What is Frax Finance?

📈 Spot trading of FXS/USDT

‍

Frax Finance is a stablecoin protocol bringing stability and prosperity to the blockchain. 

And the Frax Protocol boasts several DeFi features:

• Fraxswap - a time-weighted Automated Market Maker.
• Fraxlend - a permissionless lending market for liquidity providers and lenders.
• Fraxferry - send Frax-based tokens across the blockchain with ease. 

Frax prides itself on being fully decentralized, passing over complete on-chain governance to those active in the ecosystem. 

Currently, on Frax, there are three stablecoins available:

1. FRAX - a U.S. dollar pegged asset.
2. The Frax Price Index (FPI) - the first stablecoin backed against a basket of consumer goods.
3. FraxEther (frxETH) - pegged to ETH for use as a replacement for WETH in smart contracts.

Across these subprotocols, Frax Finance operates on a fractional algorithm and were the first to use this technology. The ratio of FXS token collateralizes FRAX stablecoin’s value.

We cover FXS in more detail below!

If stablecoins are your thing, be sure to give Frax Finance your attention.

‍

The FXS token

Frax not only has three stablecoins but also has a token called Frax Shares or FXS.

The FXS token is a non-stable utility token used alongside the stablecoin FRAX. 

Holders also have the right to govern the protocol. Frax stated, "It is important to note that we take a highly governance-minimized approach to designing trustless money in the same ethos as Bitcoin."

You can stake your FXS long-term to gain governance rights and access to more rewards. 

You earn veFXS, which is a “Vote Escrowed token”. They replicate staked crypto in exchange for governance of a protocol. They are non-transferable or tradeable.

As more FRAX tokens mint, the supply of FXS increases, too. FXS can become deflationary. However, this success depends on whether the demand for FRAX grows.

FRAX and FXS work together further. As the market capitalization grows for FXS, this helps stabilize the price of FRAX. Therefore, staking is vital for this protocol's functionality.

The tokenomics for FXS are as follows:

• 60% – Liquidity programs, farming and community
• 5% – Project treasury, grants, partnerships and security-bug-bounties
• 20% – Team / Founders / Early Project Members
• 3% – Strategic Advisors / Outside Early Contributors
• 12% – Accredited Private Investors

FXS’s market stats:

• Current market cap: $493,685,202
• Circulating supply: 75,280,778 FXS
• Max supply: 100,000,000 FXS
• Twitter: 78,788 followers 
  

Connect with us

Twitter

Facebook

Telegram

YouTube

Risk Warning

Cryptocurrency investment is subject to high market risk. Please make your investments cautiously. Cryptology will make its best efforts to choose high-quality tokens, but will not be responsible for your investment losses. As a digital asset trading platform that respects the community, Cryptology adheres to the principle of truthful, transparent and fair trading, with no malicious intent. We are committed to providing users with a service that is safer, more efficient, and more reliable for the trading of digital assets.

‍