Frax Finance Will Officially Debut Its Ethereum Layer 2 Next Month

Popular decentralized finance (DeFi) protocol Frax Finance is reportedly preparing to unveil its layer 2 blockchain, Fraxtal, in February, as shared by CEO and founder Sam Kazemian in a recent interview. Kazemian anticipates the launch in the initial week of next month, with Fraxscan by Etherscan providing support on day 1. Following the debut, a multitude of projects is expected to emerge, marking it as a significant rollup release for the year.

Looking Ahead

This addition will expand the existing product suite of the protocol, including FRAX, a fully collateralized algorithmic stablecoin, a lending platform, an automated market maker, an inflation-linked stablecoin (FPI), and the liquid staking token frxETH. As of the latest update, FRAX boasts a market cap of $647 million, ranking as the seventh-largest stablecoin globally.

Curve, a decentralized exchange with a focus on stablecoins, has proposed integrating its exchange functionalities onto Fraxtal. Layer 2, a secondary framework addressing blockchain limitations, gained momentum following Ethereum network congestion issues during the 2021 bull market.

Plenty Of Potential

Fraxtal will also employ rollups technology, conducting transactions off the Ethereum mainnet, consolidating data, compressing it, and then transmitting it back to the mainnet. The liquid staking token frxETH will fuel layer 2 and serve as a gas for the chain, where gas represents the transaction execution fee.

Kazemian envisions the upcoming debut to be impactful, with expectations of attracting several hundred million dollars in crypto assets before long. The CEO anticipates a total value locked of at least nine figures in the first month and aims for over $1 billion in Q1, positioning Fraxtal among the top five chains if well-received.