to-peer marketplace that combines the best components of cryptocurrency – decentralisation and flexibility – with a robust platform that has familiar exchange mechanisms and market dynamics.
To ensure the platform remains liquid, a problem also tackled by other crypto exchanges like Uniswap, Synthetix incorporates a staking mechanism that rewards users for staking SNX tokens to provide liquidity to the exchange. Synthetix also tries to prevent the marketplace from becoming unstable, because to mint a synth, users must stake 750% of the worth of their synths in the form of SNX. This acts as a buffer against major market price swings, though users can expect to see this rate adjusted in the future.
How to buy SNX online – step-by-step guide
Step 1. Find an exchange to buy SNX
As far as where to buy SNX, a cryptocurrency exchange is a good option. Choose a recommended service from the top of our page or check out the two exchanges below. These are two of the best places to buy SNX tokens.
- Binance: As one of the biggest cryptocurrency exchanges, it comes as little surprise that you can conveniently buy SNX through Binance. Open a Binance account and buy SNX today >
- ChangeHero: Offering access to over 40 of the top cryptocurrencies, ChangeHero features a clean, user-friendly interface that you can buy SNX through. Open an account with ChangeHero to buy SNX by clicking here >
Step 2. Sign up and fund your account
To use an exchange, you will usually need to sign up and pass an identity verification test. Have a copy of some photo ID to hand. Once this check has been passed, you need to fund your exchange account. You can often use fiat currencies, but you can also use cryptocurrencies. For example, you could buy some Bitcoin from Coinbase and transfer them into the account on your preferred exchange.
Step 3. Buy SNX
Your account should now be fully set up and funded and you can get started buying SNX. If you are funding your account with fiat currency, such as USD, look for the SNX/USD pair on the exchange. If you’re using Bitcoin, look for the SNX/BTC pair.
Step 4. (Optional) Get a suitable wallet
To enhance the security of your Synthetix Network tokens, especially if your plan on holding them for an extended period of time, you should consider opening an SNX wallet, which functions just like a Bitcoin wallet. You can transfer your SNX tokens from an exchange into a wallet for an added layer of security. Wallets can take the form of online platforms, but they can also be hardware. We’ve saved you some time by listing two of the best wallets that support SNX below.
- CoolWallet: CoolWallet is a Taiwan-based crypto hardware wallet that supports all ERC20 tokens, including SNX. Open a CoolWallet today and start storing your Synthetix securely >
- Trezor: Trezor is an increasingly popular hardware wallet that supports SNX tokens. It is one of the most secure methods of storing your SNX. Check out Trezor and store your SNX today >
How to trade SNX – step-by-step guide
Step 1. Find a broker
To trade SNX effectively, you will need to react to fluctuating market conditions by opening and closing positions quickly. Online brokers allow this to be done easily. However, before you choose a broker, make sure it supports SNX trading. As SNX is not one of the largest cryptocurrencies, not every broker will support it. Plus500 and eToro are two of the largest brokers around, so if anywhere is going to support SNX, these are your best bet.
Step 2. Deposit money
Fund your account with fiat currency (like USD, GBP, and EUR) and use this to trade crypto. One important point of note is to watch out for trading fees; these can quickly add up if left unmonitored.
Step 3. Decide how you’d like to trade
When you start trading, you need to decide exactly what sort of strategy you want to use. There are numerous different methods to gain exposure to the price of SNX, such as spread betting and contracts for difference (CFDs), and you also need to consider whether you want to use leverage: this allows you to gain more exposure to SNX with less initial capital investment, but the risks are just as large as the potential rewards. Steer clear of using leverage if you are a beginner.
Step 4. Start trading
Now your trading has been finalised, you can start trading SNX. However, before you jump in with both feet, we recommend starting with a demo account so you can learn the basics of SNX trading without putting real money on the line.
When trading SNX, you can choose to go long or go short. A long position is when you invest in the belief that an asset (SNX) will go up in value. Going short (or shorting) is when you invest your money in the belief that an asset will reduce in value. Both can be profitable ways of trading Synthetix.
Make sure that before you start trading you are fully aware of any potential risks. Trading SNX can be lucrative and exciting, but it can also be a risky pastime if you don’t pay close attention to your trades.
No rush. It is always prudent to take your time when considering a new investment. Here are some of the pros and cons of Synthetix to help you make your decision.
- Synthetix diversifies the options for exchanges in the crypto world
- Users can gain exposure to centralised assets without their own investment being centralised
- High levels of liquidity with zero slippage
- Opens the market to international markets with no censorship or restrictions
- Extremely complex smart contracts
- Central control points in the development of the system
- 750% collateral is substantial
Still unsure? Here are three more things to consider before you decide to invest in Synthetix Network tokens.
1. Is now a good time to buy SNX?
The answer to this question depends on whether you want to invest in SNX for the long term or short term. In the long-term, as the adoption of cryptocurrencies increases, the Synthetix Network could become an increasingly important service both as an exchange and as a synthetic asset creator. If Synthetix does grow in stature, the value of SNX tokens will also increase.
If trading SNX in the short term is more of a preference, the long-term outlook for Synthetix is not as important. Instead, you should focus on gaining a full understanding of technical indicators so you can form a great technical trading strategy and trade SNX profitably.
For the most recent analysis of Synthetix and SNX, check out one of our articles below:
2. What problem does SNX solve, and what are its investment prospects?
SNX evolves cryptocurrency exchanges into a much more diverse platform. It allows users to invest in almost anything by using cryptocurrencies, and opens up the market for universal access by combatting censorship.
In the future, as cryptocurrencies become increasingly popular, the service provided by the Synthetix Network could grow in popularity because it allows users to gain exposure to centralised assets with a decentralised investment. It will be interesting to see how the lack of potential dividends affects the long-term growth of Synthetix.
To read about the latest news concerning Synthetix and SNX, check out one of the links below:
3. Do you want to hold SNX for the long term?
Buying and holding SNX for long periods of time requires certain actions and considerations, as does trading it in the short term. These are outlined below.
Considerations for a long term investment strategy
If you believe that Synthetix is on target for significant growth, you should consider purchasing some SNX tokens from an exchange and storing them in a wallet to speculate on long-term price accretion. If this is the option you want to go for, make sure to conduct extensive due diligence on Synthetix before taking the plunge. Focus on the business fundamentals of Synthetix.
Considerations for a short term trading strategy
If you would prefer to trade SNX over a shorter timescale for accelerated results, sign up to a reliable broker to trade SNX and focus on technical analysis. If you can spot a trend as it unfolds, you could be onto a winner.