Based on a fractional algorithm Frax System (FXS) is the first stablecoin that was created. It is an open-source, on-chain with ERC and permission less project that is implemented on Ethereum (with possible inter operability as well). The goal of the project is to replace fixed supply coins like Ethereum and Bitcoin and bring in the algorithmic-based coins that have their utility.
FXS is a stable coin that is based on fractional algorithm with components of its issuance based on supply and collateralization . The price of the coin defines the collateral size of the project. If the coin us being traded for more than $1 then the collateral size is reduced. Similarly if it is being traded at a price of less than $1 then the size is increased.
Frax Tokens – FXS is a stablecoin which has its value pinged to $1. Stablecoins were previously split into 3 categories: based on fiat, based on algorithm and over collateralized. Moving towards the fourth and most distinct category is decentralized stable coin based on a fractional algorithm.
How does Frax Share (FXS) Work
The project (FRAX) is driven by community and has a very unique design of operation. Over 60% of the FXS supply is distributed to liquidity providers and yield growers over several years. With on-chain governance, it is a completely decentralized protocol. During the time of its creation, FRAX was the only project that used a Collateral and a stablecoin operation based on an algorithm.
How is It Unique?
Due to its fractional-algorithmic monetary policy, the amount of coins in circulation is ever-changing in such a way as to keep the value pinged at $1. The supply of the coin is limited to 100 million coins with no timetable that shows about inflation. Governance of the project is also done through this coin, and holds the value of all the newly minted FRAX, as well as fees and excess collateral. FXS is a currency token and is an investment and governance asset.
Price Movement – Frax Share (FXS)
At the time of writing, FXS is being traded at the price of almost $38.04%. The price has almost increased by 15% in the past 24 hours. It is listed on coinmarketcap on 225th rank. The price had a minimum of about $32.76. During the past 24 hours, the maximum was around $38.72.
