Rethinking DeFi: Can Syncus Lead the Industry Out of Trouble?

During the last boom in the cryptocurrency market, Decentralized Finance (DeFi) was regarded as one of the most revolutionary innovations of blockchain technology. However, this grand vision faces numerous challenges in practice. Due to immature technology or fundamental flaws in economic model design, many DeFi projects ultimately fall into a vicious cycle, making it difficult to avoid failure. In the current market environment dominated by meme and inscription tokens, how can we revive the former glory of DeFi? Syncus may provide a potential solution for this.

Syncus: Reshaping Decentralized Finance Ecosystem

Syncus is a decentralized currency reserve protocol deployed on the zkSync Era network. It is dedicated to the development and promotion of DeFi applications within the zkSync ecosystem and provides liquidity markets for SYNC token holders. The goal of Syncus is to become the core of the zkSync DeFi ecosystem, creating a truly decentralized "bank" that offers users a full range of financial services including lending, collateral, banking services, stablecoins, interest accounts, mutual funds, brokerage, and exchanges.

zkSync Era, as an Ethereum Layer 2 scaling solution, plays an important role in promoting the development of the Ethereum ecosystem with its efficiency, low cost, and strong security. This provides an ideal high-performance platform for Decentralized Finance projects, and Syncus was born in this context.

Breaking the Prisoner's Dilemma: Redefining Game Theory

The core concept of Syncus is to reinterpret the application of game theory in the field of Decentralized Finance. It aims to break the zero-sum game nature commonly found in traditional protocols by designing innovative mechanisms to transcend the prisoner's dilemma, thereby creating an ecosystem where all participants can benefit.

Lessons from OlympusDAO

Before discussing the innovations of Syncus, we need to review the rise and fall of OlympusDAO. OlympusDAO was a pioneering project in the DeFi space, aiming to create a decentralized reserve currency protocol using its native token OHM. Although OlympusDAO addressed the issue of token holder equity dilution to some extent through the ve(3,3) model, its strategy had an inherent flaw in its assumption that staking must be bound, which deviated from the reality.

Syncus's optimization plan

The design philosophy of Syncus aims to create a mechanism where the actions of each participant contribute to the overall benefit of the ecosystem, thereby transcending the traditional prisoner's dilemma. Even in cases of potential competition or opposition among participants, the entire system can still achieve a win-win situation. The strategies employed by Syncus ensure that even in seemingly detrimental actions to the system, the DAO and its long-term stakeholders can still benefit.

In the bilateral game model of Syncus, any sale of SYNC tokens results in a loss for the seller, but benefits stakeholders. At the same time, each transaction brings profit to the DAO, even if the token price remains unchanged. This mechanism attracts more participants to join, forming a self-sustaining ecological cycle.

SYNC Token Economic Model

The tokenomics of Syncus is the core of its mechanism design. SYNC is Syncus's governance token, with a total supply of 4,186,731,698 tokens. As of March 18, the price of SYNC tokens is approximately $0.03071, with a total market capitalization of about $130 million. This economic model aims to ensure that the interests of token holders are closely linked to the long-term success of the entire ecosystem.

Innovative Strategies

Adaptive Tax Strategies

Syncus has implemented a flexible tax system that dynamically adjusts tax rates for sales and staking transactions. During periods of significant market volatility, the protocol will temporarily increase the tax fees for sales and staking transactions to reduce speculative behavior and maintain system stability. During stable market periods, the tax rates will be correspondingly lowered. This adjustment also takes into account the current staking APY, ensuring that the tax policy is fair and proportional to the earnings received by stakers.

Token mechanism supported by the treasury

Syncus introduces a unique mechanism to provide a continuous high APY by growing its treasury. This mechanism combines taxation and treasury distribution to create a new token model. By taxing various operations and using the tax revenue to fund the treasury, it generates actual returns for holders. This design theoretically can create a self-sustaining flywheel effect: high yields attract more demand, leading to increased trading volume, which in turn grows the treasury and generates higher yields, forming a virtuous cycle.

Future Outlook

The success criteria of Syncus is not just the value of the tokens, but the overall value created for all stakeholders. The short-term goal is to increase market share and create value for holders, while the long-term goal is to become a decentralized protocol backed by a treasury. Once a significant market capitalization is achieved, Syncus plans to invest in the zkSync ecosystem and build its own product ecosystem, with the ultimate goal of creating a truly yield-generating stablecoin.

Conclusion

Syncus represents the arrival of a new era in Decentralized Finance, drawing on lessons learned from the past and moving towards a more stable and sustainable future. By innovatively applying game theory, Syncus surpasses traditional prisoner’s dilemma models and proposes a model that is more beneficial for DAOs and their long-term stakeholders. Its transaction taxation and treasury mechanisms encourage individuals to act in ways that benefit the whole, avoiding falling into a vicious cycle.

As more and more innovative DeFi projects emerge, we can expect the market to regain confidence in the DeFi sector, allowing it to shine again in the new market cycle. Syncus's innovative initiatives not only bring new ideas to the DeFi field but also lay a solid theoretical foundation for its long-term development and sustainability.