What Is Frax Share (FXS)?
Frax Share (FXS) is the governance and value-accrual token of Frax Finance, a pioneering fractional-algorithmic stablecoin protocol. Unlike traditional stablecoins, Frax combines collateralized and algorithmic mechanisms to maintain stability while maximizing scalability and decentralization.
Key Features of Frax Protocol
Dual-Token System:
- FRAX: A stablecoin pegged to $1 through dynamic collateralization.
- FXS: The governance token that accrues protocol revenue and voting power.
Hybrid Stability Mechanism:
- Uses Chainlink oracles for accurate USD pricing.
- Adjusts collateral ratios dynamically via market arbitrage.
- Multi-Chain Availability:
Supports Ethereum, BSC (Binance Smart Chain), Avalanche, Polygon (MATIC), and Fantom.
How Frax Maintains Its Peg
Minting & Redeeming:
- Users mint FRAX by depositing $1 worth of value (collateral + FXS).
- When redeemed, FXS is reissued.
Arbitrage Opportunities:
- If FRAX > $1, traders profit by minting and selling.
- If FRAX < $1, redeeming restores equilibrium.
Decentralized Governance:
- FXS holders vote on key parameters (e.g., collateral types, fees).
- Community-directed USDC pools enhance protocol stability.
👉 Explore DeFi strategies with Frax
FAQ: Frax Share (FXS) Explained
Q1: How does Frax differ from other stablecoins?
A: Unlike USDT/USDC, Frax uses a hybrid model (partial collateral + algorithms) for flexibility and scalability.
Q2: What’s the role of FXS?
A: FXS governs the protocol, earns fees, and is burned/minted during FRAX operations.
Q3: Can I stake FXS?
A: Yes! FXS stakers earn protocol revenue and voting rights.
Q4: Is Frax audited?
A: Frax undergoes regular smart contract audits to ensure security.
Q5: Which wallets support FXS?
A: Use MetaMask, Trust Wallet, or hardware wallets like Ledger.
👉 Buy FXS securely on top exchanges
Market & Liquidity Insights
- Real-Time Charts: Track FXS prices on CoinGecko, Dextools.
- Liquidity Pools: FXS pairs thrive on Uniswap, SushiSwap.