XRP holders can now borrow RLUSD on Ethereum through $280 million lending pool
Reported by CoinDesk · AI-assisted summary by ChikoCorp AI News Desk
AI-generated summary based on the linked source; not independently verified. This is not investment advice. Verify market-moving details at the original publisher before acting. See our editorial policy, AI content policy, and financial disclaimer.
Summary
XRP holders can now borrow the RLUSD stablecoin on Ethereum by using wrapped XRP (FXRP) as collateral through an isolated market on Morpho Blue. This lending pool, managed by Sentora, has approved FXRP as collateral after assessing its market behavior and risk factors. Flare is also developing tools to simplify the currently complex process of minting and bridging FXRP, aiming for a streamlined borrowing flow directly from an XRP Ledger wallet.
Why it matters
The development enables XRP holders to access loans on Ethereum without selling their XRP, expanding the utility of XRP within decentralized finance. The approval of FXRP by an institutional risk team on Ethereum's mainnet is considered significant by Flare's CEO, highlighting a level of trust and integration important for broader DeFi adoption.
Key context
Flare blockchain facilitates the use of XRP in decentralized finance by issuing wrapped XRP tokens called FXRP. Borrowers currently must mint FXRP, bridge it to Ethereum, deposit it, and then borrow RLUSD, but Flare is working on simplifying this multi-step process. Morpho Blue sets isolated markets for each collateral and debt asset, containing risk within each market. Approximately 155 million FXRP have been minted so far, against a six-month target of 5 billion XRP.
Key numbers and entities
The lending pool managed by Sentora holds $280 million in Ripple's RLUSD stablecoin. Around 155 million FXRP tokens have been minted since launch. Flare is the blockchain issuing FXRP, with CEO Hugo Philion providing key statements. Morpho Blue hosts the isolated FXRP/RLUSD market.
What remains unclear
The source does not provide specific details on the supply cap for the new market, the loan-to-value ratio, liquidation thresholds, or the oracle source currently used by Sentora. CoinDesk has reached out for this information but has not yet received a response.