This proposal suggests the strategic deployment of Curve on Fraxtal, the dedicated modular rollup and blockchain developed by Frax Finance. It aims to extend the successful partnership between Frax Finance and Curve, leveraging the innovative features of both platforms to enhance DeFi liquidity and functionality on Fraxtal.
Background and Motivation:
Frax Finance has been a committed positive-sum ally to Curve and Convex for almost three years, with its Curve Automated Market Operator (AMO) being a hallmark innovation in the realm of DeFi and stablecoins. This AMO smart contract has revolutionized liquidity management by maintaining balance in Curve pools through deterministic, on-chain mechanisms. It enables the Frax protocol to not only deploy its protocol-owned liquidity on Curve but also to earn transaction fee revenue, CRV, and CVX rewards.
Fraxtal is built as an Ethereum L2, with the security, stability, and scalability needed to power smart contracts with a strong emphasis on decentralized finance. As we expand onto Fraxtal, Frax Finance plans to continue leveraging the Curve AMO as the primary tool for maintaining the peg of its stablecoins. We will fully support the FRAXBP and WETHER programs on Fraxtal, incentivizing voters to allocate their votes towards Frax pools, thereby solidifying the partnership and enhancing the liquidity ecosystem.
Additionally, if Curve deploys on launch or soon thereafter, then Curve LPs/TVL will qualify for additional FXTL points and blockspace incentives reserved for strategic launch partners for Fraxtal.
- Integration on Fraxtal: Deploying Curve’s renowned exchange functionalities onto Fraxtal
- Continued Partnership and Support: Frax will utilize Curve AMO as the main PEG control mechanism for its stablecoins on Fraxtal, ensuring robust and efficient liquidity management.
- Curve TVL earning additional FXTL points and veFXS blockspace incentives.
- Incentive Programs: Enforcing the FRAXBP and WETHER programs on Fraxtal to motivate voters towards prioritizing Frax pools.