Frax Share (FXS) is the world’s first fractional-algorithmic stable token. In this article, “What is Frax Share?” We will answer the question. In addition, we will touch on other questions about the project.
What is Frax Share? What does it do?
Unlike Tether, one of its strongest counterparts, Frax (FXS) is the world’s first fractional-algorithmic stable token. In other words, it is a partially collateralized and partially algorithmically stabilized stablecoin. It was released in 2020.
What is FXS coin?
FXS coin is Frax Share’s native token. Frax is a community-driven, uniquely designed stablecoin where over 60% of the FXS supply has been released over the course of a few years to bring to farmers and liquidity providers. The project has a 100% decentralized structure with on-chain governance. However, management does not include voting on or presenting proposals, as the project aims to minimize conflicts and differences of opinion in its community.
The project also operates as the first and only stablecoin to use a fractional-algorithmic hybrid design. Also, FXS is its governance token. The variable is a utility token, while FRAX is the project’s stablecoin, traded at $1.
How does Frax Share work?
Each stablecoin is different from the other in terms of the underlying mechanism. Currently, stablecoins fall into three categories:
- Collateralized stablecoins backed by a valuable asset.
- Unsecured stablecoins sustain using an algorithmic model rather than a valuable asset.
- Hybrid stablecoins combining both methods above.
Frax is a hybrid stablecoin as it is powered by both asset collateral and mathematical cryptographic algorithms. It is an open source, permissionless, fully on-chain protocol that runs on Ethereum (ETH) and other blockchains. It aims to offer highly scaling, decentralized, algorithmic money instead of fixed-source digital assets like BTC.
The Frax protocol is a two-token system that includes a stablecoin Frax (FRAX) and its governance token FXS. FRAX is always fixed at $1. The margin rate is adjusted according to market demands to keep the price of FRAX at $1 rather than sticking to a predetermined rate. Also, when the token is above $1, the platform will reduce the collateral rate by a step by 0.25%. When the FRAX falls below $1, the margin rate will be increased by one step.
What is Frax Share? How to get FXS coins?
Frax Share is currently traded on numerous cryptocurrency exchanges. People who want to invest in the project should open an account in one of the exchanges where the project is traded. The exchanges where Frax Share is traded are listed as follows: Binance, Bitget, MEXC, BingX. Users who want to invest in the project should open an account on one of these exchanges.
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