sfrxUSD, issued by the Frax Protocol smart contracts under onchain frxGov governance with compliance and collateral management assigned to Financial Reserves and Asset Exploration Inc, is a tokenized yield vault accruing returns on staked frxUSD [S1].

sfrxUSD is the yield-bearing staked form of frxUSD, structured as an ERC-4626 vault whose exchange rate against frxUSD increases as yield accrues [S2]. Yield is generated from idle frxUSD earning the Federal Reserve Interest on Reserve Balances and U.S. Treasury bill yield, lending allocations across Fraxlend, Resupply, Aave and Morpho, and carry trades using Ethena USDe and Superstate USCC, with dynamic reallocation across these strategies [S2].

Frax operates two independent monetary systems with distinct portfolios and liabilities; sfrxUSD operates on a fully separate balance sheet isolated from both Legacy FRAX and frxUSD reserves [S2]. The underlying frxUSD is fiat-redeemable and backed 1:1 by cash-equivalent reserves, predominantly tokenized U.S. Treasury fund instruments held by governance-approved enshrined custodians [S3]. Under governance proposal FIP-432, Financial Reserves and Asset Exploration Inc, a public benefit corporation referred to as FRAX Inc, holds reserves in segregated brokerage accounts and does not rehypothecate, leverage, or pledge them [S1]. sfrxUSD is conditionally redeemable and not fully redeemable at all times [S2].

sfrxUSD follows the ERC-4626 vault standard [S2], while frxUSD is natively supported on Ethereum and Fraxtal and represented as a LayerZero Omnichain Fungible Token on chains including Solana, Linea and Sonic [S3]. frxUSD is minted when a custodian deposits provable cash-equivalent reserves into a frxUSDCustodian contract and burned on redemption, settling intra-business-day or next business day [S3].

<Sources
  retrievedAt="2026-06-21"
  items={[
    { id: "S1", url: "https://gov.frax.finance/t/fip-432-transfer-of-compliance-collateral-management-of-frxusd-to-frax-inc/3748" },
    { id: "S2", url: "https://gov.frax.finance/t/fip-430-preparation-for-frxusd-payment-stablecoin-charter-compliance/3698" },
    { id: "S3", url: "https://docs.frax.finance/?ask=What%20is%20frxUSD%20and%20enshrined%20custodians" },
  ]}
/>


# Asset redemptions methodology

## 1. Overview

The total value of tokenized assets that are burned or returned to issuer-controlled addresses in exchange for offchain collateral assets is measured by the asset redemptions metric. User demand to exit asset positions and reclaim backing collateral is reflected by this metric. Daily redemption volumes are aggregated across all supported blockchains and converted to USD using end-of-day price feeds. A comprehensive view of capital outflows from tokenized assets is provided by this metric.

## 2. Data sources

- **EVM chain events**: ERC-20 token transfers, covering EVM-compatible chains (Ethereum, Arbitrum, Base, Polygon, Optimism, and others)
- **Solana instructions**: SPL token burn instructions and balance changes
- **Non-EVM chain events**: Native token burn events, transaction net flows, and asset pallet events covering Algorand, Cardano, Injective, Near, Polkadot Asset Hub, Ripple, Stacks, Stellar, and Sui
- **Asset metadata**: Token addresses and decimal precision
- **External data**: End-of-day price feeds

## 3. Step-by-step calculation

### Component A: Extract raw redemption and burn events

- **Purpose**: Token destruction or return to issuer custody across all supported blockchains is identified.
- **Logic**: On EVM-compatible chains, ERC-20 `Transfer` events are parsed where the recipient is the zero address or the dead address. On Solana, SPL token `Burn` instructions are parsed. On Algorand, token transfers to non-circulating configuration addresses (such as creator or reserve addresses) are extracted. On Cardano, negative token deltas are derived from transaction outputs and inputs. On Injective, token transfers with a burn event type are selected. On Near, token burn events are extracted. On Polkadot Asset Hub, `Burned` events from the assets pallet are parsed. On Ripple, transaction net flows that result in issuer inflows are identified. On Stacks, token transfers where the recipient address is null are parsed. On Stellar, SEP-41 `sep41_burn` events are extracted. On Sui, negative deltas are derived from total supply changes of treasury control objects.
- **Key fields**: `timestamp` (event time), `token_address` (asset contract address), `amount` (raw quantity)

### Component B: Apply premint corrections

- **Purpose**: Raw burn volumes are adjusted to exclude non-circulating token movements and include circulation exits.
- **Logic**: For supported assets, raw burn volumes are adjusted by subtracting preburns and adding premint redemptions. Preburns, which represent tokens burned directly from issuer-controlled premint addresses without ever entering circulation, are subtracted from the total. Premint redemptions, which represent transfers from circulating addresses back into premint addresses, are added to the total as they represent assets exiting active circulation.
- **Key fields**: `timestamp` (event time), `token_address` (asset contract address), `amount` (corrected quantity)

### Component C: Normalization and USD conversion

- **Purpose**: Token quantities are normalized by decimal precision and converted to USD.
- **Logic**: Daily token-denominated redemption amounts are aggregated by timestamp, chain, and token address. These amounts are normalized by decimal precision retrieved from token metadata. The normalized redemption amounts are then multiplied by end-of-day price feeds sourced from market data providers to calculate the final USD-denominated redemption value. If no redemptions occur on a given day, the daily value is filled with zero values.
- **Key fields**: `timestamp` (day), `chain_id` (blockchain identifier), `token_address` (asset contract address), `amount` (normalized token quantity), `price_usd` (asset price), `value` (USD-denominated redemption value)

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Value of assets redeemed or burned for underlying collateral.

Asset redemptions

Tokenized funds

Users deposit funds into Frax Finance and receive frxUSD stablecoin (previously FRAX).

Frax Finance is the principal architect of frxUSD - a crypto collateralized stablecoin pegged to the US dollar. Frax Finance was founded by Sam Kazemian, Stephen Moore, Jason Huoan & Travis Moore and launched in 2019.

FRAX (previously FXS) tokenholders own and govern the Frax Finance protocol.

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Stablecoin issuers

Frax Stablecoin

Staked Frax USD (sfrxUSD) is a tokenized fund share issued by Frax Stablecoin.

The fund is open-ended and invests in multi-asset.

Retail investors can subscribe and redeem in frxUSD, and holders have a right to redeem at net asset value.

sfrxUSD has been issued on public blockchains since March 2024 and is native to Fraxtal and Ethereum, with bridged versions on four more.

Staked Frax USDsfrxUSD