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Interview with the founder of Frax: Talking about Frax’s currency premium, invisible products, and on-chain governance
深潮TechFlow
特邀专栏作者
2023-03-15 12:25
This article is about 923 words, reading the full article takes about 2 minutes
This article will discuss topics such as Frax’s currency premium, stealth products, and on-chain governance.

Original Author: Revelo Intel

Compilation of the original text: Deep Tide TechFlow

Compilation of the original text: Deep Tide TechFlow

stable currency

In this episode, DeFi Dave interviewed Frax founder Sam Kazemian and talked about Frax's currency premium, stealth products, and on-chain governance. Below are some notes recorded, let's find out more together.

stable currency

  • Any stablecoin that is not backed by at least 100% external collateral will not succeed. Recently, the Frax community voted to stake 100% of the entire supply of $FRAX. $FRAX is the only fully collateralized decentralized stablecoin.

  • Frax's currency premium

  • The monetary premium is the concept that if you issue a stablecoin or liability, people will use that stablecoin without expecting a payment or interest rate from the issuer.

  • The vast majority of crypto protocols will become stablecoins or issue their own stablecoins on a large scale.

  • Most financial primitives look like fractional reserve banks.

  • LSD or Liquid Collateral Derivatives are basically $ETH stablecoins.

  • A stablecoin is something issued by an entity with some implicit or explicit promise to maintain a certain price.

  • $frxETH has Curve AMO, which can be swapped between $frxETH and $ETH, like a minting and redeeming function.

Financial laws or financial incentives affect protocols or protocol builders and communities.

  • The most important and valuable way that large DeFi protocols build moats to protect themselves and maximize their value is to issue a liability that people use as money.

  • Stablecoinism

  • Stablecoinism is abstracted like cross-chain bridges that one might not think of.

  • The most valuable advantage of a cross-chain bridge is that it is defensible, and others cannot fork or commoditize it by lowering fees, but in fact they issue a stablecoin on the other side of the chain.

The cross-chain bridge project is essentially a stable currency issuer.

  • Curve is an excellent exchange, better than anything else.

  • become a builder

The most important thing is to ensure safety and see it as a responsibility, which is the foundation of this industry.

  • It is no accident that Frax has become more secure as it has grown bigger and more important.

  • Frax's Stealth Products

They are developing a product called BAMM, which stands for Borrowing Automated Market Maker, which is a potential zero-to-one innovation for DeFi.

  • The idea is that no oracle is needed, it will build liquidity against any asset and allow people to borrow it when the liquidity of the asset rises.

  • On-chain governance of Frax

  • When Frax creates a signature, they fully submit it to the FRXGov contract on-chain, and after a certain amount of time $FXS holders can vote or veto the signature. Then after a certain amount of time, the smart contract itself allows that signature to be executed on-chain.

Supervision

  • There are a lot of people who like to be actively involved in governance.

  • Supervision

  • All things will be resolved in the future.

  • There are many areas in cryptocurrency that require active cooperation with regulation.

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