Welcome to Flywheel, the best place for Frax education, analysis and alpha. We write about Frax and its DeFi partners bringing you the most up to date info straight to your inbox.
What's in this email:
- Fraxtal Opens Its Doors For All
- Ra Launches on Fraxtal
- RWA Makes a Splash at Launch
- Krypto Fraxtal Chicken Is Finger Licking Good
- Governance
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Fraxtal Opens Its Doors For All
The first week of deposits has now been open for Fraxtal and it's been a blast to get on the new network and have some fun trading meme coins.
Due to high gas prices, the cost of moving ETH and other ERC20's from Ethereum to Fraxtal has been around $50-80. This prevented a lot of people with smaller amounts from bridging over. Another bridge provided by Owlto.finance was also opened that allowed for smaller deposits up to .3 ETH and has found widespread use in the community so far.
Looking at the bridge contract, $574,000 worth of assets have been bridged over. Well less than many expected for its first week, no major internal treasury funds have been bridged over yet. Guessing that the team is still testing out the Front End and environment for bugs, and that once that is done, then significantly more funds will be moved over to collateralize the exchanges.
Fraxtal has been added to DeFiLlama and GeckoTerminal, and some data is showing up. Will be tracking this as the weeks go on to see how adoption of Fraxtal increases.
RA Exchange Launches!
Ra launched this week to a hungry crowd of Fraxtal traders. The DEX quickly absorbed liquidity from Fraxswap for meme coins like RWA, FXD and EVE. Additionally, Super Algorithmic Money (SAM) became the first memecoin launched on Ra. SAM also received a gauge and is providing liquidity incentives of 6,000%, as it increases its supply by 50% in a week.
â RA on Fraxtal (@exchange_RA) March 7, 2024
Flywheel did a space with the Ra team on Thursday where we talked about its growth opportunities and what we should expect over the next few months.
RWA Makes a Splash at Launch
It's now been three days since the launch of RWA and it has made a big splash in the Frax community. With 339 holders and market cap just over 1 million this has been the most successful meme coin to be launched. Based on early accounts, it is capturing more than 60% of all volume on Fraxtal and will be receiving significant FXTL points.
These early weeks for FLOX incentives are pretty much wide-open for anyone to come in and earn points. With RWA dominating, we can assume that they will receive a massive amount of points for this first week. We don't know yet if the points are fixed or if they're dynamic based on block space, but if it's for then, RWA is going to be in for a huge surprise later this year.
Krypto Fraxtal Chicken Is Finger Licking Good
Another surprising project that has emerged in these first few weeks is KFC a meme coin designed by a Frax community member. In this game, people can commit to a future deployment of KFC. What makes it interesting is that you can choose using a slider what probability do you want to receive when minting. The lower the probability that you choose, the higher multiplier you get when you meant successfully.
For example, a mint probability of one would receive a multiplier of one. a mint probability of 50% would give a 2X multiplier. A one percent probability would give 100 X multiplier.
The expected value (EV) for each strategy can be calculated using the formula:
EV= Probability of Success à Multiplier à PrizeEV = Probability of Success à Multiplier à Prize
So this means that:
- 100% Success Rate: Here, the multiplier is 1X.
- EV = 1.00 * 1 * 1 = 1.00
- 50% Success Rate: Here, the multiplier is 2X.
- EV = 0.50 * 2 * 1 = 1.00
- 1% Success Rate: Here, the multiplier is 100X.
- EV = 0.01 * 100 * 1 = 1.00
The game is designed in such a way that the expected value is the same regardless of the success rate chosen. There is no optimal strategy in terms of maximizing the expected KFC mint value since all strategies yield the same expected value.
There are several strategies you can use to play though. Here are a few.
- Play It Safe Strategy: Opt for a high success rate, like 100% or close to it. This strategy ensures that you consistently mint KFC, even though the multiplier is low. It's suitable for risk-averse players who prefer steady outcomes over the uncertainty of potentially higher rewards.
- High-Risk, High-Reward Strategy: Choose a very low success rate, like 1%, to capitalize on the high multiplier. This strategy is suitable for risk-tolerant players who don't mind losing often in exchange for the chance of winning a large mint occasionally.
- Dynamic Strategy: If the game allows, you could vary your success rate from round to round based on your progress in the game or based on a predefined pattern. For example, you might start with safer bets to accumulate some prizes and then take bigger risks once you have a safety net.
With the dynamic strategy, you could try to adjust your bets so that you hit your minimum of what you want to receive in KFC, and then, after that, you take higher risk, bets to potentially push your KFC allocation. For example, you could bet at 80% with the majority of your stake and if it hits, then you use the remaining 20% to then take higher risk bets.
But ultimately, there is no positive EV in this game. It doesn't really matter how you play you get the same odds every single time. We talked with the creator and he said that he doesn't want it to be gambling, just a fun way to try to mint KFC.
Governance
Proposed
Voting
Passed
- [FIP - 331] Add FRAX/wfrxETH Fraxswap Pool on Fraxtal to the FXS gauge controller 1
- [FIP - 332] Add FRAX/FXS Fraxswap Pool on Fraxtal to the FXS gauge controller
- [FIP - 333] Add FRAX/FPI Fraxswap Pool on Fraxtal to the FXS gauge controller 1
- [FIP - 334] Add FRAX/FPIS Fraxswap Pool on Fraxtal to the FXS gauge controller 4
- [FIP - 335] Add FRAX/sfrxETH Fraxswap Pool on Fraxtal to the FXS gauge controller 1
- [FIP - 336] Add Curve DOLA/FRAXPYUSD to the FXS gauge controller
