MAR 09, 2022 • 12 Min Read
FRAX is a hybrid algorithmic stablecoin whose model is similar to that of UST. However, while UST is now 7.5% backed by exogenous collateral (i.e. BTC), FRAX is 84.5% directly backed by exogenous collateral, making it less reliant on the algorithmic component. This model is in contrast to an overcollateralized stablecoin such as DAI, whose CR ranges from 101-175%. Importantly, FRAX’s collateralization ratio is not static, but rather increases or decreases based on demand for the stablecoin (we dive into these mechanics later on in this post).
Delphi Pro is our institutional-grade crypto research and analysis offering, providing full market coverage across deep-dive reports, analysis, data and community.
Starting at $499 a month**Create a free account
* Team features available on multi-seat purchase.
** Based on purchase of annual subscription.