Adding FRAX as Collateral in Our Fuse Pool

FRAX is an algorithmic stablecoin that is partially collateralized by USDC at a rate determined by the floating market price of FRAX. When FRAX dips below $1, its USDC collateralization ratio increases until the market returns to parity; when above $1, its USDC collateralization ratio decreases accordingly.

FRAX has held its peg remarkably well over time, even during high volatility periods in the market: Frax price, chart, market cap and info | CoinGecko

FRAX makes for an interesting addition to our Fuse pool because of a program they refer to as an Algorithmic Market Operation. It would allow FRAX to periodically mint stablecoins into our Fuse pool to satisfy demand. FRAX Lending - Frax ¤ Finance

FRAX could prove to be a powerful partner, especially if our Fuse Pool demand for stablecoins quickly outstrips supply with SY jTokens and SA sen tokens (post next week) getting added over the coming weeks.


Sounds reasonable to me, our fuse pool needs stable coin liquidity for all BarnBridge products.


I’m also in favor - I think this would be a nice addition to the pool.

parsec for reference