Frax Ether (FRXETH)

Staking and Yield

Frax Ether is a liquid ETH staking derivative that lets users stake their ETH and still keep it liquid. This means you can earn staking rewards on your ETH without locking it up or needing to run a validator node.

Liquidity and Trading

Frax Ether tokens (frxETH) can be freely traded or used in DeFi apps. They act like a stablecoin pegged to ETH, allowing users to move or use their staked ETH easily.

DeFi Integration

frxETH can be used in decentralized finance for lending, borrowing, or providing liquidity on platforms like Curve. This makes it easier to earn extra rewards or use staked ETH in other financial activities.

Simplified Staking

The Frax ETH Minter allows users to convert ETH into frxETH in any amount, removing the usual 32 ETH minimum and technical setup needed for solo staking.

Yield Accrual

There is a version called sfrxETH that accrues staking rewards over time, distributing profits from Frax validators to holders.

Overall, Frax Ether helps users earn staking rewards on ETH while keeping their tokens flexible and usable in the DeFi ecosystem.

Pros

• Frax Ether is a liquid ETH staking derivative that makes earning staking rewards simple and accessible without running your own validator.
• It allows users to earn staking yield on any amount of ETH and withdraw at any time and size.
• The system is DeFi-native, meaning it works well with other decentralized finance apps for more flexibility.
• Staking rewards and profits from validators are distributed to holders of staked Frax Ether (sfrxETH), which compounds yield automatically.
• Frax Ether uses a stablecoin-like token (frxETH) pegged closely to ETH, making it easy to track value.
• A small protocol fee (8%) supports the Frax ecosystem and an insurance fund (2%) helps maintain stability.

Cons

• The protocol has some centralization aspects, such as admin control over minting frxETH and managing validators.
• It relies heavily on smart contracts and oracles, which means it depends on code and external data sources working correctly.
• The peg of frxETH to ETH is "loose," meaning it can fluctuate slightly within a small range (about 1%).
• Users holding frxETH alone do not earn staking rewards unless they convert to sfrxETH.

For more details, visit the official Frax Ether documentation at docs.frax.com.

Founders of Frax Ether

Frax Ether was created by the team behind Frax Finance. The main founders are Sam Kazemian and Travis Moore. They started the Frax project in 2019, with contributions from others like Kedar Iyer and Michael Gruen. Sam Kazemian is known as the lead founder, and Travis Moore serves as co-founder and CTO. Together, they developed Frax Ether as part of the Frax ecosystem.

Investors in Frax Ether

Frax Ether is supported by a variety of investors mainly from the decentralized finance (DeFi) community and crypto enthusiasts who participate in Ethereum staking. These include:

• Individual Stakers: People who deposit ETH to receive Frax Ether tokens and earn staking rewards.
• DeFi Users: Traders and liquidity providers who use Frax Ether in DeFi protocols like Curve to earn additional fees.
• Crypto Funds and Protocols: Various crypto investment funds and DeFi projects that integrate or hold Frax Ether as part of their staking or liquidity strategies.

Frax Ether is part of the Frax Finance ecosystem, which is backed by the Frax community and holders of the Frax token (FXS). The project gains capital from users attracted by its liquid staking features and yield opportunities.

For more details, visit the official Frax Finance website: https://frax.finance

Halal Status of Frax Ether

Yes, Frax Ether is generally considered halal. This is because it represents actual ownership of staked ETH, which aligns with halal principles by avoiding interest (riba) and speculative gambling (maysir). It functions as a liquid staking derivative within the Frax Finance ecosystem, providing a way to earn yield on Ethereum without violating Islamic finance rules.

Reasoning

• Frax Ether is backed by staked ETH, representing real assets.
• It is used for utility and earning staking rewards, not for interest-based lending.
• Similar to Ethereum’s native token Ether, which many scholars consider halal due to its utility nature.

For more details, you can visit the Frax Finance website or consult Islamic finance resources that analyze crypto tokens.