Guide

The peg is maintained through f(x)'s tranche mechanism. ETH collateral is split into a stable tranche (fxUSD) and a leveraged tranche (xPOSITIONs). The Stability Pool acts as a buffer for under-collateralized positions.

fxSAVE is the simplest way to earn yield on fxUSD. Available natively on f(x) Protocol and via third-party integrations including Concentrator, StakeDAO, and Morpho.

Minted fxUSD can be deployed in yield pools for leveraged returns. This carries liquidation risk. This site explains the mechanism but does not recommend any specific strategy.

ETH collateral deposited into f(x) Protocol is divided into two tranches: fxUSD (stable) and xETH (leveraged). xETH absorbs ETH price volatility, shielding fxUSD holders. The Stability Pool acts as an additional buffer — holding fxUSD reserves to absorb under-collateralized positions before they can destabilize the peg. fxUSD maintains a soft peg to the US dollar, maintained through market incentives — not 1:1 USD backing. Deviation is possible in extreme conditions. This site does not assess peg-loss risk.

The Stability Pool holds fxUSD as a reserve for the protocol. When a fxMINT position falls below the minimum collateral ratio, the Stability Pool repays the outstanding fxUSD debt. In return, depositors receive the liquidated ETH or wstETH collateral (typically at a discount to market price) plus any protocol rewards. The pool is yield-bearing but carries liquidation exposure — depositors absorb losses when collateral is liquidated below cost.

APR (Annual Percentage Rate) is the simple annualized return, with no compounding assumed. APY (Annual Percentage Yield) reflects the return when gains are reinvested and compound over the year — a higher figure than APR for the same underlying rate. For auto-compounding vaults like fxSAVE, APY is the more meaningful metric because yield is reinvested continuously. This site always specifies which metric is being displayed for each opportunity.

A looping strategy involves recursively borrowing against deposited collateral and redepositing the borrowed amount to amplify returns. Example: deposit ETH → mint fxUSD via fxMINT → deposit fxUSD into a yield pool → use those returns to mint more fxUSD → repeat. Each loop increases both yield exposure and liquidation risk, since a price drop affects the entire leveraged stack simultaneously. This site explains the concept for informational purposes and does not recommend looping strategies.

Pendle Finance allows yield-bearing tokens to be split into two components: a Principal Token (PT) and a Yield Token (YT). The PT represents the right to redeem the underlying asset at maturity — it trades at a discount and implies a fixed APR over the holding period. The YT captures the variable yield stream. PT-fxSAVE locks in a fixed rate on fxSAVE yield until the Pendle market matures. This structure allows users to hedge variable yield or speculate on future rate movements. PT-fxSAVE is tracked in the data catalog.