Frax USD

Frax USD (frxUSD) is a fully collateralized stablecoin issued by Frax Finance, combining off-chain custodians holding cash-equivalent reserves with on-chain minting and redemption mechanisms

## Overview Frax USD (frxUSD) is a fully collateralized stablecoin protocol operated by Frax Finance on Ethereum. Unlike algorithmic stablecoins that rely on market mechanisms or incentives to maintain their peg, frxUSD combines traditional off-chain collateral—held by regulated custodians as cash-equivalent reserves—with on-chain smart contracts that enable direct minting and redemption at face value. The protocol allows users to mint frxUSD by depositing collateral or redeeming frxUSD for the underlying collateral at any time, creating a mechanical arbitrage path that enforces price stabilit