We’re excited to announce that Frax’s governance process has approved a partnership with Ondo!
This partnership will build on Ondo’s Liquidity-as-a-Service offering and enable the use of $FRAX (provided by the protocol itself) as liquidity for token issuers.
Based on the design of the proposal, a portion of the future algorithmic expansion of the FRAX stablecoin will be minted into Frax-as-a-Service vaults as needed. This means that Frax will have no upfront costs to participate.
In addition, the Frax community has generously agreed to incentivize DAOs and token issuers to use Frax-as-a-Service by providing $FXS incentives. If you know of or represent a DAO that might be a good fit for Frax-as-a-Service, please reach out to our team!
Frax-as-a-Service (“FaaS”) is an offering from Frax and Ondo to make it possible for projects issuing tokens to increase the liquidity in their native tokens on decentralized exchanges by providing liquidity themselves. With FaaS, a project can deposit its token into an Ondo liquidity vault with a flexible duration. Ondo and Frax will match those deposits with an equivalent amount of FRAX to form a liquidity pair. In exchange for providing FRAX, the Frax DAO will receive a fixed 5% APR return on its provided liquidity. We plan to leverage Frax’s success at building a multichain ecosystem and hope to deploy on several other chains starting with Polygon.
Ondo provides several advantages over existing liquidity solutions. With Ondo, token issuers earn trading fees and rewards which reduce (or even negate) impermanent loss (IL) risk and the cost of capital. With small adjustments, Ondo vaults are well-suited to facilitating direct listings, establishing the first liquidity for a token. Direct listings could eventually replace or complement IDOs. We are excited to work directly with Frax to build out these future offerings.
Ondo Finance is connecting and servicing investors and token issuers in DeFi with on-chain investment banking services. Ondo is being developed by a team of traditional banking veterans and DeFi experts. The team includes alumni from Goldman Sachs Digital Assets, Facebook, BadgerDAO, Snap, private equity funds, hedge funds, and various venture-backed start-ups.
This announcement has been written and published by Ondo Finance Inc. and provides no guarantee, commitment, or undertaking to utilize any of its assets, funds, properties or personnel, Ondo Protocol users or other protocol participants. Ondo Finance does not owe, and does not intend to assume, any duties or obligations to Ondo Protocol users or participants, other than duties or obligations arising under laws of general application, such as non-waivable torts.
To the maximum extent permitted by applicable law, all software relating to Ondo Protocol is being provided on an as-is, where-is basis, with no representations or warranties being made to Ondo Protocol participants and with no liability to Ondo Finance or any other person involved in the development of Ondo Protocol. The statements set forth in this announcement also are not intended to be representations, warranties, guarantees or assumptions of duty or liability of any kind, and Ondo Finance hereby disclaims the foregoing and will not be liable for any damages arising from use of Ondo Protocol. In the event of any conflict or inconsistency between this announcement or any other communication and the terms of any software license involved in Ondo Protocol, the terms of the software license shall govern to the exclusion of this announcement and such other communications.
The forward-looking statements in this announcement are subject to numerous assumptions, risks and uncertainties which are subject to change over time. Such assumptions, risks and uncertainties could cause actual results or developments to differ materially from the results and developments anticipated by us. Even if our anticipated results and developments are realized, such results and developments may nevertheless fail to achieve any or all of the expected benefits anticipated by this announcement. We reserve the right to change the plans, expectations and intentions stated and implied herein at any time and for any reason or no reason, in our sole and absolute discretion, and we undertake no obligation to update publicly or revise any forward-looking statement, whether as a result of new information, future developments or otherwise.
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