The Frax Protocol is the first fractional algorithmic stablecoin system. It sounds quite complex, isn’t it? Let’s have a look at how it operates and analyze all these complex terms to understand better what Frax Finance is and how it works.
The FRax ecosystem represents a DeFi economy. This economy runs on the Ethereum network, but in the future, it is expected that Frax will move to its own blockchain.
The main goal of Frax is to develop a decentralized ecosystem that would rely on algorithmic money instead of assets that have a fixed supply, such as Bitcoin. Now, the protocol’s operations are powered by three stablecoins:
- FRAX - a crypto-collateralized stablecoin pegged to USD.
- FPI - the first stablecoin pegged to a basket of consumer goods. With it, it creates the first its own unit of account independent of any government currency.
- frxETH - it is an Ethereum-pegged stablecoin used to replace WETH in smart contracts.
Along with stablecoins, there are two tokens that power the ecosystem functioning:
- Frax Share - a utility token that can be used for staking and governance.
- Frax Price Index Share - another utility token connected with Frax Share. This token can be used to stake and to only govern the FPI stablecoin’s new properties.
Before FRAX, stablecoins were divided into fiat-collateralized, crypto-collateralized (or rather over-collateralized), and algorithmic. FRAX introduces a new category of stablecoin naming it fractional algorithmic.
The FRAX infrastructure consists of several products.
- FraxSwap - it is the first Automated Market Maker in the DeFi space that includes an embedded time-weighted average market maker. It allows to make large trades over a long period of time. This market maker is 100% permissionless.
- Fraxlend - a lending platform where users can lend ERC-20 tokens.
- Fraxferry - it is a non-custodial method of transferring protocol tokens across multiple blockchains. It doesn’t require any bridges or other third-party solutions to do so.
How to Buy and Where to Store FRAX
FRAX is one of the leading tokens in the DeFi space. As such, it can be purchased effortlessly on the main decentralized exchanges such as Uniswap, Curve, and FraxSwap. LetsExchange also supports this token. You can buy it with one of the 4,000 other coins and tokens supported by the platform. For your purchase, you can use the Swap mode or the DEX mode.
FRAX runs on the Ethereum blockchain, and ERC-20 tokens are the base for the Frax.Finance operations. All wallets that support the ERC-20 standard can store FRAX. Among top wallets, we can recommend such as Trezor and Ledger if we speak about hardware wallets, MetaMask if you prefer hot wallets or your favorite mobile wallet.
FRAX Share Price Prediction 2024 - 2030
Now, let’s check what experts say about the FRAX future. Frax.Finance is an innovative DeFi ecosystem with a wide range of products and tokens. In other words, the FRAX ecosystem is self-sufficient and doesn’t depend on any third-party solution.
The most popular ecosystem token that is traded widely is Frax Share, thus, we will have a look at its perspectives.
At the moment of writing, the coin price is $9.81, with a market capitalization of $750,252,876.
The project is aimed at sustainable growth and development rather than at drastic surges and drops. This is why FXS can be considered a good option for long-term investment.
The maximum price of the token is expected to be $31, and the minimum - $29 in 2024. Thus, FXS will be traded at an average of $27.
In 2025, the FXS price is expected to increase to a maximum of $44. The minimum of FXS can be about $38.
In 2026, the token is forecasted to continue its growth and will be traded in the range between $50 and $55.
2027 will be marked by the same sustainable growth, with FXS being traded between $61 and $66.
In 2028, FXS will continue expanding, and its price is expected to continue growing. The token is forecasted to be traded within the range between $70 and $77.
In 2030, the FXS price is going to cross the $100 level and grow up to $102.
Within the next two decades, the FXS price can exceed $600 in a bearish market, or $500 if there are any major setbacks. This token has immense growth potential and as such, is a good choice for long-term investments.