Frax USD (frxUSD) Reseña

What is the Frax stablecoin? The short answer

Frax Finance's stablecoin today is frxUSD, a dollar token launched in January 2025 and backed mainly by tokenised US Treasury funds. About $103 million of it existed on 17 October 2026, per Frax's own balance sheet and CoinGecko. It replaced the original FRAX stablecoin of 2020. That coin still trades as "Legacy Frax Dollar" but is being wound down. On centralised exchanges such as Binance, the FRAX ticker now means a third asset, the former FXS token, which trades around $0.30.

The naming trips up buyers. So this page starts there, then covers what backs frxUSD, who controls it, how sfrxUSD earns yield, and why neither Frax dollar is regulated in the US or the EU, with no UK authorisation that we could find.

frxUSD, legacy FRAX and the FRAX token: which is which?

Three tokens share the Frax name, and only one of them is the current stablecoin.

The changes came through Frax DAO votes. FIP-419, passed on 31 December 2024, launched frxUSD as a new token rather than renaming the old one. FIP-428, passed in March 2025, renamed the old coin Legacy Frax Dollar and FXS to FRAX, and the FXS upgrade went live in late April 2025, per Frax's docs. On Binance, FRAXUSDT is the former FXS token, not a dollar, and CoinGecko uses the FRAX symbol for both the Legacy Frax Dollar and the former FXS.

Check the Ethereum contract before you buy: frxUSD is 0xCAcd6fd266aF91b8AeD52aCCc382b4e165586E29, the Legacy Frax Dollar is 0x853d955aCEf822Db058eb8505911ED77F175b99e, and the former FXS is 0x3432b6a60d23ca0dfca7761b7ab56459d9c964d0, which still shows as FXS on Ethereum.

Who issues frxUSD?

Frax Inc, a public benefit corporation formerly known as FinresPBC, under a licence from the Frax DAO. In July 2025 the DAO handed it "the full compliance infrastructure and collateral management of frxUSD" through FIP-432, and in February 2026 FIP-441 went further, licensing frxUSD's issuance rights to Frax Inc on an "exclusive, perpetual, and irrevocable basis" that the DAO cannot revoke at will. Frax's own updates describe Sam Kazemian as "Frax Founder and CEO".

So the "decentralised DAO" description that once fit Frax no longer fits frxUSD. A company runs the reserves and the bank and fund accounts, and a 4-of-7 multisig owns the Ethereum contract. LlamaRisk, a risk adviser, reported in its August 2025 review that Frax Inc held no state money-transmitter licence, trust charter or OCC authority, and we found no licence since.

What backs frxUSD?

Mostly tokenised money market and Treasury funds, according to Frax's live balance sheet, read on 17 October 2026:

The catch is that Frax reports these figures itself. No accounting firm has issued an attestation or assurance report on frxUSD's reserves, and LlamaRisk said the same in 2025. Part of the reserve can be checked on-chain, where custodian contracts hold the fund tokens.

Two pieces cannot. One is $52.9 million of WTGXX held in Frax Inc's BitGo trust account. The other is $2.0 million of cash at Erebor Bank, an FDIC-insured national bank since February 2026, per the FDIC's BankFind data. Deposit insurance applies to bank deposits, not to frxUSD tokens, and we found nothing showing that it passes through to frxUSD holders.

Since November 2025 Chaos Labs has run an automated proof-of-reserves feed for frxUSD. It monitors reserves continuously, but it is not an accounting attestation, and its post does not say which inputs feed it.

The underlying funds have their own auditors and custodians, which helps. LlamaRisk lists PwC for BUIDL and Ernst & Young for USTB and WTGXX, with BNY Mellon and UMB Bank as custodians. Frax's docs promise "regular audits and reporting from industry-leading firms" without naming one.

What happened to the original FRAX stablecoin?

It shrank and was set aside. Legacy FRAX launched in December 2020 as a partly algorithmic stablecoin and peaked at about $2.91 billion in March 2022, per DefiLlama. In March 2023, when USDC briefly lost its peg after Silicon Valley Bank failed, legacy FRAX traded as low as about $0.88 on some venues because part of its collateral was USDC, Bankless reported.

Weeks earlier, in February 2023, the DAO had voted through FIP-188 to move it to full collateral, yet in December 2023 S&P Global gave it its weakest stablecoin stability score, 5 (weak). That score applies to legacy FRAX, not to frxUSD.

The key date for holders is 30 April 2025. That day FIP-430 passed, and the DAO stopped guaranteeing a 1:1 swap from legacy FRAX into frxUSD. Since then holders exit at market prices on Curve and other pools, where legacy FRAX has traded at a persistent small discount, between about $0.985 and $0.997 over the past year, and stood at $0.9916 on 17 October 2026.

Frax keeps a separate balance sheet for legacy FRAX. On 17 October it showed $110.8 million of assets against $121.6 million of liabilities, about 91%, and about 70% of those assets, $78.2 million, were legacy FRAX or staked FRAX that Frax holds itself, by our reading of the data.

The largest item was $37.5 million of staked FRAX posted as collateral to borrow $20 million of USDT. Frax itself said in FIP-430 that legacy FRAX would not be compatible with the GENIUS Act, and FIP-441 says the team will support the legacy peg "as it slowly winds down over months".

Is frxUSD safe?

It has held its peg, but it rests on trust in Frax's own reporting. Here are the trade-offs:

• Peg record. DefiLlama's daily prices for frxUSD have stayed between $0.98 and $1.02 since February 2025, and we found no press report of a depeg.
• Self-reported reserves. The 102.9% figure comes from Frax, with no outside attestation.
• Admin powers. Since an upgrade on 5 August 2025 the Ethereum contract can freeze accounts, pause transfers and burn an address's balance. A 4-of-7 multisig has held those powers since 4 June 2026, replacing a 3-of-5 one. On-chain logs showed no freeze or pause by 17 October 2026. The contract has been upgraded three times since launch.
• Shrinking size. Supply fell from about $132 million in May 2026 to $99 million to $103 million in October, and peaked at $199 million in March 2025.
• Code reviews. Zellic audited the frxUSD contracts in July 2025, per Frax's audit list; no review is listed for the January 2026 and April 2026 upgrades.

How do you mint, redeem or cash out frxUSD?

There are two routes. On Ethereum, custodian contracts mint frxUSD 1:1 against USDC or tokenised funds and redeem it back, with no mint fee and a 0.01% redemption fee on the fund custodians, read on-chain on 17 October 2026. The fund tokens are whitelisted securities, and BUIDL and USTB are limited to accredited investors or qualified purchasers, so most people redeem into USDC or sell on a decentralised exchange.

The second route is FraxNet, Frax's account service. After identity checks through Persona and Bridge, a Stripe company, users can deposit dollars by ACH or wire, or euros by SEPA, and cash out frxUSD to a US bank account, per Frax's on-ramp and off-ramp docs. ACH takes one to three business days. Bridge may charge an exchange fee, and a 0.01% fee can apply when fund shares are sold. Pound transfers were listed as "Coming Soon".

What is sfrxUSD and what does it pay?

sfrxUSD is a vault token. You deposit frxUSD, and the vault's share price rises as its strategies earn. Over the 30 days to 17 October 2026 it returned about 5.0% a year, based on the on-chain share price, and Frax quoted 5.1%. The yield comes from a mix of lending markets, carry trades and Treasury exposure chosen by DAO votes, not from the reserve itself, so it can fall and carries smart-contract risk. About $38 million sat in sfrxUSD.

Frax also markets rewards for holding frxUSD in a FraxNet account. Once the GENIUS Act's rules apply, a permitted US issuer may not pay interest just for holding its stablecoin, so that offer may have to change if Frax Inc seeks a licence.

Which blockchains is frxUSD on?

Frax's contract list showed 26 mainnets in October 2026, from Ethereum and Fraxtal to Solana, Base, Arbitrum and newer chains such as Tempo and Stable. Supply is concentrated, with about 77 million on Ethereum and 15.7 million on Fraxtal, per DefiLlama. Tokens move between chains through LayerZero. FIP-445, passed in May 2026, ended support for Aptos, Berachain, Mode, Movement and Scroll on 30 July 2026, after FIP-438 dropped Polygon zkEVM and Blast in November 2025.

Is frxUSD regulated?

No, in any market we checked:

• United States. frxUSD is not a permitted payment stablecoin under the GENIUS Act. Frax's governance posts say Frax Inc intends to apply for a US payment stablecoin licence, but we found no application or approval. From 18 July 2028, US platforms may only offer stablecoins from permitted issuers.
• European Union. Neither Frax dollar appears on ESMA's MiCA register. Uphold stopped supporting legacy FRAX for European users from 1 July 2024, citing MiCA, Cointelegraph reported.
• United Kingdom. We found no FCA authorisation for Frax Inc.

Where can you buy frxUSD?

On decentralised exchanges and through FraxNet. CoinGecko listed 62 frxUSD markets on 17 October 2026, all decentralised, led by Uniswap, Curve, Fraxswap and Aerodrome. Coinbase does not list it, and Kraken and Binance list only the former FXS token, so check the contract address before you buy anything called FRAX.

frxUSD vs legacy FRAX vs USDC

If you want DeFi exposure to tokenised Treasuries with an on-chain vault yield, frxUSD and sfrxUSD are the Frax route. If you want a regulated, attested dollar, USDC fits better, and USDS is the other large DeFi-native dollar.

How is frxUSD taxed in the US?

The IRS treats digital assets as property, per its digital assets page, so swapping legacy FRAX for frxUSD on a decentralised exchange is a disposal, and any gain or loss counts. Yield from sfrxUSD shows up as a rising share price rather than a payout. Our US crypto tax guide covers the general rules.

Who should use frxUSD?

DeFi users who already work with Frax pools, Fraxtal or sfrxUSD and accept self-reported reserves, and US users who want FraxNet's bank on-ramp and off-ramp. Holders of legacy FRAX should know there is no guaranteed 1:1 swap any more and that its own balance sheet shows less than full backing, mostly in Frax's own tokens.

Everyone else is better served by an attested, regulated dollar. Compare options on our stablecoin hub, or read what a stablecoin is for the basics.

Sources

1. Frax, frxUSD balance sheet, legacy FRAX balance sheet and sfrxUSD balance sheet, read 2026-10-17. Accessed 2026-10-17.
2. Frax docs: FRAX token overview, frxUSD, frxUSD and FraxNet overview, mint and redeem, fiat on-ramp and off-ramp, contract list, sfrxUSD and audits. Accessed 2026-10-17.
3. Frax governance forum, FIP-430 (2025-04-21) and FIP-432 (2025-07-07); Snapshot votes FIP-188, FIP-419, FIP-428, FIP-430, FIP-438, FIP-441 and FIP-445, read through the Snapshot GraphQL API (hub.snapshot.org, space frax.eth). Accessed 2026-10-17.
4. LlamaRisk, frxUSD risk assessment, 2025-08-01. Accessed 2026-10-17.
5. DefiLlama, frxUSD supply and legacy FRAX supply; CoinGecko, frxUSD, Legacy Frax Dollar and Frax (prev. FXS) market data, 2026-10-17. Accessed 2026-10-17.
6. Bankless, stablecoin depegs after SVB, 2023-03-14; Cointelegraph, Uphold to delist six stablecoins, 2024-06-18. Accessed 2026-10-17.
7. Exchange market lists: Coinbase, Kraken, Binance, 2026-10-17. Accessed 2026-10-17.
8. ESMA, interim MiCA register of e-money token white papers, updated 2026-10-16. Accessed 2026-10-17.
9. US Government Publishing Office, GENIUS Act; IRS, digital assets. Accessed 2026-10-17.
10. S&P Global, stablecoin stability assessment launch, 2023-12-12; Chaos Labs, frxUSD integrates Chaos proof of reserves, 2025-11-26; FDIC, BankFind record for Erebor Bank. Accessed 2026-10-17.
11. Frax biweekly project updates of 2026-05-17, 2026-06-19 and 2026-10-08. Accessed 2026-10-17.
12. Ethereum on-chain reads (contract owner, upgrade and freeze logs, custodian fees, sfrxUSD share price) via public RPC, 2026-10-17; frxUSD contract source via Sourcify; DefiLlama daily stablecoin prices. Accessed 2026-10-17.
13. WisdomTree, WisdomTree Treasury Money Market Digital Fund (WTGXX); Superstate, Invesco Short Duration US Government Securities Fund (USTB). Accessed 2026-10-17.