Synthetix Drops Its Plan to Acquire Derive After Receiving Strong Backlash

Synthetix dropped its plan to acquire Derive, a decentralized options platform, after receiving strong backlash from both communities.

Synthetix has dropped plans to acquire Derive, a decentralized options platform, following strong backlash from both communities over the proposed terms of the $27 million deal.

The merger involved a token swap that would have seen users receive 27 DRV tokens for each SNX, with a three-month lockup period for the new tokens. The plan, which was open for community feedback over the last few weeks, has faced rejection from both sides.

While some adjustments were proposed — such as removing the lockup for those holding less than one million DRV — forum discussions made it clear that most users didn't see value in the agreement.

Many Derive users argued that their protocol generates more revenue and questioned the benefits of joining SNX under those conditions, especially considering the potential dilution of their assets.

The plan to issue 170 million new SNX tokens to even out the swap, which would have increased the total supply from 330 million to 500 million, was a point of contention. This information was initially left out of public discussions, fueling distrust over a possible diminishment of the value of existing assets.

The deal was part of Synthetix's plans to speed up the development of its upcoming product, a derivatives platform with a CLOB on Ethereum. Project leaders had highlighted Derive's technical expertise and the opportunity to engage with its community.

Derive, originally launched as Lyra within the Synthetix ecosystem, has spent the last few years working toward independence, gradually leaving behind the infrastructure and assets tied to its parent protocol. This distancing included abandoning sUSD as its stablecoin and launching its own perpetual futures product.

Following the cancellation, Synthetix will continue exploring other options to strengthen its decentralized derivatives offering and move forward with the development of Perps V4. Meanwhile, Derive will maintain its current model, operating independently without joining SNX's governance structure or treasury.