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# System prepended metadata

title: Frax <> Umami <> GMX

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# Frax <> Umami <> GMX

## Topics Discussed (UMAMI <> FRAX)

### Proposal for GMX to increase FRAX GLP Allocation

This would be very beneficial for GMX, Frax and Umami. Details on potential benefits of such a partnership are outlined below. 

### Timelocked Guage vault w/ Umami for FXS rewards

Frax vaults would easily be launched on Umami once GLP increases the target weights for it within the pool. These could then provide a very attractive savings-account like product and a sinkhole for Frax. Further FXS incentives could also be used to stake and timelock these vault tokens for longer periods of time, allowing more control over Frax supply for Frax the protocol.

### Fraxlend for vault tokens

Frax has a new lending protocol comign called Fraxlend where they will be able to mint Frax to be lent against certain collateral types. Umami provides attractive yield-bearing collateral which are also super safe since they come in the form of USDC, ETH and BTC with the added benefit of tokenising the previously untokenised GLP. This would provide an edge to Fraxlend if they were added as collateral types since they would be extreamly attractive even in a bear market, especially when users are able to loop their already high yield.

### GMX AMO

Once Frax is a higher weight into GLP, Frax the protocol will be able to mint/burn Frax directly into GLP to create revenue for itself and use it to bolster its own peg. This could help GLP to keep correctly balanced w/ re: to stable/non-stable asset allocations.

To expand, GMX's current rebalancing mechanism for GLP is a simple yet relatively inneffective one. The fees charged to those entering or exiting GLP and trading using it are incentisation mechanisms to guide GLP to the target weights, but does not force it. Frax could provide that hard level to allow adding more stablecoins to GLP when needed by GMX (i.e. in periods of traders being net short) and burning Frax in the opposite situations. Also this will mean that IL will be minimised further in GLP making the Umami vaults even more attractive. A win-win scenario for all protocols involved!

![](https://i.imgur.com/J0V0dbS.png)


### FRAX liquidity on Uni v3 from Umami for vault tokens

Frax could help to incentivise some of the Umami vault tokens through FXS incentives or Revenue kickback and in return Umami would provide that liqudity in Frax:token pairs, adding yet another usecase and sinkhole for Frax. This will also make the Fraxlend partnership for the vault tokens all the more desirable and effective.