FEI is an algorithm-based stable coin. The FEI stablecoin has an uncapped supply that tracks demand. FEI enters circulation via sale along a bonding curve. This curve approaches and fixes at the $1 peg. When new demand for FEI arises, users can acquire it by buying on the bonding curve. The price function will start low to reward early adopters for purchasing FEI. Fei Protocol will support the creation of bonding curves denominated in any ERC20. The launch will contain only a single curve denominated in ETH. The mission of Fei Protocol is to create an entirely decentralized stablecoin. Therefore it is critical that no tokens issued by trusted third-parties (e.g. USDC, USDT, wBTC) be used as collateral on the bonding curve. This is a stance the development team hopes will be shared by the governance community post-launch. The ETH bonding curve will have a target FEI supply for bootstrapping before fixing the price at $1. This target is known as Scale; reaching Scale will denote the end of the bootstrapping phase. Scale will be set to 250,000,000 FEI, to be large enough to merit integration with other DeFi protocols. Post-Scale, the bonding curve price will fix at a governance-able buffer above the peg. This price creates a ceiling throughout the ecosystem. Arbitrageurs can buy on the bonding curve and sell on secondary markets if the price is higher elsewhere. Users cannot sell FEI on the bonding curve. Instead, the protocol retains the incoming ETH as Protocol Controlled Value (PCV). Fei Protocol deploys the PCV to create a liquid secondary market where users can sell FEI back into ETH.

Fei Protocol is a DeFi native algorithmic stablecoin that aims to provide a technological solution between overcollateralized decentralized stablecoins and centralized custodial stablecoins. It operates with two crypto assets: FEI stablecoin and TRIBE governance token. FEI is designed to be a capital efficient and fully decentralized stablecoin that maintains liquid secondary markets and earns yield for the protocol. The project attracted significant interest and received $19 million VC investment from prominent names in the crypto community.

Despite some initial issues with the peg, the protocol recovered through governance upgrades. The upcoming Fei v2 is expected to be a major upgrade, featuring 1:1 redeemability for FEI, TRIBE buybacks and backstop, and algorithmic protocol-controlled value management.

Fei Protocol was founded by Joey Santoro, Brianna Montgomery, and Sebastian Delgado. Joey Santoro, the founder and CEO of Fei Labs, has a background in software engineering and crypto. Brianna Montgomery, the project's business lead, has experience in business development and marketing in the blockchain industry. Sebastian Delgado, the third co-founder, has worked as a software engineer at Dharma Labs and Uber. The project has received backing from notable VC funds such as Nascent Capital, Andreessen Horowitz, Coinbase Ventures, and Naval Ravikant.

Fei is a stablecoin with a flexible total supply that adjusts based on demand. As of October 2021, the circulating supply exceeds 600 million FEI tokens.

FEI is freely tradable and available on various exchanges, primarily decentralized exchanges due to the protocol's focus. Some of the exchanges where FEI can be traded include Uniswap, 1INCH, Gate.io, and Ox. FEI can also be bought or sold through the Fei Protocol website, with existing trading pairs including Ethereum, Tether (USDT), and other coins. It is important to conduct your own due diligence when choosing a crypto exchange.

If you are interested in learning more about buying Bitcoin or other cryptocurrencies, you can refer to our starter's guide and explore the top DeFi tokens by market capitalization.