"HIGHER" - FraxCheck #65

Apr 2, 2024
"HIGHER" - FraxCheck #65

This week... I call this week the "HIGHER" week. As the name suggests, we are heading to new heights.


  1. FRAX // 99.7% CR
  2. frxETH // Big Imbalance 85/15
  3. FraxLend // ~$1M in AMO + Liq Rev

1. FRAX // 99.7% CR

Now the CR is really as close as it could get to 100%. It was a long and deep bear market but we marched our way to 100% CR, one revenue dollar at a time.

For the last four months, the FRAX supply remained flat at $650M but what changed is our Assets.

Assets dropped by $6.3M (-0.7%), while Liabilities also decreased by $7.3M so that means the Equity Balance had a baby bump of $1.0M (+0.8%). This contributed to our CR going all the way to 99.7%.

In terms of liquidity, though now we have two options (USDC and PYUSD), we are still quite short from the large multi-9-figure TVL that we had last year. At one point, the amount of Frax-related liquidity pools on Curve versus the native 3Pool was 3-to-1. Now, it's closer to 1:1 as seen in the graph below.

2. frxETH // Imbalance of 85/15

We can't have all good things. Unfortunately, we're experiencing a downtrend for the crowd's favorite product, frxETH, and a great imbalance in the liquidity pools.

Imbalances cause the peg price to weaken drastically, as seen when we tried to swap 3.5k ETH, which was a number we've always used. The peg used to be in the 0.99x range but now it's 0.979.

We dropped below the 300k ETH mark and kept going lower to 279k ETH. Fortunately, we managed to hold onto our market share at 2%.

We are also climbing back up the rankings with us back in 5th! Stone dropped out of their place, experiencing a 27% drop over the last week.

More good news is that the monetary premium rose to 20%. That means there are approximately 75,000 frxETH being used outside of the Curve-Frax system – pretty great to see the adoption of Frax's LST in the wild. Also, every LPer and sfrxETH staker is receiving a sweet bonus on their yields.

3.FraxLend // ~$1M in AMO + Liq Rev

FraxLend is making it rain. Last we saw the revenue run rate nearly 3.5x'd since the beginning of the year. This week we are holding onto the revenue of $220k/week.

In addition to these interest earnings, Frax also earns profit from liquidation fees.

For March, 22 positions were liquidated, which amounted to $122k in fees for the protocol. This puts the total annual run-rate of FraxLend into the $13M ballpark. What a revenue-generating machine.

PS. Pour one out for the liquidated homies.


Not financial or tax advice. This article is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This post is not tax advice. Talk to your accountant. Do your own research.

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