> For the complete documentation index, see [llms.txt](https://fxprotocol.gitbook.io/fx-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://fxprotocol.gitbook.io/fx-docs/faq/what-is-the-difference-between-f-x-protocol-v1-and-v2.md).

# What is the difference between f(x) Protocol V1 and V2?

From a user perspective, v1 offers variable leverage tokens, providing up to 4.3x leverage on ETH and 5.6x on wBTC. Most leveraged tokens incur no funding costs. With its unique value proposition—leverage without liquidation or funding costs—and a scalable decentralized stablecoin, v1 serves as a robust solution. However, the unpredictability of variable leverage may not suit everyone's needs. This is where v2 steps in, introducing a groundbreaking feature: Fixed Leverage of up to 10x, fully on-chain, with minimal liquidation risk and funding costs.

v2 also offers an exclusive feature through its stability pool, which delivers exceptionally high and sustainable yields derived from PERP trading commissions. These yields are achieved without exposing stakers to market volatility. The pool is USD delta-neutral and avoids counterparty risk, unlike other perpetual exchange protocols.

v1 still remains an excellent option, offering a unique use case by splitting any yield-bearing asset into two tokens: a stablecoin and a leveraged xToken. The stablecoins can harness enhanced yield without market exposure, while xTokens enjoy enhanced market exposure without yield.


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