- Flare has integrated a DeFi functionality for XRP with the FXRP.
- FXRP is a wrapped token with a 1:1 representation of XRP.
- The token allows the participation of XRP holders in DeFi applications, including borrowing, lending, earning interest, gaining yields, and providing liquidity for DEXs.
XRP is one of the top cryptocurrencies in market cap, with its overall value now exceeding $168 billion. However, most of its value flows outside decentralized finance (DeFi), as the digital asset is primarily tailored for quick and cost-efficient cross-border payments.
With that, the token powering the XRP Ledger (XRPL) notably lacks a native Ethereum Virtual Machine (EVM) functionality to support complex Turing-complete smart contracts. This prevents the asset from easily integrating into lending markets, liquidity pools, and staking protocols.
To address such a limitation, Flare (FLR) has introduced FXRP.
FXRP: Bringing XRP on Flare
FXRP operates on Flares FAssets ecosystem. The platform is an over-collateralized bridge to link non-smart contract networks, such as Bitcoin (BTC), XRP, and Dogecoin (DOGE), to the Flare network. Its trustless nature means it does not rely on a centralized intermediary.
FAssets enables the creation of wrapped tokens based on the mentioned assets to pave the way for their seamless participation in Flare’s DeFi. Likewise, it allows holders to convert the wrapped tokens back to their original assets.
FXRP is a 1:1 representation of XRP on the Flare EVM-compatible Layer 1 (L1) blockchain. Holders can utilize the token to participate in DeFi applications like lending and borrowing, earning from interest and yield, and providing liquidity pool for decentralized exchanges (DEX). These activities reward users with revenues from fees, interest payments, incentive tokens, and other rewards.
Flare revealed that it will unlock liquid staking via Firelight to expand the utility of the FXRP soon.
XRP and FLR Performance
Despite their latest milestone, the values of XRP and FLR remained subdued by various factors in the crypto market. A key event holding them back is the ongoing market-wide liquidations.
In the last 24 hours heading to Thursday noon (UTC), XRP peaked at a $2.99 intraday high before pulling back to $2.81. Meanwhile, FLR temporarily touched a $0.02847 daily high before retracing to $0.02466.
Final Thoughts
Flare’s FXRP presents a new use case for XRP beyond being a fast, secure, and efficient institutional cross-border payment rail. It also positions the asset as a foundational element in DeFi.
Overall, Flare aims to turn XRP from a primarily transactional asset into a more versatile, programmable one, which can lead to increased adoption, liquidity, and a stronger position in the crypto market.
What’s your Reaction?
+1
0
+1
0
+1
0
+1
0
+1
0
+1
0
+1
0
