Comparing Data of Two Major DeFi Protocols: Maker vs. Frax – Who Takes the Lead?

Comparing Data of Two Major DeFi Protocols: Maker vs. Frax - Who Takes the Lead?

Comparing Data of Two Major DeFi Protocols: Maker vs. Frax - Who Takes the Lead?

Writing: Wajahat Mughal
Translation: Deep Tide TechFlow

DeFi researcher Wajahat Mughal compares two DeFi and RWA leaders, Maker and Frax Finance, from multiple dimensions in this article, including their main businesses, profitability, revenue sources, protocol income situation, governance tokens, and future developments. Which one will be better?

Maker and Frax are two major players in the DeFi field. Maker provides decentralized stablecoin DAI with over-collateralization, supported by ETH, stablecoins, and RWAs (with the majority being US Treasury bonds). Frax provides decentralized stablecoin FRAX and a range of financial products built around it.

The collateral for DAI includes ETH, stablecoins, and RWAs, with the majority being US Treasury bonds. The collateral for FRAX is about to change. It is currently moving towards 100% CR and will no longer be supported by FXS. The recently added sFRAX and upcoming FXB (bonds) will provide RWA support.

Income

The current supply of sDAI is 1.73 billion tokens, with a yield of 5%. The current supply of sFRAX is 41 million tokens, with a yield of over 6.5%. It can be seen that DAI has a dominant position in terms of supply, but currently, Frax has a higher yield.

Revenue Sources

The yield of sDAI comes from various RWA T-Bill yields, which can be seen from the custodian institutions. sFRAX earns IORB interest rates from overnight interest rate accounts, held by FinresPBC, and then the revenue is passed on to sFRAX.

MKR and FXS

MKR’s market value is $1.3 billion, used for continuous repurchase of protocol income. FXS’s market value is $450 million, earned from the protocol (currently, all efforts are being made to increase the CR to 100%).

Future

Both are excellent protocols. Maker is still the king of cash, while Frax continues to add innovative products to its ecosystem. The next steps for Maker include token reshaping, decentralized stablecoin cancellation, subDAO activation, AI integration, and ultimately, the Maker Chain. For Frax, it includes Frax bonds, frxETH collateral product updates, and the new L2 Frax Chain on Ethereum.

Personally, I prefer Frax, and I like the ecosystem they are building.

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