The Ultimate Guide to Protocols on Arbitrum

## What Is Synapse (SYN)?

Synapse (SYN) is an interoperability protocol designed for safely and securely sending arbitrary data between blockchains.

Its users can transfer and swap their assets across many different chains, including [layer 1](https://coinmarketcap.com/alexandria/glossary/layer-1-blockchain), [layer 2](https://coinmarketcap.com/alexandria/glossary/layer-2) and [sidechain](https://coinmarketcap.com/alexandria/glossary/side-chain) ecosystems. 

The project aims to improve inter-blockchain compatibility by helping its users move their assets between different networks more efficiently. In order to securely transfer its users' assets to and from different ecosystems, while maintaining slippage, liquidity pool balances, and transaction prices, Synapse uses a stableswap algorithm.  

The Synapse ecosystem is made up of six parts: the Synapse Bridge technology, the cross-chain AMM, aggregative cross-chain communication, the SYN token, the Synapse Chain, and optimistic security approaches.

With Synapse’s generalized messaging system, any arbitrary data can be sent across chains in a secure and seamless way. Applications no longer have to be separately deployed across multiple blockchains; they can be deployed on a single chain and communicate with other chains to create the exact same user experience from one central application layer. Generic message passing also includes smart contract calls, enabling smart contracts on different chains to easily interoperate with one another.

Synapse Bridge allows users to seamlessly swap on-chain assets across 15+ EVM and non-EVM blockchains in a safe and secure manner. The bridge supports two types of bridging: Canonical Token Bridging — bridging of wrapped assets across chains; Liquidity-based Bridging — bridging of native assets across cross-chain stableswap pools.

Synapse Chain is an Ethereum-based optimistic rollup designed to serve as a sovereign execution environment for cross-chain use cases. Synapse Chain will offer developers a generalized smart contract interface for building natively cross-chain use cases by leveraging Synapse’s cross-chain messaging system. Applications built on Synapse Chain will be able to execute their business logic across any blockchain.

Synapse supports multiple EVM-compatible blockchains and is integrated with nearly 18 layer-1 and layer-2 chains, including [Ethereum](https://coinmarketcap.com/currencies/ethereum/), [Optimism](https://coinmarketcap.com/currencies/optimism-ethereum/), [Arbitrum](https://coinmarketcap.com/coins/), [Harmony](https://coinmarketcap.com/currencies/harmony/), [Avalanche](https://coinmarketcap.com/currencies/avalanche/), [Polygon](https://coinmarketcap.com/currencies/polygon/), [Moonbeam](https://coinmarketcap.com/currencies/moonbeam/), [Fantom](https://coinmarketcap.com/currencies/fantom/) and [BNB Chain](https://coinmarketcap.com/alexandria/article/what-is-binance-smart-chain). 


## Who Are the Founders of Synapse?

Synapse, which is based in Singapore, doesn’t list its founders, co-founders, or team members. However, the core team is active on Twitter, and their account names are AureliusBTC, Socrates0x, Caesar0x, and Trajan.

In March 2022, Max Bronstein joined the protocol as COO. Bronstein was part of the crypto startup Dharma, where he was involved in building the first [DeFi](https://coinmarketcap.com/alexandria/glossary/defi) lending markets. He was also one of Coinbase’s earliest investors, and helped develop the platform itself.

Synapse is the rebranding of Nerve Finance, the first stableswap [AMM](https://coinmarketcap.com/alexandria/glossary/automated-market-maker-amm) on the BNB Smart Chain ([BSC](https://coinmarketcap.com/alexandria/article/what-is-binance-smart-chain)). In August 2021, the project rebranded to Synapse Protocol and modified its business model, but it kept its key investors, including Three Arrows Capital, CMS Holdings, Alameda Research, Immutable Capital, Primitive Ventures, DeFiance Capital and Mechanism Capital.

Synapse’s community governs its protocol through a decentralized group of SYN holders - called the Synapse [DAO](https://coinmarketcap.com/alexandria/glossary/decentralized-autonomous-organizations-dao). Community members steer the protocol’s development by voting and taking part in governance activities.


## What Makes Synapse (SYN) Unique?

Synapse Chain is built as an Optimistic Rollup, this offers the following benefits:

**EVM Compatibility:** Synapse Chain will leverage the EVM to ensure composability with the rich developer and application ecosystem built around it. Not only will building applications on Synapse Chain match the developer experience of existing EVM blockchains, but existing decentralized applications can easily be deployed to Synapse Chain with little to no architectural changes. This ensures that Synapse Chain can bootstrap a vibrant ecosystem of cross-chain applications from its earliest days.

**Security:** While blockspace designed for more granular use cases can dramatically increase throughput, fees, and overall user experience, it often does so at the expense of security. Instead of needing to bootstrap independent security systems, optimistic rollups enable dapps to leverage the security and decentralization of Ethereum’s base layer, which has the highest security spend out of any generalized smart contract blockchain.

**User Experience:** Rollups offer throughput and scalability that is orders of magnitude higher than that of Ethereum. Transactions on Synapse Chain will be near instant and will cost a fraction of what they would on competing base layers, ensuring applications built on Synapse Chain can foster a user experience akin to that of centralized competitors.

**Simplicity:** Optimistic rollups provide a construction for an execution environment that is both simple and secure. By borrowing from Ethereum’s battle-tested infrastructure, Synapse Chain does not have to re-engineer new features from scratch. To that end, Geth will be Synapse Chain’s client software, meaning Synapse Chain is as close to Ethereum under the hood as possible. Adhering to Ethereum’s core design principles helps minimize new attack vectors that come with creating a new execution environment from scratch.


## Related Pages:

Read about [Curve DAO Token (CRV)](https://coinmarketcap.com/currencies/curve-dao-token/) and [Mobius Money (MOBI)](https://coinmarketcap.com/currencies/mobius-money/).

Learn more about [Uniswap (UNI)](https://coinmarketcap.com/currencies/uniswap/), [SushiSwap (SUSHI)](https://coinmarketcap.com/currencies/sushiswap/), and [PancakeSwap (CAKE)](https://coinmarketcap.com/currencies/pancakeswap/).

What is an automated market maker (AMM)? Find out with the [CMC glossary](https://coinmarketcap.com/alexandria/glossary/automated-market-maker-amm).

Get all the information you need about the crypto industry with [CMC Alexandria](https://coinmarketcap.com/alexandria).


## How Many Synapse (SYN) Coins Are There in Circulation?

Synapse (SYN) is the platform’s native token, which powers the entire ecosystem. The token has a maximum supply of 250,000,000 coins, with a total supply of 192,696,599 coins. As of March 2023, there are 139,773,376 SYN in circulation.

The platform’s tokenomics focus on rewarding SYN users who participate within the ecosystem. The two cross-chain tokens that users can exchange between networks are nUSD and nETH. 

SYN tokens serve a number of different functions, including:

**Governance**. SYN holders can access network services and vote on changes to the platform via the Synapse [DAO](https://coinmarketcap.com/alexandria/glossary/decentralized-autonomous-organizations-dao), helping to steer the platform in a positive direction. 

**LP incentives and rewards**. The network gives liquidity providers rewards for helping the ecosystem grow and for helping to run and maintain its cross-chain features. 

**Staking**. Validators can stake SYN tokens and receive rewards;

**Fees**. Users can pay for gas fees, including cross-chain swap fees, transaction protection fees, and [smart contract](https://coinmarketcap.com/alexandria/glossary/smart-contract) interaction fees using SYN tokens. 

How Is the Synapse Network Secured?

Synapse’s optimistic verification is inspired by Celo’s Optics protocol.

The security models of most bridges today can be characterized in three ways: Locally verified — only parties involved in a given cross-chain interaction verify transactions; Natively verified — all validators of the two blockchains involved in a transaction verify the message; Externally verified — an external validator set is used to verify transactions between chains

Even with these three main archetypes for cross-chain verification, most bridges today still effectively operate as basic multi-sig consensus schemes in order to create a faster user experience. While these systems are useful for fast finality, that speed comes at a cost, exposing users to security threats. As espoused in the Interoperability Trilemma, certain tradeoffs are inherent in cross-chain communication. Trading security for speed has resulted in a multitude of bridge hacks totalling well over $500 million USD in cumulative funds lost.

Optimistic verification borrows from optimistic rollups in that transactions are assumed to be honest by default with a network of off-chain actors responsible for submitting fraud proofs during the course of an optimistic window to disallow any fraudulent transactions. This mechanism adds a significant layer of security to the network, making it far more costly for a bad actor to conduct an attack versus the existing M of N mechanism. Externally verified networks rely on an honest majority assumption whereas optimistic verification relies on a single honest verifier assumption. Optimistic verification just needs one honest guard to behave honestly for the system to remain secure. Rather than a bad actor needing to co-opt M number of validators, that actor would need to co-opt all N actors, and the cost to attack the network becomes unbounded as the number of N fraud watchers increases. Naturally, the added security requires a trade-off - here, latency.

There are four off-chain actors responsible for security of Synapse’s optimistic verification mechanism: Notary — responsible for signing merkle root on each supported chain and bonding SYN behind attestations; Broadcaster — responsible for forwarding updates from home contracts to replica contracts; Guard — responsible for observing cross-chain messages and submitting fraud proofs when detecting malicious state updates; Executor — responsible for posting the final transaction once the latency window is completed


## Where Can You Buy Synapse (SYN)?

As of March 2023, Synapse (SYN) is listed on well-known crypto exchanges like [Binance](https://coinmarketcap.com/exchanges/binance/), [Coinbase Exchange](https://coinmarketcap.com/exchanges/coinbase-exchange/), [Kraken](https://coinmarketcap.com/exchanges/kraken/), [KuCoin](https://coinmarketcap.com/exchanges/kucoin/), [SushiSwap](https://coinmarketcap.com/exchanges/sushiswap/), [PancakeSwap](https://coinmarketcap.com/exchanges/pancakeswap-v2/), [Gate.io](https://coinmarketcap.com/exchanges/gate-io/), [Huobi](https://coinmarketcap.com/exchanges/huobi/), [Uniswap](https://coinmarketcap.com/exchanges/uniswap-v3-arbitrum/), [Bitget](https://coinmarketcap.com/exchanges/bitget/), [BKEX](https://coinmarketcap.com/exchanges/bkex/), [LBank](https://coinmarketcap.com/exchanges/lbank/), [MEXC](https://coinmarketcap.com/exchanges/mxc/), [Phemex](https://coinmarketcap.com/exchanges/phemex/), [CoinEx](https://coinmarketcap.com/exchanges/coinex/), [BitMart](https://coinmarketcap.com/exchanges/bitmart/), [Bitrue](https://coinmarketcap.com/exchanges/bitrue/), [BTCEX](https://coinmarketcap.com/exchanges/btcex-exchange/), [XT.COM](https://coinmarketcap.com/exchanges/xt/) and more.

Want to keep track of Synapse (SYN) price live? Download the CMC [mobile app](https://coinmarketcap.com/mobile/).

Get the latest crypto news and education with the [CMC Alexandria](https://coinmarketcap.com/alexandria).

Take a closer look at [web 2.0 vs web 3.0](https://coinmarketcap.com/alexandria/article/web2-vs-web3).

Synapse

Trust Wallet

MetaMask

Binance Chain Wallet

Ethereum

Shiba Inu

Chainlink

UNUS SED LEO

Uniswap

Pundi X (New)

Delysium

iExec RLC

COTI

Keep Network

Renzo

Alephium

Smooth Love Potion

ATOR Protocol

Spot

CHAD FROG

Calcium

X2Y2

Wibx

Convex Finance is a DeFi protocol that allows Curve liquidity providersto earn a share of trading fees on Curve without staking liquidity there. Instead, LPs can stake with Convex and receive boosted CRV and liquidity mining rewards. This provides CRV stakers with better capital efficiency and positions Convex Finance as an important player in the Curve wars.

Convex has entered a competitive race to obtain as much control as possible of the Curve Finance stablecoin exchange. The more CRV tokens a protocol has, the more influence it has over interest rates on Curve, which is the largest DEX in the world by TVL. Consequently, the “Curve wars” are an ongoing race for influence over what is probably the most important protocol in DeFi.

Convex Finance

Liquity

MAGIC is the utility token that connects gaming communities in the Treasure Metaverse: a decentralized NFT ecosystem which sits on Arbitrum, one of Ethereum’s Layer 2 scaling solutions.

MAGIC is a cross-game currency that connects games, players, metaverses, and communities, all within Web 3.0. The token was launched in September 2021 so its community could buy and sell in-game NFTs on Treasure. It also acts as a reserve currency for Treasure’s metaverse.

Players can earn MAGIC tokens by gaming, mining, and participating in Bridgeworld, Treasure’s flagship game. Treasure now hosts twelve other games on its platform, some of which allow you to use and generate MAGIC tokens like in Bridgeworld. These include Beacon, a free-to-play fantasy action rogue-lite RPG; and Realm, a world-building and exploration game.

Treasure

Stargate Finance (STG) is an omnichain-native asset bridge designed to solve the blockchain trilemma, which says that no blockchain can be decentralized, secure, and fast simultaneously. It does this by simplifying cross-chain DeFi transactions, which lets users transfer and swap their assets between different blockchains, layer-2 networks, and decentralized applications (dApps) almost instantly.

Stargate users can also move their assets between different liquidity pools on various decentralized finance (DeFi) protocols and dApps. The protocol supports transfers between eight chains: Ethereum, Avalanche, Polygon, Metis, BNB Chain, Arbitrum, Optimism and Fantom.

The platform offers several other, profit-making features: users can supply liquidity pools, stake assets, and farm tokens. When users stake their assets, they can help govern the Stargate Finance Exchange.

Stargate Finance

The Frax Protocol is the first fractional-algorithmic stablecoin system. Frax is open-source, permissionless, and entirely on-chain – currently implemented on Ethereum (with possible cross chain implementations in the future). The end goal of the Frax protocol is to provide a highly scalable, decentralized, algorithmic money in place of fixed-supply digital assets like BTC. The protocol incorporates the following concepts:

Fractional-Algorithmic – Frax is a unique stablecoin with parts of its supply backed by collateral and parts of the supply algorithmic. The ratio of collateralized and algorithmic depends on the market's pricing of the FRAX stablecoin. If FRAX is trading at above $1, the protocol decreases the collateral ratio. If FRAX is trading at under $1, the protocol increases the collateral ratio.

Decentralized & Governance-minimized – Community governed and emphasizing a highly autonomous, algorithmic approach with no active management.

Fully on-chain oracles – Frax v1 uses Uniswap (ETH, USDT, USDC time-weighted average prices) and Chainlink (USD price) oracles.

Two Tokens – FRAX is the stablecoin targeting a tight band around $1/coin. Frax Shares (FXS) is the governance token which accrues fees, seigniorage revenue, and excess collateral value.

Before Frax, stablecoins were divided into three different categories: fiat collateralized, overcollateralized with cryptocurrency, and algorithmic with no collateral. Frax is the first kind of decentralized stablecoin to classify itself as fractional-algorithmic ushering in the 4th and most unique category.

Frax Share

Radiant Capital

GMX is a decentralized exchange (DEX) for trading perpetual cryptocurrency futures with up to 50X leverage on popular cryptocurrencies like BTC, ETH and more. The platform launched in September 2021 as Gambit Exchange. To date, GMX has a total trading volume of over $130B and 283K total users, making it the leading derivatives DEX on Arbitrum and Avalanche.

GMX runs on the Arbitrum and the Avalanche blockchain. These ecosystems are connected to the exchange via Synapse — a cross-chain bridge.

Gains Network

Galxe is the world's leading Web3 credential data network and was launched on April 28, 2022, on Binance Launchpool.

Galxe is built on open and collaborative infrastructure that allows Web3 developers and projects to profit from credential data by building better products and communities.

Data curators are rewarded when users employ their credentials in Project Galaxy's Application Modules, Credential Oracle Engine and Credential API at the same time.

Galxe

Mask Network is a protocol that allows its users to send encrypted messages over Twitter and Facebook. It essentially acts as a bridge between the internet and a decentralized network running on top.

Mask Network was initially launched in July 2019, with its first use case of allowing Facebook and Twitter users to encrypt posts on the social media platforms. It then raised $2 million in a funding round in November 2020, co-led by HashKey and Hash Global, and a further $3 million funding round in February 2021 with participation from Digital Currency Group and Fundamental Labs.

Now, Mask Network offers the ability to fund Gitcoin grant campaigns directly from Twitter, as well as plans to offer peer-to-peer payments and decentralized storage functionality. It is a decentralized portal that also allows users to use DApps like crypto payments, decentralized finance, decentralized storage, e-commerce (digital goods/NFTs) and decentralized organizations (DAO) over the top of existing social networks without migrating, creating what is referred to as a decentralized Applet (DApplet) ecosystem.

Mask Network

Smart contracts often struggle to access dependable data, but application programming interfaces (APIs) have been touted as a solution to this problem.

API3’s stated goal is to allow decentralized versions of APIs to be built, managed and monetized at scales. As blockchain technology plays an ever bigger role in the economy — from decentralized finance to supply chain management — the team behind this project says it has never been more important for smart contracts to provide “timely, reliable real-world data.”

The whitepaper for API3 was unveiled in September 2020 and set out the main problem that’s associated with APIs at present: connectivity. At present, there’s no way for smart contracts to establish a direct connection with APIs for the latest data — and this has led to an explosion in the popularity of oracles.

Although this has helped solve the problem to some extent, the industry has since been grappling with the “Blockchain Oracle Problem.” Oracles are a form of middleware that sit in between APIs and smart contracts — increasing costs and centralization. API3 intends to get around this problem by enabling API providers to operate their very own nodes.

API3’s token went live at the start of December following on from a token sale that generated tens of millions of dollars.

API3

Radworks

Synthetix is building a decentralized liquidity provisioning protocol that any protocol can tap into for various purposes. Its deep liquidity and low fees serve as a backend for many exciting protocols on both Optimism and Ethereum. Many user-facing protocols in the Synthetix ecosystem, such as Kwenta (Spot and Futures), Lyra (Options), Polynomial (Automated Options), and 1inch & Curve (Atomic Swaps), tap into Synthetix liquidity to power their protocols. Synthetix is built on Optimism and Ethereum mainnet. The Synthetix Network is collateralized by SNX, ETH, and LUSD, enabling the issuance of synthetic assets (Synths). Synths track and provide returns on the underlying asset without requiring one to directly hold the asset. This pooled collateral enables an array of on-chain, composable financial instruments backed by liquidity from Synthetix. Some of the most exciting upcoming releases from SNX are Perps V2, which hopes to enable low-fee on-chain futures trading through the usage of off-chain oracles, and Synthetix V3, which aims to rebuild the protocol to achieve its earliest goal, being a fully permissionless derivatives protocol. Learn more about Synthetix on their blog or by joining the SNX Discord.

The platform aims to broaden the cryptocurrency space by introducing non-blockchain assets, providing access to a more robust financial market.

Synthetix

Ethereum Name Service (ENS) is a distributed, open, and extensible naming system based on the Ethereum blockchain. ENS converts human-readable Ethereum addresses like john.eth into the machine-readable alphanumeric codes you know from wallets like Metamask. The reverse conversion -- associating metadata and machine-readable addresses with human-readable Ethereum addresses -- is also possible.

The goal of Ethereum Name Service is to make the Ethereum-based web easier to access and comprehend for humans - similar to how the Internet’s Domain Name Service makes the internet more accessible. Like DNS, ENS also uses a system of dot-separated hierarchical names called domains with domain owners fully controlling their subdomains.

ENS launched with a highly successful retroactive airdrop in November 2021 that rewarded users who had registered addresses before the project launched its token. However, in February 2022, it faced criticism over apparently homophobic tweets by its director of operations.

Ethereum Name Service

Lido DAO is a decentralized autonomous organization (DAO) which provides staking infrastructure for multiple blockchain networks.

Most notably, the platform provides a liquid staking solution for Ethereum, allowing users to stake their ETH and receive stETH (Lido staked ETH) tokens in exchange, which represent the user's staked ETH and staking rewards.

Lido DAO is secured by a mix of decentralized governance, audited code and smart contracts. The Lido protocol runs on Ethereum with help from smart contracts that process user deposits and distribute staking rewards, among other functions. Several third-party security firms have audited Lido’s smart contracts in order to identify and address potential vulnerabilities.

The platform’s native token is LDO - which also serves as the governance token for Lido DAO. Holders can participate in governance proposals and vote on key decisions such as board adjustments, new integrations and platform updates. LDO holders have the right to determine the development and operation of the platform.

Lido currently supports staking for Ethereum and Polygon only with the recent sunsetting of Solana.

Lido DAO

Balancer is an automated market maker (AMM) that was developed on the Ethereum blockchain and launched in March 2020. It was able to raise a $3M seed round by Placeholder and Accomplice. Balancer protocol functions as a self-balancing weighted portfolio, price sensor and liquidity provider. It allows users to earn profits through its recently introduced token ($BAL) by contributing to customizable liquidity pools.

To learn more about this project, check out our deep dive of Balancer(https://coinmarketcap.com/alexandria/article/what-is-balancer.

The protocol operates a few types of pools:

Private pools give the owner governance over the pool, and make the person the sole contributor of liquidity to the pool. Also, all the parameters are mutable by the owner.

Shared pools are for those who want to become liquidity providers (LPs). The LPs are rewarded with the Balancer Pool Tokens (BPTs).

Smart pools are similar to private pools but are controlled by a smart contract. They also reward using BPTs and allow anyone to contribute liquidity to the pool.

Balancer

Celer is a blockchain interoperability
protocol enabling a one-click user experience accessing tokens, DeFi, GameFi, NFTs, governance, and more across multiple chains. Developers can build inter-chain-native Dapps using the Celer Inter-chain Messaging Framework to gain access to efficient liquidity utilization, coherent application logic, and shared states. Users of Celer-enabled dApps will enjoy the benefits of a diverse multi-blockchain ecosystem with the simplicity of a single-transaction UX, all from a single chain.

Celer Network

Rocket Pool is a decentralized Ethereum staking pool offering up to 4.33% APR for ETH2 staking. Users can join the Rocket Pool with its decentralized node operator network or run their own nodes with only 16 ETH. In the latter case, they can earn a commission from staking ETH and earn additional RPL rewards from providing RPL collateral, amounting to up to 6.36% APR for ETH and the additional RPL rewards.

Rocket Pool provides liquid staking, meaning users benefit from an increasing exchange rate instead of adding on to their initial staked collateral, which would be a taxable event. Furthermore, Rocket Pool offers smart nodes: a custom node software allowing anyone to run a node on its network. With losses from bad nodes distributed across the network, individual users minimize their risk of facing penalties. This is supported by the pool’s open-source and audited smart contracts, which guarantee fully non-custodial staking and a maximum degree of decentralization.

Rocket Pool

SKALE, described as a modular blockchain network, is designed to bring scalability to Ethereum. SKALE is the only blockchain network capable of running an unlimited number of fast, on-demand, pooled-security Blockchains with zero gas fees to end users. These individual chains are known as SKALE chains and can be dapp-specific or shared.

The project’s website says it wants to enable people to build and run DApps in a “decentralized modular cloud built for real-world needs and configured for your requirements.” This emphasis on decentralization isn’t at the expense of security.

According to SKALE, those who build on this platform can run Solidity smart contracts “thousands of times faster at a fraction of the mainnet cost” — with games and content streaming services among the projects that already take advantage of its infrastructure.

SKALE

Metis is an Ethereum Layer-2 scaling solution aiming to solve the blockchain trilemma: that blockchains cannot be decentralized, secure, and scalable simultaneously. It also strives to solve Ethereum's biggest challenges: speed, cost and scalability.

Metis wants to help developers create and manage existing decentralized applications (dApps), while also supporting developers and entrepreneurs who want to build and launch new dApps. It also integrates the Decentralized Autonomous Company (DAC) framework into its Layer 2 infrastructure to help developers and businesses move from Web 2.0 to Web 3.0.