We are excited to announce that FinNexus and Frax Finance are building a strategic partnership on the applications in the algorithmic stablecoin ‘FRAX’.
The Frax Protocol introduced DeFi to the concept of a cryptocurrency being partially backed by collateral and partially stabilized algorithmically. FinNexus is building cross-chain protocols on DeFi options and other derivatives. The cooperation of the two will deepen the use-cases on the algorithmic stablecoin, which is regarded as a promising decentralized currency in the future DeFi world.
The FinNexus team is proud to cooperate with Frax Finance to launch a new pool on Ethereum with algorithmic stablecoin FRAX as collateral. The decision comes after a successful vote from our community, which decided with a sizeable majority to select this particular coin among the choices provided.
Our platform will supply FNX to support the mining process, as is already happening with the USDC/USDT pool. (And should the FRAX pool grow very quickly, mining rewards could be increased by voting.)
Pioneering stablecoins as collaterals: a new frontier for DeFi?
Algorithmic stablecoins are some of the hottest projects in the crypto space. At a basic level, they are tokens that use algorithms to control their prices by expanding supplies when prices move above targets and contracting them when they fall below.
Algorithmic stablecoins play an increasingly important role in DeFi, and Frax is one of the main examples on the market. A two token system encompassing a stablecoin, Frax (FRAX), and a governance token, Frax Shares (FXS), it attempts to be the first stablecoin protocol to create a highly scalable, trustless, extremely stable, and ideologically pure on-chain money.
The FinNexus team believes there will be significant advantages to having a new pool with FRAX as collateral and tapping into the stablecoin market.
Please be aware that given the inherent risks associated with any new project, if the new pool with algorithmic stablecoins fails to attract more than $500K TVL in 15 days or a systematic failure materializes at some point in the future, the team reserves the right to shut the pool down.