By
Godfrey Benjamin
April 26th, 2024
In a significant move for the DeFi space, Frax Finance has announced its expansion into the Cosmos ecosystem, partnering with Noble, the on-chain asset issuance blockchain.
This partnership marks a pivotal step in bringing the FRAX stablecoin and its staked version, sFRAX, from Ethereum to the Cosmos network, known for its interoperability among approximately 80 blockchains.
A Vision for Expansion and Adoption
At the core of this expansion lies a vision to amplify the adoption of FRAX and sFRAX across a myriad of applications, from trading to savings, payments, and collateral. Noble’s successful integration, which includes a substantial USDC circulation supply of over $195 million, serves as a testament to the potential for seamless asset integration across major Cosmos chains like Osmosis, dYdX, Celestia, Sei, and Injective. This collaboration paints a picture of a more liquid and interoperable Cosmos ecosystem, offering a decentralized stablecoin alternative with a promising outlook for widespread adoption.
Ambitious Targets and Roadmap
Frax Finance‘s expansion is just the beginning; the company has set its sights on a lofty goal of reaching $100 billion in assets by 2026. This aspiration is part of a comprehensive “singularity roadmap” that aims to significantly increase the TVL in its layer 2 blockchain, Fraxtal. With a current TVL of $13.2 million, the roadmap outlines the introduction of new assets and the rejuvenation of a mechanism to share protocol revenue with stakers of its native tokens. This audacious vision strives to fully collateralize the FRAX stablecoin and boost yields on sFRAX.
The Role of Noble in Frax Finance’s Strategy
Noble emerges as a critical player in this strategic expansion, facilitating the issuance of native digital assets within the Cosmos ecosystem. This move not only brings FRAX and sFRAX within the interoperable Cosmos network but also follows Noble’s successful track record, evidenced by its integration of Circle’s USDC. Noble’s technology enables the integration of assets with major Cosmos chains, enhancing the liquidity and utility of FRAX and sFRAX across a wide range of applications.
Frax (FXS) and Cosmos (ATOM) Chart Analysis
Photo: TradingView
The FXS chart depicts a slight recovery, with the price recently crossing above the 20-day EMA, indicating a potential shift in momentum. The positive momentum could also be the result of the expansion news. However, the 50, 100, and 200 EMAs remain overhead, suggesting that the asset is in a broader downtrend. The RSI at 64.86 points to increasing buying pressure, yet it’s not in the overbought territory, allowing room for upward movement. Traders might look for sustained price action above the 20 EMA for confirmation of a trend reversal while watching for resistance at the higher EMAs.
Photo: TradingView
The Cosmos chart indicates a consolidation phase, with the price hovering near the 20-day EMA. While there has been a recent uptick in anticipation of Frax integration into its ecosystem, the price remains below major EMAs, suggesting a bearish trend. The RSI at 57.07 signifies moderate buying interest that hasn’t reached overbought levels. Investors may look for a decisive break above the 20-day EMA for a bullish signal but should be cautious of resistance from higher EMAs.
Overall, both tokens have shown minor positive momentum, which can be based on the anticipation of the integration news, which can facilitate future adoption for both projects.