Synthetix Pushes SNX Stakers to Fix SUSD Depeg

Synthetix Founder Pushes Back: “Fix sUSD or Face the Stick

In the volatile world of crypto, stablecoins are meant to be the calm the storm. But Synthetix’s sUSD, a crypto-backed stablecoin, has been anything but stable in 2025. And now, Synthetix founder Kain Warwick is taking a firm stance against SNX stakers, urging them to take accountability and action or face consequences.

The Depeg Problem

On April 18, sUSD dipped as low as $0.68, marking a nearly 31% deviation from its intended $1 peg, according to data from CoinGecko. While it has recovered somewhat to about $0.77 as of April 21, that’s still a long way from the safety zone.

The root of this instability? According to a Synthetix spokesperson, it’s largely due to "structural shifts" post the SIP-420 launch a major proposal aimed at reshaping how debt risk is managed within the ecosystem. The proposal transferred some of the debt burden from individual stakers to the protocol itself, shaking up how incentives and responsibilities are distributed.

The SUSD 420 Pool: A Fix or a Flop?

In response to the ongoing depeg, Synthetix launched a new staking mechanism called the sUSD 420 Pool on April 18. The idea is simple: SNX holders can lock their sUSD for 12 months and earn a share of 5 million SNX tokens. It’s a high-reward, high-commitment offer.

But adoption has been slower than expected. In a candid post on X (formerly Twitter), Warwick shared his frustration:

• “This is very solvable and it is SNX stakers' responsibility. We tried nothing which didn’t work, now we have tried the carrot and it kind of worked but I’m reserving judgement.”

The “carrot,” in this case, is the SNX incentive. And if that doesn’t work, Warwick made it clear the “stick” is coming.

• “I think we all know how much I like the stick so if you think you will get away with not eating the carrot I’ve got some bad news for you.”

UI Missing, But Pressure Mounts

Currently, the staking process for the sUSD 420 Pool is manual and lacks a user interface (UI) a major hurdle for participation. Warwick acknowledged the UI’s absence but hinted that it’s temporary.

Once the interface goes live, however, expectations will rise. Warwick warned that if stakers don’t step up post-UI launch, the team may be forced to “ratchet up the pressure.” This could potentially mean more aggressive governance proposals or staker penalties.

SNX Stakers: The Backbone of the Ecosystem

Synthetix operates as a decentralized derivatives liquidity protocol, and SNX stakers play a vital role by collateralizing and backing synthetic assets like sUSD. If they don’t support these fixes, the whole model comes under pressure.

• “The collective net worth of SNX stakers is like multiple billions. The money to solve this is there we just need to dial in the incentives,” Warwick said.

The implication is clear: the ecosystem has the resources it just lacks the action.

Learning from Other Stablecoins

Stablecoin depegs aren’t new to crypto. In March 2023, Circle’s USDC fell below $1 after the collapse of Silicon Valley Bank where $3.3 billion in reserves were tied up. Yet it recovered as confidence returned and structural issues were addressed.

Similarly, TrueUSD (TUSD), associated with Justin Sun, saw a drop in January 2025 when major holders swapped out TUSD for Tether (USDT), a dominant player in the stablecoin market.

These cases highlight that recovery is possible, but it requires coordinated action, transparency, and strong incentives something Warwick is aggressively pursuing.

Why It Matters: The Bigger Stablecoin Picture

Stablecoins are no longer niche instruments. They have become a cornerstone of crypto infrastructure, enabling trading, lending, and DeFi applications. According to CoinMetrics and other market trackers, the total stablecoin market cap crossed $200 billion in early 2025, with transaction volumes topping $27.6 trillion surpassing even Visa and Mastercard’s combined processing volume by over 7.7%.

That makes sUSD’s depeg a big deal, not just for Synthetix, but for broader crypto confidence.

The Future of sUSD and L1 Development

Despite the current crisis, Warwick remains optimistic. He emphasized that this issue won’t slow Synthetix down for long.

• “We will start slow and iterate but I’m confident we will resolve this and get back to building perps on L1.”

That suggests future development including perpetual contracts on Layer 1 Ethereum remains a top priority. But it hinges on fixing the current mess first.

Final Thoughts

The message from Synthetix’s founder couldn’t be clearer: sUSD’s depeg is SNX stakers' problem to solve and fast. With the sUSD 420 Pool offering serious incentives and the UI launch looming, Warwick is drawing a line in the sand. Stakers can either act voluntarily now or face the consequences later.

As stablecoins continue to grow in influence and utility, sUSD’s path to stability will be closely watched not just by SNX holders but by the entire DeFi community.

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