Frax Share (FXS) is the governance and value-accrual token of Frax Finance, the protocol behind the FRAX stablecoin and multiple DeFi financial primitives including the frxETH liquid staking derivative and the Fraxtal L2 chain.
| Stat | Value |
|---|---|
| Ticker | FXS |
| Price | $0.43 |
| Market Cap | $41.10M |
| 24h Change | +2.0% |
| Circulating Supply | 95.42M FXS |
| Max Supply | 100.00M FXS |
| All-Time High | $42.80 |
| Contract (Ethereum) | 0x3432...64d0 |
| Contract (Fantom) | 0x7d01...af5a |
| Contract (Polygon Zkevm) | 0x6b85...cace |
| Contract (Moonriver) | 0x6f1d...0e98 |
| Contract (Evmos) | 0xd817...4a9c |
| Contract (Solana) | 6LX8Bh...W7ct |
| Contract (Harmony Shard 0) | 0x0767...c14c |
| Contract (Polygon Pos) | 0x1a3a...9062 |
| Contract (Binance Smart Chain) | 0xe48a...b9ee |
| Contract (Arbitrum One) | 0x9d2f...88a7 |
| Contract (Avalanche) | 0x214d...e387 |
How It Works
Frax Finance began as the first fractional-algorithmic stablecoin — a hybrid model between fully collateralized stablecoins (like USDC) and purely algorithmic designs (like the failed UST/LUNA). FRAX was partially backed by USDC collateral and partially stabilized by FXS as an algorithmic component.
Evolution of the Frax model:
- Frax v1 (2020): Fractional-algorithmic FRAX, partially collateral, partially algorithmic. FXS was burned when minting FRAX at less than full collateralization, and vice versa when redeeming.
- Frax v2: Moved toward full collateralization (AMO — Algorithmic Market Operations) after Terra/Luna collapse damaged confidence in algorithmic components. Frax accumulated USDC and other assets algorithmically.
- Frax v3: Full collateralization; FRAX backed by real-world assets (US Treasuries) and on-chain assets, with no algorithmic component. Also introduced frxUSD, a new yield-bearing stablecoin.
- frxETH / sfrxETH: Frax’s liquid staking token for Ethereum. Users deposit ETH to receive frxETH (liquid, tradeable) or sfrxETH (yield-bearing, capturing all ETH staking rewards from the pool).
- Fraxtal L2: An Ethereum L2 built by Frax Finance using the OP Stack, launched in 2024, using FRAX as the gas token.
FXS role: FXS captures revenue from the Frax ecosystem — protocol fees from AMOs, frxETH staking revenue, and Fraxswap trading fees are directed to FXS stakers (via veFXS or equivalent mechanisms).
Tokenomics
- Max supply: 100 million FXS
- Distribution: 60% to community (liquidity programs, yield farming, treasury), 20% to team/founders (vested), 12% to investors (vested), 8% to ecosystem development
- veFXS: Users can lock FXS for up to 4 years to receive veFXS, which boosts yield across Frax products and grants governance voting power proportional to lock time
- Burns and buybacks: Protocol revenue generates FXS buybacks from the open market and/or direct distribution to veFXS holders
- No ChangeNow support: FXS does not currently have ChangeNow swap integration; it’s available on Uniswap, Curve, and major CEX platforms
Use Cases
- Protocol governance: FXS/veFXS holders vote on Frax’s financial policy, including FRAX collateral ratio targets, AMO strategies, frxETH fee distribution, and Fraxtal chain development
- Yield/revenue accrual: Protocol revenues are directed to veFXS lockers, making FXS a claim on Frax Finance’s growing multi-product revenue
- Gauge voting: veFXS holders vote on Fraxswap and Frax liquidity gauge weights, similar to the Curve/Convex power structure
- Fraxtal participation: FXS is used for staking and delegation on Fraxtal, the Frax L2
History
- 2020, December — Frax and FXS launch on Ethereum; FRAX is the world’s first fractional-algorithmic stablecoin.
- 2021 — Frax expands to multiple chains; FRAX reaches $1B+ market cap; FXS reaches an ATH of ~$45.
- 2022 — Terra/LUNA collapse forces algorithmic stablecoin reexamination. Frax progressively increases FRAX’s collateral ratio toward full backing.
- 2022 — Frax launches frxETH and sfrxETH, the liquid staking product; FRAX achieves 100% collateralization.
- 2023 — Frax moves to full collateralization with real-world asset backing; AMO strategies deploy capital into yield-bearing instruments.
- 2024 — Fraxtal L2 launches on OP Stack; FRAX rebranded toward frxUSD; Frax Finance becomes a multi-product DeFi platform.
Common Misconceptions
- “FXS is algorithmic stablecoin backing like LUNA.” Frax moved away from the fractional-algorithmic model after Terra’s collapse; FRAX is now fully collateralized. The comparison to LUNA is outdated.
- “FRAX and FXS are the same token.” FRAX is the stablecoin, designed to stay at $1. FXS is the governance/value-accrual token with a variable market price.
- “Frax is just a stablecoin project.” Frax has evolved into a multi-product DeFi platform with liquid staking (frxETH), a DEX (Fraxswap), a savings product (sFRAX), and its own L2 blockchain (Fraxtal).
Criticisms
- Complexity risk — Frax has undergone multiple design pivots, and the protocol’s expanding surface area (stablecoin, LST, DEX, L2) increases smart contract and governance risk.
- Governance token tension — veFXS’s power over gauge weights makes FXS governance partially resemble the Curve Wars dynamic, which can distort incentives.
- Competitive stablecoin market — FRAX competes with USDC, USDT, DAI/USDS, LUSD, and newer stablecoins in a crowded market; maintaining relevance requires continued protocol evolution.
Related Terms
- FRAX — the stablecoin issued by Frax Finance
- Liquid Staking — the category frxETH/sfrxETH belongs to
- Stablecoin — foundational context for understanding FRAX’s design
- Curve DAO Token — closely related governance model (veCRV parallels veFXS)
Sources
- Frax Finance documentation — technical documentation for all Frax products including current collateralization design.
- Sam Kazemian on Frax v3 (2023) — founder explaining the v3 design shift to full collateralization.
- Messari: Frax Finance protocol overview — independent analysis of Frax’s product evolution and financials.