In a blog post published on 30 July, Synthetix announced that all synth exchanges have gone live on the Optimistic Ethereum L2. During the initial testing phase, exchanges will be enabled for sUSD, sBTC, sETH, and sLINK, with more cryptocurrencies to be added as the phase progresses.
The testing phase will be used to better evaluate network performance, observe the behavior of users on L2, and gain other valuable insights as additional functionality is rolled out on L2, the company said in the blog.
With more exchanges set to be launched on Optimistic Ethereum, there is a high likelihood they will experience some downtime or even minor outages as new functionalities are deployed. The Optimism network will also likely be upgraded through downtimes several times ahead of the Optimism mainnet launch.
One of the biggest improvements Optimism will bring to Synthetix is a significant reduction in oracle latency. The Synthetix protocol fills trades at prices reported by Chainlink’s decentralized price oracle network. However, high fees on Ethereum L2 can often make frequent oracle updates economically impractical, creating opportunities for frontrunning. On L2, price deviations between oracle updates can be on the same order as an exchange fee, rate effectively eliminating the potential profit from frontrunning.