Summary
Add frxUSD as a crvUSD PegKeeper utilizing the frxUSD/crvUSD pool. Set the initial debt ceiling for the PegKeeper at 3m frxUSD.
Abstract
Vote actions as part of this proposal include:
- Increase frxUSD PK caller_share from 20% to 50%
- Set frxUSD PK debt ceiling to 3m in the Controller Factory
- Add frxUSD PK to the Pegkeeper Regulator
- Add frxUSD PK to Pegkeepers in active crvUSD Monetary Policies: non-yielding, yielding, sfrxETH
- Add the frxUSD/crvUSD oracle proxy to the aggregated price of crvUSD
This vote seeks to add frxUSD as a crvUSD PegKeeper to be used alongside USDC, USDT, and PYUSD, which currently have debt ceilings of 45m, 45m, and 15m, respectively. The initial debt ceiling of 3m frxUSD is recommended by LlamaRisk following a comprehensive risk evaluation of frxUSD.
The caller_share is increased to 50% to offer additional incentives to update the pegkeeper- this is the portion of the Pegkeeper profit that is given to the caller.
Adding frxUSD PegKeeper to the PegKeeper Regulator allows it to operate within the PegKeeper framework, governed by the parameters defined in the Regulator.
Adding frxUSD PegKeeper to the crvUSD monetary policies will inform borrow rates based in part on the utilization of the frxUSD PegKeeper in addition to the other active PegKeepers. The proportion of Pegkeeper debt to overall debt informs borrow rates in crvUSD’s dynamic IRM, so this addition allows the debt from frxUSD pk to accurately set crvUSD borrow rates.
The aggregated price of crvUSD serves as a proxy for USD pricing and is used in the crvUSD oracles in mint markets and lend markets. It aggregates the price of crvUSD with respect to the oracle price of its constituent pools. Adding the frxUSD/crvUSD price oracle to this contract allows this pool to contribute to the aggregated USD price calculation of crvUSD.
Motivation
The frxUSD/crvUSD pool was recently seeded and now has over $1.7m in TVL. The pool also receives gauge weighting for CRV emissions, further incentivizing liquidity.
LlamaRisk have conducted a comprehensive risk evaluation of frxUSD for Pegkeeper onboarding purposes. An excerpt from the conclusion is provided below.
Onboard frxUSD as a crvUSD Pegkeeper with debt ceiling set to $3m.
Frax has long been an aligned participant within the Curve ecosystem. As one of the earliest adopters and most consistent users of Curve’s liquidity infrastructure, Frax has demonstrated sustained integration, particularly through its gauge weight participation, AMO strategies, and Curve LP incentives. The team behind Frax has a multi-year track record of reliable protocol operation, including successful deployment of complex mechanisms such as FRAX, FraxLend, and now frxUSD. This continuity and shared ecosystem presence offer Curve DAO a level of familiarity and institutional maturity not often found among newer stablecoin issuers.
frxUSD itself is a relatively recent product, but has already exhibited strong performance characteristics in terms of peg stability and capital efficiency. On Ethereum, frxUSD maintains a tight peg adherence, with deviations beyond ±10 basis points occurring infrequently and resolving promptly. Liquidity conditions are also favorable, with over $10 million in DEX liquidity and low slippage across most trade sizes. This is particularly notable given frxUSD’s smaller overall market cap and reflects the protocol’s design around capital-efficient reserve deployment and incentive alignment.
That said, certain limitations suggest caution in scaling Pegkeeper exposure too quickly. frxUSD remains at an early stage of adoption, with limited active users and much of its circulating supply staked passively in sfrxUSD. While its reserve assets—primarily tokenized U.S. Treasuries—are of high quality, the transparency of reserve composition, allocation, and associated yield strategies remains incomplete. The lack of public smart contract audits for frxUSD and sfrxUSD also introduces technical risk, particularly given the upgradeable proxy architecture and admin-controlled contract design. Additionally, frxUSD has yet to undergo live testing through a full market cycle or liquidity stress event.
Given these considerations, we recommend onboarding frxUSD as a crvUSD Pegkeeper asset with an initial debt ceiling of $3 million. This recommendation reflects the strengths of the Frax ecosystem—namely, its Curve alignment, peg robustness, and high collateral quality—while also acknowledging the prudent need to limit exposure at this stage due to frxUSD’s relatively short track record, lapses in transparent operation, and still-maturing user adoption.
A $3 million ceiling allows Curve to safely diversify its Pegkeeper basket with a uniquely designed stablecoin that is poised for GENIUS compliance, while preserving flexibility to scale the ceiling upward as frxUSD continues to demonstrate strong performance, greater transparency, and deeper ecosystem integration. We view this as a measured, risk-conscious first step in supporting an issuer that shares Curve’s long-term ethos and infrastructure focus.
Specification
POOL_NG_PROXY = "0x3f28e80Fa80D9D210afB7BbBABb8295F7E7ff2Dc"
PK = "0x338Cb2D827112d989A861cDe87CD9FfD913A1f9D"
FACTORY = "0xC9332fdCB1C491Dcc683bAe86Fe3cb70360738BC"
REGULATOR = "0x36a04CAffc681fa179558B2Aaba30395CDdd855f"
debt_ceiling = 3_000_000 * 10 ** 18
MONETARY_POLICIES = [
"0x8c5A7F011f733fBb0A6c969c058716d5CE9bc933", # wBTC, tBTC, cbBTC, ETH
"0x8D76F31E7C3b8f637131dF15D9b4a3F8ba93bd75", # lbtc, wstETH, sfrxETH v2, weeth
"0xc684432FD6322c6D58b6bC5d28B18569aA0AD0A1", # sfrxETH v1
]
AGGREGATE_ORACLES = [
"0x18672b1b0c623a30089A280Ed9256379fb0E4E62",
# "0xe5Afcf332a5457E8FafCD668BcE3dF953762Dfe7", # sfrxETH v1, take care of it
]
ACTIONS = [
(PK, "set_new_caller_share", 50000), # Smaller pools need higher caller_share
(FACTORY, "set_debt_ceiling", PK, debt_ceiling),
(REGULATOR, "add_peg_keepers", [PK]),
*[(m_policy, "add_peg_keeper", PK) for m_policy in MONETARY_POLICIES],
*[(oracle, "add_price_pair", POOL_NG_PROXY) for oracle in AGGREGATE_ORACLES],
]