❓FAQ
Commonly asked questions about Solidus Synth.
What is Solidus Synth?
Solidus Synth is the yield maximizer protocol for blue chip fractional synthetic assets, backed by a hybrid collateral model that combines native Layer 1 (L1) or blue-chip tokens with Solidus utility tokens.
Engineered for capital efficiency, composability and yield maximization, Solidus Synth enables users to gain exposure to premium digital assets without the need for over-collateralization. The protocol is designed to deliver double or even triple-digit yields on users' favorite blue-chip tokens, all while preserving full long exposure through zero impermanent-loss liquidity pools.
With built-in yield opportunities, protocol-owned liquidity, and automated peg stability mechanisms, Solidus Synth unlocks a powerful new layer of DeFi utility.
What are synths and synthetic assets?
Synthetic assets or synths are financial derivatives giving its owner exposure to an underlying asset without having to actually hold it. A synth is simply a tokenized asset that mimics or mirrors the value of another asset. E,g. xsAvax is a synth that mimics the price of Avax while being back by a mix of tokens.
Was there a presale?
AVA had no presale. Development and launch of the protocol was self funded by the team.
What is the utility of AVA?
Platform fees from minting/redeeming are distributed to AVA stakers and lockers. AVA is also a critical component in the minting/redeeming of synths as its POL backs a portion of the CR which provides greater capital efficiency for synths while maintaining peg stability.
AVA is also a governance token for the Solidus Money ecosystem.
Are there any fees?
There is a 0.5% fee for minting and 0.5% fee for redeeming paid in Avax, transferred to AVA Stakers and Lockers.
There is a 50% penalty fee in AVA for claiming farming rewards early (before vesting period ends)
What is a Collateral Ratio (CR)?
The Collateral Ratio (CR) determines the current mix of collateral backing each synth token, comprising both the utility token (e.g., AVA) and the underlying Layer 1 (L1) asset. Expressed as a percentage, this ratio is central to the minting and redemption mechanisms.
CR is dynamically adjusted hourly, either upward or downward, based on the asset’s price trend, current demand and forecasts.
Adjustment Logic (based on 60-minute TWAP):
▶️ If TWAP > 1.005 Avax → CR decreases
▶️ If TWAP < 0.995 Avax → CR increases
How can I mint xsAVAX?
xsAVAX can be minted at any time from the dapp UI minting page. Each xsAVAX requires 1 AVAX token to mint and based on the current Collateral Ratio (CR) a portion is made into AVA POL.
For example, when CR is at 90%, to mint 100 xsAVAX 90 AVAX will be deposited into the AVAX pool reserve and 10 AVAX will be converted to AVA/AVAX LP (Protocol Owned Liquidity)
I minted xsAVAX only with AVAX but CR was at 90%. How?
For a seamless UX the minting UI allows you to use only AVAX even if the CR is under 100%. The protocol will automatically buy the needed AVA for you on the open market and use it for Minting process behind the scenes.
How to redeem xsAVAX back to AVAX?
xsAVAX can be redeemed at any time through the dapp UI redeem page. When redeeming a certain amount of AVAX and AVA will be given back to you based on the current Collateral Ratio (CR).
For example, when CR is at 95%: If you want to redeem 100 xsAVAX-> 95% will be returned as AVAX and 5% as unlocked AVA.
How is xsAVAX able to keep peg securely?
xsAVAX can be minted and redeemed by anyone at anytime, creating profit opportunities for arbitrageurs if the price drifts above or below peg. If xsAVAX is below peg profiters can buy it on the open market and then redeem it for AVAX in the UI thereby keeping the price difference as profit. The same works in reverse when above peg.
Read more in Stability Mechanisms
How does the protocol prevent Flash Loan attacks?
Solidus Synth is secure against flashloan types of attacks due to a simple yet effective 2-step minting and redemption mechanism. When minting or redeeming synths users must first input the tokens to mint or redeem in one transaction and then collect the output in a separate transaction. Flashloans by mechanic can only be performed in one transaction so this 2 step process makes any flashloan attack impossible.
What is Protocol Owned Liquidity (POL)?
A portion of AVAX using to mint xsAVAX will be converted to AVA/AVAX LP depending on the current CR. This provides multiple benefits for the protocol outlined here.
Are there any deposit fees to LP farm or stake AVA?
There is no deposit fee on the farms for LPs or for staking AVA. The only fees on the platform are during minting/redeeming synths and early exit vests.
I claimed my farming rewards but now they are gone. Why?
Farmed AVA rewards have a 4-week vesting period. You have to "claim" them to start the vesting process. After "claiming" on the Farm page they will automatically move to the Staking page and are displayed under "AVA in Vesting". You can claim the vested tokens instantly for a 50% AVA penalty or vest for the 4 week period to claim them all. Tokens during vesting continue to earn AVAX from protocol fees while in vesting.
Do I have to wait 4 weeks to get my farming rewards?
If you want to get 100% of your farmed rewards - yes. But you can also claim your rewards during the vesting time with a 50% penalty fee on your vesting rewards. You can either get 50% of the rewards instantly or 100% after the 4 week vesting period. Tokens in vesting continue to earn AVAX from protocol fees while in vesting.
Can I do something with my vesting tokens?
All vesting AVA are counted as staked AVA and will earn AVAX for you from protocol fees.
What do I get for staking my AVA tokens?
Everyone staking AVA will earn AVAX rewards from protocol fees.
Why should I lock my AVA tokens?
Locked AVA tokens will earn all AVA penalty fees from early exit vests in addition to the AVAX rewards from protocol minting and redeeming. AVA lockers also earn a portion of the rehypothecated farming yield the protocol earns that comes in the form of various tokens including additional AVAX, stablecoins and other AVAX protocol reward tokens. Locked AVA can be claimed or relocked after 4 weeks.
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