# Frax Finance

> The Future of Digital Money

Frax Finance creates stablecoin infrastructure backed by institutional treasury assets and powered by blockchain technology.

Frax Finance creates institutional-grade stablecoin infrastructure for global finance through frxUSD backed by US Treasury assets, the Fraxtal L2 blockchain, and cross-chain protocols. Users can mint stablecoins, stake for yield, and access DeFi services across multiple networks. 

- Type: Company
- Sector: Finance
- Status: Active
- Founded: 2019-05-01
- Profile: https://thegrid.id/profiles/frax_finance

## Products

- [Fraxtal](https://thegrid.id/profiles/frax_finance): Fraxtal is an EVM-compatible L2 blockchain using OP stack technology with FRAX as gas token, featuring blockspace incentives called Flox that reward users and developers with FXTL points. (L2, Live)
- [Fraxnet](https://thegrid.id/profiles/frax_finance): Fraxnet is a cross-chain platform using LayerZero and CCTP protocols for frxUSD minting and redemption across multiple blockchains, including KYC functionality and direct bank account integration. (Cross-chain Infrastructure, Live)
- [Fraxswap](https://thegrid.id/profiles/frax_finance): Fraxswap is an AMM based on Uniswap V2 with time-weighted average market maker orders, used for protocol rebalancing, liquidity provision, and large trustless trades over time. (Decentralised Exchange, Live, Main Product)
- [Fraxlend](https://thegrid.id/profiles/frax_finance): Fraxlend is a permissionless lending market for Frax stablecoins, enabling customized non-custodial loans and collateral asset onboarding to the Frax ecosystem. (Decentralised Borrowing & Lending, Live)
- [BAMM](https://thegrid.id/profiles/frax_finance): Borrow-AMM (BAMM) is a borrowing and lending module that operates without external oracles, allowing borrowers to rent liquidity for automated leverage management. (Decentralised Borrowing & Lending, Live)
- [Fraxferry](https://thegrid.id/profiles/frax_finance): Fraxferry is a cross-chain token bridge using a batched transaction system with a 24-48 hour settlement period. The protocol uses a permissioned operator model with challenge periods allowing watchdog accounts to dispute suspicious batches before execution. (Bridge, Live)

## Assets

- [Frax USD (frxUSD)](https://thegrid.id/profiles/frax_finance): frxUSD is a USD-pegged stablecoin issued by Frax Finance. It is used for payments, DeFi collateral, and cross-chain transactions across multiple blockchains. The stablecoin uses a hybrid model with governance-approved enshrined custodians who mint and redeem frxUSD by holding tokenized treasury reserves, allowing real-world entities to custody backing assets while maintaining onchain mechanisms. (Stablecoin)
- [Frax (FRAX)](https://thegrid.id/profiles/frax_finance): FRAX is the native token of the Fraxtal blockchain, rebranded from Frax Share (FXS) in April 2025. It is used to pay transaction fees and will be used to secure the network through validator staking in a future upgrade. The Frax Burn Engine permanently removes tokens from ecosystem activities like domain registrations and transaction fees, creating deflationary pressure to counterbalance the tail emission schedule that starts at 8% annual inflation and decreases by 1% yearly until reaching 3%. (Utility)
- [Frax Ether (frxETH)](https://thegrid.id/profiles/frax_finance): frxETH is a liquid staking token representing staked ETH on Frax Finance. It is used as collateral in DeFi protocols, for liquidity provision, and as the native gas token on Fraxtal. Unlike typical liquid staking tokens, frxETH does not automatically earn staking rewards—holders can stake it for sfrxETH to receive validator yields, creating a dual-token system that separates liquidity from yield generation. (Liquid Staking Tokens (LSTs))
- [Staked Frax Ether (sfrxETH)](https://thegrid.id/profiles/frax_finance): sfrxETH is a liquid staking token representing staked frxETH in the Frax Finance vault. It is used to earn staking rewards from Ethereum validators operated by Frax Finance, accruing value from staking yields, transaction fees, and MEV. The token operates as an autocompounding vault where holders maintain a proportional claim on an increasing amount of frxETH as rewards accumulate, similar to Aave's aUSDC and Compound's cUSDC. (Vault Tokens)
- [Frax Price Index (FPI)](https://thegrid.id/profiles/frax_finance): FPI is a stablecoin pegged to a basket of consumer goods as defined by the US CPI-U average. It is used to denominate transactions, value, and debt while maintaining purchasing power against inflation. A Chainlink oracle feeds CPI data on-chain to automatically adjust FPI's redemption price, allowing the token's value to track inflation by increasing during inflationary periods or decreasing during deflation. (Stablecoin)
- [Frax Price Index Share (FPIS)](https://thegrid.id/profiles/frax_finance): FPIS is the governance token of the Frax Price Index (FPI) stablecoin, which is pegged to a basket of consumer goods based on the US CPI-U. It is used to vote on FPI operations and entitles holders to seigniorage and excess yield from the treasury. FPIS is set to be phased out by March 22, 2028 and convertible thereafter to FXS, making it a temporary governance mechanism within the broader Frax ecosystem. (Governance)
- [Staked Frax USD (sfrxUSD)](https://thegrid.id/profiles/frax_finance): sfrxUSD is a yield-bearing vault token representing staked frxUSD in the Frax Finance ecosystem. It is used to earn yield that automatically accrues to the token's redemption value, and can always be redeemed for the underlying frxUSD with no unstaking fee or price impact. The token utilizes a Benchmark Yield Strategy that dynamically allocates staked funds between carry-trade, algorithmic market operations, and Treasury bill strategies to target the highest risk-adjusted yield available in current market conditions. (Vault Tokens)
- [Fraxtal Points (FXTL)](https://thegrid.id/profiles/frax_finance): FXTL is a points-based incentive system within the Fraxtal ecosystem. It is earned by creating and interacting with smart contracts, spending gas on transactions, and holding specific assets, with rewards distributed to both users and the contracts they interact with. Points will be tokenized no later than twelve months after chain genesis, either as a separate staking token or converted to FXS tokens at a specified ratio. (Digital Reward Assets)
- [Liquid FRAX (LFRAX)](https://thegrid.id/profiles/frax_finance): LFRAX is a USD-pegged stablecoin denomination used within the Frax Finance ecosystem. It serves as the underlying asset for Frax Bond (FXB) tokens, which are zero-coupon bonds auctioned at a discount and redeemable one-to-one for LFRAX upon maturity. When users purchase FXBs, their LFRAX is locked in smart contracts until the bond matures, at which point the contracts automatically convert the bonds back to LFRAX at full face value. (Stablecoin)
- [Staked FRAX (SFRAX)](https://thegrid.id/profiles/frax_finance): SFRAX is an ERC4626 vault token representing staked FRAX deposits in Frax Finance. It is used to earn weekly yield distributions denominated in FRAX stablecoins, with the token's redemption rate increasing over time as rewards accumulate. The token's value appreciates automatically as yield accrues, allowing holders to redeem an increasing amount of FRAX per SFRAX over time. (Vault Tokens)
- [Frax Bitcoin (FRXBTC)](https://thegrid.id/profiles/frax_finance): FRXBTC is a wrapped Bitcoin token proposed for the Frax Finance ecosystem. It was designed to be used as collateral in lending markets and for liquidity provision across Frax products. The project was discussed but ultimately deprioritized in favor of other ecosystem developments like frxETH and Fraxtal, leaving the deployed contracts largely inactive. (Wrapped Tokens)
- [Legacy Frax Dollar (FRAX (Legacy))](https://thegrid.id/profiles/frax_finance): FRAX (Legacy) is a USD-pegged stablecoin originally issued by Frax Finance, now deprecated following the North Star upgrade. It was used for payments, DeFi collateral, and liquidity provision across multiple blockchains. The original FRAX token was renamed to Legacy Frax Dollar to make way for frxUSD as the protocol's primary stablecoin, with holders able to migrate their tokens through the official interface. (Stablecoin)
- [Vote-Escrowed FRAX (veFRAX)](https://thegrid.id/profiles/frax_finance): veFRAX is the vote-escrowed governance token of Frax Finance created by locking FRAX for up to four years. It is used to vote on protocol parameters across the Frax ecosystem and to receive protocol revenue distributions in sfrxUSD. Holders who lock their tokens for longer periods receive greater voting power, aligning governance influence with long-term commitment to the protocol. (Governance)

## Links

- [Main](https://frax.com)
- [Media Kit/branding](https://docs.frax.com/protocol/integration/brand)
- [Documentation](https://docs.frax.com)
- [Governance](https://snapshot.org/#/s:frax.eth)
- [Forum](https://gov.frax.finance)
- [Privacy policy](https://app.frax.finance/privacy)
- [Terms of Service](https://app.frax.finance/terms)
- [Twitter / X](https://x.com/fraxfinance)
- [Twitter / X](https://x.com/frax)
- [Discord](https://discord.gg/fraxfinance)
- [Telegram](https://t.me/fraxfinance)
- [GitHub](https://github.com/FraxFinance)
- [Substack](https://news.frax.com)

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