Frax Finance Unveils Fraxchain

Frax Finance, best known for developing the Frax stablecoin, has revealed its plan to launch Fraxchain, a Layer 2 blockchain.

The team stated that the network would focus on developing a platform for smart contracts with a strong emphasis on decentralized finance.

Frax founder Sam Kazemian told The Block that Fraxchain represents the culmination of the complete Frax ecosystem and all of the traction and usage that Frax has gained.

The network should be operational by the end of the year. Fraxchain governance will be governed by Frax Shares (FXS) token holders.

Frax stablecoin and Frax Ether, Frax’s liquid staking derivative, will be used to pay transaction fees on the network.

Kazemian added that a portion of the fees generated by the roll-up network could be incinerated or redirected back to the Ethereum mainnet to be distributed among FXS governance token holders.

Fraxchain will secure the Ethereum network by publishing state origins to the Ethereum mainnet using a Layer 2 roll-up model.

Fraxchain will implement distributed sequencers. In a roll-up network, these sequencers are the specialized nodes organizing transactions into segments.

They will be administered by any entity selected through a governance referendum.

According to Kazemian, this characteristic will distinguish Fraxchain from other Layer 2 solutions on Ethereum, which typically rely on a singular sequencer.

“Fraxchain proposes a solution in which sequencer roles can be auctioned and rotated, thereby establishing a decentralized sequencer basis.

“Fraxchain would allow the next elected sequencer to pick up where the previous sequencer left off if a sequencer is forced to shut down,” Kazemian explained.