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Educational Byte: What Are Synthetic Tokens in Crypto Networks?
Description
This story was originally published on HackerNoon at: https://hackernoon.com/educational-byte-what-are-synthetic-tokens-in-crypto-networks.
Synthetic assets in crypto can track gold, stocks, currencies, and more. Discover how they work and what they make possible on-chain.
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Synthetic tokens mimic the price of a referenced asset, such as gold or a stock, but do not represent ownership of that asset. They are created and managed by smart contracts, which use collateral to support the synthetic positions and oracles to provide precise data on the referenced asset's price.