Summary
Frax Finance is seeking community support for adding sfrxETH market to Compound V3 on Ethereum Mainnet.
Token Asset Name
Frax Staked Ether - sfrxETH
A description of the project and the token
The world’s most innovative decentralized stablecoins and DeFi stablecoin infrastructure.
The Frax ecosystem is a self-sufficient DeFi economy utilizing stablecoins as currency.
Frax Ether is a liquid ETH staking derivative and stablecoin system designed to uniquely leverage the Frax Finance ecosystem to maximize staking yield and smoothen the Ethereum staking process for a simplified, secure, and DeFi-native way to earn interest on ETH.
The Frax Ether system comprises three primary components, Frax Ether (frxETH), Staked Frax Ether (sfrxETH), and the Frax ETH Minter:
sfrxETH is a ERC-4626 vault designed to accrue the staking yield of the Frax ETH validators. At any time, frxETH can be exchanged for sfrxETH by depositing it into the sfrxETH vault, which allows users to earn staking yield on their frxETH. Over time, as validators accrue staking yield, an equivalent amount of frxETH is minted and added to the vault, allowing users to redeem their sfrxETH for a greater amount of frxETH than they deposited.
The exhange rate of frxETH per sfrxETH increases over time as staking rewards are added to the vault. By holding sfrxETH you hold a % claim on an increasing amount of the vault’s frxETH, splitting staking rewards up among sfrxETH holders proportional to their share of the total sfrxETH. This is similar to other autocompounding tokens like Aave’s aUSDC and Compound’s cUSDC.
Benefits to Compound Community
The adoption of sfrxETH on the Compound lending protocol presents numerous benefits to the Compound community. By integrating sfrxETH, which is among the top 5 available Liquid Staking Derivatives (LSDs), Compound will enhance its offerings, providing users with more diverse and yield-generating opportunities. This addition would not only attract a broader user base but also increase the protocol’s total value locked (TVL). Moreover, sfrxETH’s integration brings the advantage of deep liquidity and robust security features, ensuring a resilient and efficient lending and borrowing environment.
Resources
Website: https://frax.finance/
Aggregator: https://facts.frax.finance/
FrxETH Data: Frax Facts
Whitepaper: https://docs.frax.finance/
Telegram: Telegram: Contact @fraxfinance
Discord: Frax Finance
The proposal author & their contact info
Telegram: @jaeyunyi - APAC Growth Lead
Market Risk Assessment
Market Cap of the token*
$629,264,421 USD
Minimum and maximum market cap of the token within the last 6 months.
Minimum:454.66 Million USD
Maximum: 831.56 Million USD
Market Cap of token on Comet markets
N/A
The largest exchanges where the token is listed and its respective liquidity*
Balancer v2 (Ethereum): $11,356,052
It should be noted that frxETH (the underlying asset that sfrxETH is always redeemable for is highly liquid with many Curve pools making sfrxETH have over $100m+ of liquidity. A simple search of Curve pools shows that frxETH is one of the most diversly liquid ETH-pegged assets on mainnet: Curve.fi
- The largest smart contracts balances of tokens and what those contracts do.
- 0x78bB3aEC3d855431bd9289fD98dA13F9ebB7ef15
Fraxlend Pair - FRAX/sfrxETH : 46k sfrxETH
- 0xf69282a7e7ba5428f92F610E7AFa1C0ceDC4E483
Prisma CDP : 32k sfrxETH
- 0x8CA7A5d6f3acd3A7A8bC468a8CD0FB14B6BD28b6
EigenLayer: 25k sfrxETH
- 0x3fF8654D633D4Ea0faE24c52Aec73B4A20D0d0e5
OUSD CDP: 14k sfrxETH
- 0xfA96ad0a9E64261dB86950e2dA362f5572c5c6fd
LLAMMA - crvUSD AMM: 7k sfrxETH
- 0xC2545C68a71F6803264bdE885870fD72D361fB9E
Prisma: 5.7k sfrxETH
- 0xBA12222222228d8Ba445958a75a0704d566BF2C8
Balancer Vault: 4k sfrxETH
- Provide the volatility of the token. Rolling windows of 1,3,6 & 12 month periods would be ideal. For more info see Gauntlet’s volatility guide.
1: $1909 / —
3: $1978 / 1.036
6: $2051 / 1.037
12: $3384 / 1.65
Total supply*
146,880.61
- Emission schedule.
- N/A
Note: Gauntlet will also pull live data to conduct their market risk assessment after the Checklist is submitted.
Decentralization
- How is this asset distributed amongst token holders? List the top 10 holders, the percentage of each holder, and tag any of them if they are known.*
1 0x78bB3aEC…9ebB7ef15
38,904.39158709664416658 26.4871%
FRAXLEND PAIR
2
0x8CA7A5d6…4B6BD28b6
29,270.531374387379303272 19.9281%
$98,975,374.79
EIGENLAYER
3
0xfA96ad0a…572c5c6fd
5,129.826744591435526404 3.4925%
$17,345,996.15
CRVUSD LAMMA POOL
4
0xC2545C68…2D361fB9E
4,133.935417675978983234 2.8145%
$13,978,489.22
PRISMA TROVE/LOAN MANAGER
5
0x6F3F6852…9F695aF13
3,989.215099052143146724 2.7160%
$13,489,131.94
WHALE USER
6
Frax Finance: Comptroller
3,745.050546977374473546 2.5497%
$12,663,513.92
FRAX TREASURY
7
Balancer: Vault
3,018.396007890955725633 2.0550%
$10,206,404.26
BALANCER LIQUIDITY POOL
8
0x46782D26…861fb4c7D
2,523.00481214458602703 1.7177%
$8,531,288.47
WHALE USER EOA
9
0xcfEEfF21…9d2dF2359
2,129.439478224750985932 1.4498%
$7,200,486.65
FX PROTOCOL LOAN MANAGER
10
0xe5EBcDE1…fDCb747c1
2,000 1.3617%
$6,762,800.00
WHALE USER EOA
- List all of the privileged roles in the token contract. This can include whitelisted EOAs, Multi-sigs or DAOs.*
- It isn’t owned.
- Is it pausable?*
- No
- Does it have a blacklist or whitelist?*
- No
Smart contract risks
Codebase & On-chain Activity:
- Provide a Github repository for the underlying token contracts*
Provide a test suite with code coverage.
- Provide Etherscan links with verified contracts*
- $4,110.48 | Staked Frax Ether (sfrxETH) Token Tracker | Etherscan
- Give the age of the token in days*
- 544 days
- Given the number of transactions in the contract to date*
- 15322
Security Posture:
- What audits, if any, were performed? Provide links to the reports if they exist.*
-
Does the project have an active bug bounty program?*
-
Provide emergency contacts with their responsiveness levels and response availabilities*
-
Sam Kazemian 24/7/365 [TG Telegram: Contact @samkazemian]
-
Travis Moore 24/7/365 [TG Telegram: Contact @FortisFortuna_89]
List additional security and formal verification tools used in development
N/A
- List all monitoring services used by the token, if any.
- Misc backend / validator monitoring tools
Multi-Chain Strategy
- Will the token include implementations on other networks*?
- Yes
If so, will the tokens be natively minted on the other networks or bridged across?
Bridged. OP-style L1StandardBridge/L2StandardBridge for Fraxtal, Fraxferry for the rest.
It should be noted that sfrxETH is NOT a bridge vulnerable on Ethereum mainnet. That means it has zero bridge requirements and is a fully natively issued token on Ethereum mainnet. No bridge hack/vulnerability would affect the supply or minting of sfrxETH. So for Ethereum lending integration, the token is extremely safe.
Are there any mitigations in the contracts in case a bridge becomes inoperable or compromised?
We control both bridges and presumably would do a Snapshot/airdrop or similar scheme to compensate affected users. We can pause the bridges too.
Token contract Behavior:
- Does the token have more than one address1?*
No, not a proxy either
- Does the token use a compiler version greater than 0.8.0 or the SafeMath? If not, explain how the protocol deals with possible overflows and underflows*
- v0.8.16+commit.07a7930e
- During the execution of the token’s functions, does the token execute external code chosen by the caller or receiver?2 If so, please explain the reasoning behind this decision*
- No
- How does the token contract deviate from a standard implementation of ERC20? Any additional features that the Compound DAO should know about?*
- Is it burneable?*
- It is ERC-4626. It cannot be burned, just redeemed for frxETH
- Does the token contract have a fallback function? If so, when does it revert?3
- Contract is not payable
- Does it have a fixed supply? If no, who can mint?*
- No. ERC-4626 so people can convert/redeem frxETH <> sfrxETH.
Is it a rebasing token?*
No
-
Does the token charge fees on transfers?*
-
No
-
Does it implements any transfer hooks? Or hooks on any method?*
-
No
-
Is the contract performing arbitrary delegatecalls?* If the answer is yes, indicate who can make these calls and to what contracts.
-
No
-
Is it flash mintable? If yes, please provide more information on this feature*
-
No
-
Is it flash loanable? If yes, please indicate who offers the service.*
-
No
-
What are the typical gas costs for calling each of the standard ERC20 functions?
-
Redeem: 93.1K, Transfer: 44.7K
Price Feed Behavior
- Is the price feed supported by ChainLink?
- No.
If not, what entity is responsible for posting price updates? List names and addresses which may update the price feed
SfrxEthFraxOracle: SfrxEthFraxOracle | Address 0xb9af7723cfbd4469a7e8aa60b93428d648bda99d | Etherscan
-
How often will price updates be posted?
-
sfrxETH oracle is onchain and completely decentralized, anyone can ping for the most recent price but an offchain oracle job always updates either once every 24 hours latest or 1% deviation. Additionally, the oracle is bounded at .70 ETH price to prevent manipulation since sfrxETH is always redeemable and fully backed by frxETH→ETH.
-
At what price difference threshold will price updates be posted?
1% deviation. -
Can the AggregatorV3Interface functions for this price feed ever revert when called?
No -
Does the bytecode of the custom price feed match an audited version?
Yes
Upgradability:
- Is it upgradeable?* If so:
- No
Who is authorized to make an upgrade?
N/A
Can an upgrade happen instantaneously or is there a time-lock delay?
N/A
Which components are upgradable?
N/A
How does the upgradeability design work? Who manages it and are how upgrades performed?
N/A
Does it emit an event when the implementation is updated?
N/A
Initial Requirements
Set collateral factor to 0.70
Set established supply cap if necessary. Supply cap and collateral factor determine total borrowing power, and maximum liquidateable amount for the token.
20,000 frxETH
