Build with Synthetic Asset Tokens at ETHWaterloo

UMA Project
Published in
3 min readNov 4, 2019


Since launching UMA’s “Synthetic Token Builder” on Rinkeby testnet in September at ETHBoston, we’ve seen hundreds of interesting synthetic asset tokens and applications of synthetic asset tokens from the community! We’re looking forward to seeing what builders at ETHWaterloo will come up with.

Synthetic asset tokens are tokens backed by collateral deposited by a “token sponsor.” A token sponsor opens a “token facility,” where they deposit collateral and can then borrow synthetic asset tokens. For more details on how it works, check out our blog post. You can also see the main contract for the synthetic tokens in our Github, with additional documentation here.


We’ll be at ETH Waterloo and will be sponsoring the following prizes:

  • 1,000 DAI to the most creative implementation or use of UMA’s Synthetic Asset Token design
  • 1,000 DAI to the project using UMA’s Synthetic Asset Token design that is most likely to become a mainnet DeFi project with a clear go-to-market strategy

We’ve also collaborated with 0x to offer a joint prize:

  • 1,000 DAI and 1,000 USD of ZRX to the project that has the most innovative use of 0x Instant for Synthetic Asset Tokens built on UMA.

UMA’s Synthetic Asset Tokens are a design pattern for all builders, and we encourage you to use this template to create tokens with your own parameters. Below, we’ve included some examples of what others have built using this template, but our prizes should encourage you to think creatively about what how to design products for adoption.

Past projects:

Here are a few projects that we’ve seen using UMA’s Synthetic Asset Token template. Each project set 2 parameters in the template: price index and margin currency, to enable a creative application.

Select a price index, margin currency, and application
  • SwanDAI @ ETHBoston: A token, margined in USDC, that tracks the difference between the DAI/USDC price and 1 (i.e. how far DAI is trading from its peg).
  • SUMA @ ETHBoston: A token, margined in DAI, that tracks interest rates (for the finance-savvy among you, it is similar to a eurodollar future). For more ideas related to interest rates, check out this thread.
  • BARF @ Twitter: “Bay Area Real Estate Fund” is a token, margined in DAI, that tracks the price of Bay Area housing.

We encourage you to think about how you can leverage these parameters when designing your own tokens. Here are a few ideas (for testnet):

  • Crypto-NYSE: Create an exchange with synthetic tokens that track the price of different stocks on the NYSE.
  • Token Store: Create a storefront for a curated list of synthetic tokens, all in a particular theme (e.g. a “Twitter store” for tokens that track the # of followers different users have).

Contact Us:

To brainstorm additional ideas with us, come find us at ETHWaterloo! You can also find additional documentation here and ask us questions in our Slack.

UMA is a decentralized financial contracts platform built to enable Universal Market Access. Use UMA’s self-enforcing contract design patterns and provably honest oracle mechanism to create your own financial products using standards like ERC20.

Read our whitepapers or reach out on Twitter.