TechFlow news, the Frax Finance community has voted to approve a governance proposal to set the target collateral ratio (CR) of the FRAX stablecoin at 100%, removing algorithmic support for the stablecoin and making FRAX a fully collateralized stablecoin. Additionally, the proposal states that it will not rely on minting FXS to achieve the CR increase; instead, protocol revenue will be retained to fund the increased CR. FXS buybacks will also be paused, while veFXS yields will remain unchanged. Furthermore, the proposal authorizes purchasing $3 million worth of fxsETH monthly to boost stablecoin reserves.
Notably, FRAX was originally designed as a partially collateralized, partially algorithmic stablecoin, with its collateral ratio adjusted based on market demand for FRAX. Source link
