Frax Q3 2026: Building the Foundation for Frontier Finance
Frax's Q3 2026 report: $1.2B of frxUSD volume, borrowed frxUSD up 83%, sfrxUSD 100+ bps over T-bills, FRAX buybacks, and the balance sheets.
This is Frax's report for the third quarter of 2026, covering 1 July to 30 September. It sets out what the business earned, how frxUSD and sfrxUSD performed, what we are building next, and the balance sheet behind each product.
The quarter at a glance
The Frax flywheel is taking shape. Net revenue was $0.64M on a $2.0M recurring run rate. frxUSD moved $1.2B in one quarter, borrowed frxUSD grew from $16.5M to $30.3M, and frxUSD M2 money supply reached $133.6M. Frax returned $1.93M in yield to holders and partners, and sfrxUSD realized about 5.0%, more than 100 bps over T-bills.
- Enterprise demand is here. S&P 500 companies are under contract for FraxPay, on track to become our largest line of business.
- Demand is expanding beyond supply. Borrowed frxUSD grew 83% as the stablecoin became more deeply integrated into DeFi credit markets.
- Leading yield products. sfrxUSD now earns more than 100 bps over the Treasury rate. sfrxETH out-earned major ETH liquid staking peers in all five measured quarters.
- One connected financial network. Institutions mint frxUSD on FraxNet, and our lending, RWA, branded, and FX partners are verified on it. Each one makes the network more useful.
Financial performance
Gross revenue was $2.59M. After the yield paid to sfrxETH holders and its insurance fund, to sfrxUSD holders, and to frxUSD partners, net revenue was $0.64M. Q3 is the first quarter we report on this basis. It sets the baseline every future quarter is measured against.
Core operations cost $1.38M in the quarter, about $392K a month in recurring costs, and they run a dollar backed by $104.6M in reserves at 30 September.
frxUSD
frxUSD volume reached $1.2B in Q3 on a $110M base. It is a fully backed dollar that institutions mint 1:1 on FraxNet and DeFi puts to work. Holders minted, redeemed, traded, bridged, and lent $1.2B of frxUSD in one quarter, 11.4x the float.
frxUSD is the most positive-sum stablecoin. Frax shares reserve yield with the venues that hold and use frxUSD, and partners earned $1M in reserve yield in Q3.
The PegKeeper pays for its own liquidity. Stablecoin issuers pair with frxUSD to keep their peg, and the reserve yield funds the pool. 28 stablecoin issuers now pair with frxUSD, with 4 new in Q3.
Borrowed frxUSD grew 83% in one quarter. Top lending venues accepting it builds trust, borrowing puts it to work, and as more sinks open, frxUSD stays frxUSD longer.
frxUSD now mints institutional RWAs. Midas brings Fasanara's credit funds onchain, Gearbox offers one-click leverage on them, and frxUSD mints the funds and finances the leverage.
frxUSD is the dollar leg of onchain FX. Onchain volumes are still early, but these pools are the foundation for companies moving FX onchain for 24/7 settlement.
sfrxUSD
sfrxUSD now earns more than 100 bps over the Treasury rate. It is a savings dollar with a Treasury-rate floor that DeFi also uses as collateral, and 64% of it is posted as collateral. People don't just hold sfrxUSD. They borrow against it.
Branded stablecoins and FraxPay
Frax is building the infrastructure behind the next generation of stablecoins. Any company can launch its own stablecoin on the frxUSD stack, with reserves, liquidity, and the FraxNet network behind it from day one.
Frax is building the platform for stablecoin payments. FraxPay brings best-in-class regulated payment services together on one platform for enterprises, with frxUSD at the core. S&P 500 companies are under contract, and FraxPay is set to become our largest line of business.
FraxNet
FraxNet is the operating system for frontier finance. Participants connect once, then reach every application and every Frax dollar through one financial network. Our edge is the network, not any single product. Each integration adds utility for participants already connected.
FRAX and sfrxETH
FRAX has a finite supply and growing utility across the Frax ecosystem: a 143M supply cap, no perpetual tail emissions, and 12.4M FRAX locked in veFRAX.
sfrxETH is a top 10 ETH liquid staking token, and the top performer since launch, with a 4.07% APR since October 2022.
frxETH revenue now buys and burns FRAX. From 1 October, the full 8% frxETH protocol fee buys FRAX on the open market, and every FRAX bought is burned.
Security
Five years without a smart contract security incident. Frax's protocol contracts have run since 2020 without a security incident, and the latest audits from Zellic and CODESPECT found no critical or high findings.
Q4 priorities
Q4 is about turning infrastructure into adoption. More users. More utility. More network activity. We will revisit each target here next quarter.
Balance sheets
Each product has its own balance sheet, shown here as published on Frax's transparency dashboard at the time of writing. They are informational. LFRAX is issued separately from frxUSD, with its own balance sheet.
frxUSD, sfrxUSD, and LFRAX were read on 12 November 2026 at 20:43 UTC. frxETH was read at 21:01 UTC and is shown in ETH.
frxUSD
| USD | |
|---|---|
| Assets | |
| WTGXX held in Frax Inc’s BitGo Trust Account | $53,064,011 |
| BUIDL held in frxUSD redemption contract | $15,894,450 |
| WTGXX held in frxUSD redemption contract | $14,645,972 |
| USTB held in frxUSD redemption contract | $11,520,799 |
| USD at Erebor, frxUSD reserve account | $2,005,530 |
| AUSD held in frxUSD redemption contract | $98,779 |
| Other cash, under $1K | $4 |
| RWA assets total | $97,229,545 |
| Total assets | $97,229,545 |
| Liabilities | |
| Circulating supply of frxUSD on Ethereum | $74,902,453 |
| Circulating supply of frxUSD on Fraxtal | $19,308,714 |
| Total liabilities | $94,211,167 |
| Balance | +$3,018,378 |
| Assets / liabilities | 103.2% |
sfrxUSD
| USD | |
|---|---|
| Assets | |
| Underlying frxUSD in Aave V4 | $16,310,947 |
| frxUSD staked in Convex frxUSD/sfrxUSD | $7,552,413 |
| Underlying frxUSD in Fraxlend sfrxETH/frxUSD | $4,360,338 |
| Underlying frxUSD in KPK RWA Gearbox frxUSD Pool | $2,005,197 |
| frxUSD in the sfrxUSD mint-redeemer, Fraxtal | $1,551,427 |
| Underlying frxUSD in Fraxlend sfrxUSD/frxUSD | $624,889 |
| Other frxUSD positions | $846,429 |
| frxUSD total | $33,251,641 |
| USDT directly held in unstaked Curve LP | $889,152 |
| reUSD staked in Convex sfrxUSD/reUSD | $506,379 |
| Other positions | $140,193 |
| All others total | $1,535,723 |
| Total assets | $34,787,364 |
| Liabilities | |
| Circulating supply of sfrxUSD on Ethereum | $29,522,157 |
| Circulating supply of sfrxUSD on Fraxtal | $5,211,974 |
| Total liabilities | $34,734,130 |
| Balance | +$53,234 |
| Assets / liabilities | 100.2% |
Legacy Frax Dollar (LFRAX)
| USD | |
|---|---|
| Assets | |
| Owned L-FRAX | $50,523,969 |
| Owned L-FRAX/USD | $35,654,436 |
| Owned L-FRAX/Volatile | $6,777,832 |
| Owned Volatile | $6,542,355 |
| Owned USD | $5,483,023 |
| Owned Other | $1,408,250 |
| Owned L-FRAX/FRAX-prev-FXS | $615,755 |
| Owned FRAX-prev-FXS/Volatile | $47,292 |
| Owned assets total | $107,052,911 |
| Lent L-FRAX | $1,031,988 |
| Lent USD | $11 |
| Lent assets total | $1,032,000 |
| Total assets | $108,084,911 |
| Liabilities | |
| L-FRAX circulating supply | $93,053,435 |
| Borrowed USD stablecoins | $19,992,747 |
| FXB circulating supply | $8,391,310 |
| Total liabilities | $121,437,492 |
| Balance | −$13,352,581 |
| Assets / liabilities | 89.0% |
| Locked liquidity | $29,604,628 |
| Balance after locked liquidity | +$16,252,047 |
frxETH
| ETH | |
|---|---|
| Assets | |
| ETH in active validators | 45,059.90 ETH |
| Treasury on Ethereum | 13,485.32 ETH |
| Treasury on Fraxtal | 1,095.30 ETH |
| Redemption queue | 362.76 ETH |
| Minter | 28.00 ETH |
| All assets total | 60,031.28 ETH |
| Total assets | 60,031.28 ETH |
| Liabilities | |
| frxETH supply | 60,027.71 ETH |
| Total liabilities | 60,027.71 ETH |
| Balance | +3.58 ETH |
| Assets / liabilities | 100.0% |
Disclaimer
Informational only. This report is provided for information only. It is not an offer to sell, or a solicitation of an offer to buy, any token, security, or other financial product, and it is not investment, legal, tax, or accounting advice.
Unaudited figures. Financial figures are unaudited and prepared by Frax from onchain data, internal records, and third-party sources. Some figures are estimates or annualized from point-in-time rates, and may be revised.
Forward-looking statements. Statements about plans, targets, products, partnerships, and expected results are forward-looking. They reflect current expectations, involve risks and uncertainties, and are not guarantees of future performance.
Digital assets. Digital assets, including FRAX, frxUSD, sfrxUSD, frxETH, and sfrxETH, carry risk, including the loss of some or all value.