Frax FRAX
Frax Finance
Frax pioneered the fractional-algorithmic stablecoin model. After Endgame governance migration, FRAX is now fully collateralized and complemented by frxUSD (yield-bearing) and FXB (term bills).
Frax Finance (DAO)
- Country of origin
- Decentralized
- Jurisdiction
- On-chain DAO governance
- Founded
- Jan 1, 2020
- Structure
- dao
- Sam Kazemian Founder · since 2020
Timeline
- Dec 21, 2020FRAX v1 launches (fractional algorithmic)
First stablecoin with partial algorithmic backing.
- Feb 22, 2023FRAX v3 — fully collateralized
Community votes to remove algorithmic component; FRAX becomes 100% backed.
- Aug 15, 2024Endgame: frxUSD + FXB
Frax restructures into FRAX (peg), frxUSD (yield) and FXB (term bills).
Backing
Mechanism and reserves
Backing
Multi-asset: USDC (PSM), sDAI, BlackRock BUIDL (T-bills), Curve LP collateral, frxETH/sfrxETH staking yield, and Treasury notes acquired via tokenization partners.
Mint / redeem
Permissionless mint/redeem via Frax's AMO (Algorithmic Market Operations) contracts; PSM offers near-zero-fee USDC↔FRAX swaps.
- On-chain AMO disclosures (facts.frax.finance) · Real-time View proof →
Reserve composition
- BUIDL + Treasuries 38.5%
- USDC PSM 27.4%
- Curve LP collateral 12.6%
- sDAI 11.0%
- sfrxETH 7.3%
- Other 3.2%
Networks and deployments
arbitrum 
base 
optimism Real-world use
- ›DeFi-native stablecoin liquidity
- ›frxUSD yield product for treasuries
- ›FXB term-bill yield curves
- ›Curve liquidity routing
Regulation and compliance
DAO governance excludes federal compliance.
DAO-issued stablecoins face MiCA EMT challenges.
- !Pre-2023 algorithmic FRAX raised concerns post-Terra collapse; community moved to full collateralization.
Specific risks
- ● Smart-contract risk on AMO contracts
- ● Multi-collateral correlation risk in stressed markets
- ● Indirect USDC dependency via PSM
Compare with
Resources
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How Frax fits in
This page is a structured snapshot of Frax as of 2026-05-31. For deeper analysis, see related blog posts on the blog index.