Frax Finance's Fraxtal to Launch on Layer 2 this February

• Frax Finance Set to Launch Layer 2 Blockchain Fraxtal
• Frax Finance Expands Product Suite
• Understanding Layer 2 in Blockchain
• Rollups Technology and Fraxtal
• Fraxtal's Expectations
• Fraxtal's Unique Blockspace Incentives Feature

Frax Finance Set to Launch Layer 2 Blockchain Fraxtal

Frax$0.997 -0.21% Finance, a well-established decentralized finance (DeFi) protocol and host of one of the world's largest stablecoins, is gearing up for the deployment of its layer 2 blockchain, Fraxtal. The company's CEO and founder, Sam Kazemian, has revealed that the launch is set to take place in the first week of February. In addition, the Etherscan will offer support from day one with Fraxscan, with numerous projects expected to make their debut shortly after the launch. This makes it poised to be one of the most significant rollup releases of this year.

Frax Finance Expands Product Suite

The addition of Fraxtal will expand the existing product offerings of Frax, which include FRAX, a fully collateralized algorithmic stablecoin, a lending platform, an automated market maker, an inflation-linked stablecoin, FPI, and the liquid staking token frxETH. Presently, FRAX boasts a market cap of $647 million, making it the world's seventh-largest stablecoin, according to CoinGecko.

Already, Curve, a decentralized stablecoin-focused decentralized exchange, has proposed plans to implement its exchange functionalities on Fraxatal.

Understanding Layer 2 in Blockchain

Layer 2 serves as a secondary framework or protocol that is developed atop an existing blockchain. It aims to resolve bottlenecks and enhance transaction speed. The urgency to launch layer 2s has increased following congestion issues experienced on the Ethereum$2,315 -2.42% network during the 2021 bull market.

Rollups Technology and Fraxtal

Fraxtal will employ rollups technology that manages transactions off the Ethereum mainnet. It collects the data, compresses it, then sends it back to the mainnet. Frax's liquid staking token, frxETH, will power the layer 2 and also function as gas for the chain. In blockchain terminology, 'gas' refers to the fee paid to carry out a transaction.

Fraxtal's Expectations

Kazemian anticipates Fraxtal to make a significant impact, drawing at least several hundred million dollars in crypto assets within its first month of operation. He forecasts a 9-figure total value locked within the first month and over $1 billion for Q1. He believes this would quickly position Fraxtal among the top 5 chains if it is well received by the market.

Fraxtal's Unique Blockspace Incentives Feature

Fraxtal flaunts a unique blockspace incentives feature known as Flox that Kazemian believes sets it apart from other layer 2s. Blockspace refers to the finite amount of data each block on the blockchain can store. Users and developers who use the chain and pay for the blockspace could earn a steady yield through the incentive program and the weekly FXTL point gauge system.

Edited by Jonathan Stoker