Frax (FRAX)
1. Fundamental Analysis
1.1 Introduce
Frax is the world’s first fractional-algorithmic stablecoin.The Frax Protocol introduced the world to the concept of a cryptocurrency being partially backed by collateral and partially stabilized algorithmically.
1.2 Basic Info
| Name | Value | Name | Value |
|---|---|---|---|
| Symbol | FRAX | Market Cap | 628131597.6 |
| Name | Frax | White Paper | -- |
| Web Site | https://frax.finance | Is ICO | None |
| Wallet | -- | Raised Funds | - |
| Source | -- | Distribution | - |
| Explorer | https://etherscan.io/ | Algorithm | -- |
| Forum | -- | Proof | -- |
| Mining | Total | 812641409.408784 | |
| Supply | 812641409.408784 | Release Date | 2020-12-21 |
| Available Supply | 649433000 |
2. Technical Analysis
2.1 Kline Chart
2.2 Analysis
The K-line chart indicates a strong trend of consolidation in the asset. The price has been oscillating within a relatively tight range over the past few weeks, showing a lack of significant momentum in either direction. The volatility has been high, but the price has not been able to sustain any upward or downward movement beyond the consolidation range.
The opening price has been fluctuating around the 0.97-1.00 range, with a notable drop on December 7th to open at 0.9714, suggesting a possible temporary shift in sentiment. However, the asset quickly regained its value, closing the day at 0.9744, and has since been bouncing back within the consolidation zone.
The closing price has been mostly stable within the 0.97-1.00 range, indicating that the market is currently indecisive and unable to break out of the current pattern. The high and low prices have also been within this range, reinforcing the trend of consolidation.
Volume has been relatively high at times, indicating active trading and a high level of interest in the asset. However, there is no clear pattern in volume, suggesting that the market participants are unsure about the future direction of the asset.
Overall, the conclusion is that the asset is currently in a state of consolidation, with no clear trend in either direction. The market is indecisive, and a breakout in either direction is possible but cannot be predicted with certainty.
3. News Analysis
3.1 News
20241229
- Frax community initiated a proposal vote on "USTB as frxUSD collateral and custody asset" ↑
20241227
- Frax Finance community has opened the proposal voting for "Using BlackRock BUIDL as the supporting asset for frxUSD" ↑
20241223
- Securitize proposes to add BlackRock’s BUIDL token as backing for stablecoin Frax USD ↑
- Securitize recommends Frax Finance to use BlackRock’s BUIDL as a backing asset ↑
3.2 Analysis
The message data indicates a series of developments within the Frax Finance community and its ecosystem, specifically surrounding the collateralization and backing of the stablecoin frxUSD. The trend suggests a move towards enhancing the stability and credibility of frxUSD by incorporating high-quality assets as backing.
The initiation of a proposal vote on December 29, 2024, for "USTB as frxUSD collateral and custody asset" signifies an exploration of using a new asset as a collateral for the stablecoin. This move could potentially diversify the collateral pool and provide additional security to the frxUSD.
The subsequent proposal on December 27, 2024, to use BlackRock BUIDL as the supporting asset for frxUSD, followed by Securitize s recommendation to Frax Finance, points towards a significant shift in the community s strategy. The involvement of BlackRock, a leading financial institution, lends credibility to the proposal, suggesting a move towards more traditional financial markets to enhance the stability of the stablecoin.
Securitize s endorsement of BlackRock BUIDL as a backing asset indicates a potential trend of leveraging established financial entities and their digital assets to underpin the stability of decentralized finance (DeFi) stablecoins. This could signify a broader trend where DeFi projects seek to align with traditional finance to increase trust and stability.
Predicting future trends based on this data, it is plausible that we will see a growing trend of DeFi projects seeking to incorporate traditional financial assets and institutions into their ecosystems. This could lead to increased collaboration between the DeFi and traditional finance sectors, potentially resulting in a more integrated financial system. Additionally, the use of high-quality assets like BlackRock BUIDL as backing for stablecoins could become more prevalent, as projects strive to enhance the credibility and stability of their offerings.
