What is Frankencoin (ZCHF) Crypto Coin? The Swiss Franc Stablecoin Explained

Most people know about USDT or USDC-stablecoins tied to the U.S. dollar. But what if you want stability tied to something else? Something like the Swiss franc? That’s where Frankencoin (ZCHF) comes in. It’s not just another stablecoin. It’s built to track the Swiss franc, one of the world’s most trusted currencies, without relying on banks or traditional financial middlemen. And unlike most stablecoins, it doesn’t use price oracles. Instead, it uses a clever system of smart contracts, economic incentives, and community governance to stay close to 1 CHF.

How Frankencoin (ZCHF) Works

Frankencoin doesn’t just copy the Swiss franc. It tries to mirror it using crypto. Each ZCHF token is meant to be worth one Swiss franc. But instead of holding physical francs in a vault, it’s backed by other crypto assets-like ETH or other stablecoins-locked in smart contracts on the Ethereum blockchain. This makes it a crypto-backed stablecoin, not a fiat-backed one.

The system has two main tokens: ZCHF and FPS. ZCHF is the stablecoin you trade and use in DeFi. FPS is the governance token. If you hold FPS, you get to vote on changes to the system-like adding new types of collateral or adjusting interest rates. The people who hold FPS have a strong reason to keep ZCHF stable. If the price drops, their collateral gets wiped out. So they’re incentivized to act in the system’s best interest.

One of the most unique things about Frankencoin is that it doesn’t need an oracle. Most stablecoins like USDC check prices from external sources-like CoinGecko or Chainlink. Frankencoin avoids that risk. Instead, it uses a challenge-and-auction system. If someone thinks the collateral is underfunded, they can challenge it. Then, the system auctions off part of the collateral to cover the gap. It’s like a self-correcting mechanism built into the code.

How to Get ZCHF

You can’t just buy ZCHF on Coinbase or Binance like you would Bitcoin. It’s mostly traded on decentralized exchanges like Uniswap or SushiSwap. You’ll need to connect a wallet like MetaMask, swap some ETH or USDC for ZCHF, and you’re in.

But there’s another way: minting. If you have enough collateral, you can create new ZCHF tokens yourself. To do that, you need to either propose a new position (which costs 1,000 ZCHF) or clone an existing one. That 1,000 ZCHF fee is high-about $1,250 at current prices. So it’s not for casual users. It’s meant for serious DeFi participants who want to control their own exposure to the Swiss franc.

Market Performance and Data

As of late November 2025, Frankencoin is trading around $1.25-$1.26 USD. That’s above its target peg of 1 CHF (which is about $1.13 USD). Why the premium? Because demand for Swiss franc exposure in crypto is growing. Investors see it as a hedge against U.S. dollar volatility and inflation.

Market cap hovers around $12-$14 million. That’s tiny compared to USDT’s $110 billion, but it’s the largest Swiss franc stablecoin by far. There are about 9.5 to 11 million ZCHF tokens in circulation, held by over 1,300 wallets. The Total Value Locked (TVL) in the system is over $35 million-meaning that’s how much crypto is locked up as collateral to back the ZCHF in circulation.

Historically, ZCHF hit an all-time high of $1.49 in April 2025. It dipped to $1.07 in January 2025 but recovered quickly. That shows the system can handle stress. The 24-hour trading volume is modest-around $75,000 to $125,000-but steady. Most trades happen on European exchanges like Kriptomat, where ZCHF trades at 1.07 EUR.

Why It’s Different From USDC or USDT

USDC and USDT are simple. You send money to Circle or Tether, they lock it in a bank, and issue tokens. If the bank goes down, so does the stablecoin. Frankencoin has no bank. No central company. No CEO. No audit reports. It’s all code and community.

That makes it riskier-but also more resistant to government pressure. If the U.S. cracks down on dollar stablecoins, ZCHF might still work. It’s built for people who want Swiss neutrality, not American financial infrastructure.

Also, ZCHF’s soft peg allows flexibility. If the Swiss franc strengthens, ZCHF can adjust slowly. Hard-pegged stablecoins can break under pressure. Frankencoin’s design lets it breathe.

Risks You Should Know

This isn’t risk-free. Here’s what can go wrong:

• Smart contract bugs-Even well-audited code can have hidden flaws. One exploit could drain collateral.
• Collateral crash-If ETH or the assets backing ZCHF lose 50% of their value, the system could become undercollateralized.
• Governance failure-If FPS holders don’t act, or if a small group takes control, they might make bad decisions.
• Market panic-During a crypto crash, people might rush to sell ZCHF, breaking the peg temporarily.

The biggest threat? Economic. If the system loses its peg for more than a few hours, confidence could collapse. That’s why the challenge-and-auction system exists-to catch problems early.

Who Uses Frankencoin?

It’s not for everyone. If you’re just buying crypto to hold, ZCHF isn’t for you. But if you’re:

• A DeFi user who wants to earn yield without USD exposure
• A European investor avoiding dollar volatility
• A trader hedging against CHF appreciation
• A developer building a Swiss franc-based dApp

Then ZCHF gives you something no other stablecoin does: decentralized Swiss franc access.

You’ll find it used in lending protocols, liquidity pools, and cross-border DeFi bridges. Some Swiss-based crypto startups use it for payroll or payments to avoid exchange fees and banking delays.

Community and Governance

Frankencoin is run by its users. There’s no company behind it. All changes go through a vote by FPS holders. You can join the conversation on Telegram or follow updates on Twitter (@frankencoinzchf). GitHub is where proposals are written and debated.

This makes it slow to change-but also more democratic. Want to add Bitcoin as collateral? Propose it. Need a new fee structure? Submit a draft. The community decides.

Future of Frankencoin

The roadmap isn’t set by a CEO. It’s set by votes. But trends suggest growth. More DeFi protocols are adding Swiss franc support. Regulatory pressure on USD stablecoins is rising in Europe. And the Swiss franc remains a safe haven in global crises.

If the system keeps its peg and grows its collateral base, ZCHF could become the go-to stablecoin for anyone who wants financial independence from the U.S. dollar. It’s not going to replace USDT. But it doesn’t need to. It just needs to serve its niche well.

Is Frankencoin Worth It?

If you believe in decentralized finance and want exposure to the Swiss franc without a bank, then yes. ZCHF is one of the most innovative stablecoins out there. It’s complex, risky, and niche-but that’s also why it’s valuable.

Don’t invest more than you can afford to lose. But if you’re curious about alternatives to dollar-based stablecoins, ZCHF is one of the few that actually delivers on its promise: a decentralized, crypto-backed Swiss franc.