Original Author: Weilin, PANews
On June 10, the XRP Ledger Apex 2025 Conference was held in Singapore. At the conference, a concept called "XRPFi" became a hot topic on social media. XRPFi, which is the combination of XRP and decentralized finance (DeFi), is increasingly seen by practitioners as a new path to activate XRP, an established crypto asset, and drive the growth of XRPL and Ripple ecosystem.
XRP is one of the most representative assets in the crypto market, with a current market cap close to $134.4 billion, making it the highest-valued non-smart contract cryptocurrency after Bitcoin. With its fast and low-cost cross-border payment capabilities, XRP has stable applications in traditional financial scenarios. However, in the on-chain domain, XRP has long lacked smart contract support, making it difficult to integrate into mainstream DeFi ecosystems, a structural contradiction that has gradually become a focus of attention.
With the SEC's suspension of the lawsuit against Ripple, the market cap of Ripple's stablecoin RLUSD approaching $390 million, and ongoing market speculation about an XRP ETF, investors' expectations for XRP's future are gradually warming up. Some institutions and retail investors have begun to focus on how XRP can generate revenue and improve asset utilization through DeFi, which has also driven the birth and development of the "XRPFi" concept.
Empowering XRPFi with Flare, Building a Multi-Chain Interoperable DeFi Ecosystem
In the current XRPFi development process, Flare Network is seen as a key infrastructure provider. While XRP Ledger (XRPL) performs excellently in speed and stability, it has natural limitations in composability and contract functionality required by DeFi. Therefore, Flare has chosen to technically empower XRP, becoming the core engine bridging the traditional XRPL with multi-chain DeFi ecosystems.
Flare is an EVM-compatible L1 blockchain designed to achieve multi-chain interoperability. Its FAssets protocol can map non-smart contract assets like XRP to FXRP, giving them contract call capabilities and seamlessly accessing decentralized lending, trading, and derivatives protocols. Through this mechanism, XRP holders can participate in mainstream on-chain yield activities, including staking and liquidity mining.
Additionally, Flare has introduced USD₮ 0 stablecoin, issued as a native asset based on the LayerZero OFT (Omnichain Fungible Token) standard, with native cross-chain interoperability. Paired with XRP, USD₮ 0 can not only be used to build trading depth pools and lending collateral but also connect to the USDT ecosystem with a market cap of over $155 billion, injecting a high-liquidity "capital base" into the XRPFi ecosystem.
According to official data, the Flare ecosystem has grown significantly recently: as of June 10, its TVL broke through $157 million, mainly due to the launch of USD₮ 0, with a current supply of around $92.1 million. Looking at a longer timeframe, Flare's TVL grew by over 400% year-on-year from February 2024 to February 2025. Simultaneously, Flare has integrated wallets compatible with XRPL such as Bifrost and Oxenflow, further lowering user entry barriers.
Flare describes its XRPFi system as a "flywheel model": using USD₮ 0 to provide capital sources, FXRP to achieve contract composability, with the pair bringing liquidity, thereby driving more DeFi applications and real-world scenarios, which in turn feed back to XRP's long-term ecosystem value.
In the future, Flare plans to bring non-smart contract assets like Bitcoin and Dogecoin into Flare, expanding its use cases in the DeFi field.
Building XRPFi Yield Matrix, CeDeFi and On-Chain Strategies Running in Parallel
While Flare builds on-chain compatibility, Doppler Finance has designed a comprehensive yield mechanism around XRP, attempting to fill the gaps in XRP's past lack of interest-bearing and financial products. As of June 8, the platform has attracted over $30 million in TVL, becoming one of the key participants in the XRPFi track.
Doppler Finance offers two main types of yield products: CeDeFi yields and on-chain DeFi strategies. The former primarily manages assets through institutional-level custody and quantitative operations, while the latter explores on-chain yield scenarios including lending, stablecoin strategies, and staking.
In the CeDeFi mode, users deposit XRP into dedicated addresses, with assets managed by custodians like Fireblocks and Ceffu, and transferred to centralized exchanges according to plan to conduct quantitative strategies such as arbitrage and basis trading. Yields are settled off-chain and flow back to user accounts.
In terms of on-chain yields, Doppler is actively connecting with XRPL sidechain ecosystems, including EVM-compatible networks and emerging protocols. Its strategies include:
XRP Lending: Depositing XRP into audit-compliant lending protocols to earn interest or native rewards. Borrowers provide other assets as collateral, with the platform automatically managing liquidation processes to ensure safety.
Stablecoin Yield Strategies: Borrowing stablecoins (like USDC) using XRP as collateral, then deploying them into stablecoin yield protocols. Doppler uses conservative LTV ratios and dynamically adjusts positions to achieve low-risk yields.
Liquidity Staking and Leverage Strategies: Users can perform one-click leveraged staking in specific LST pools, especially around sidechain tokens like ROOT. This mechanism simplifies complex operations through automated contracts, improving user experience.
To further reduce risks, Doppler Finance is constructing a risk-isolated lending market that allows different asset pools to operate independently, avoiding high-volatility assets dragging down the overall system stability. Besides core pools containing mainstream assets like XRP, USDC, and ROOT, Doppler Finance plans to launch multiple isolated markets, including LST pools designed for leveraged yield farming and markets containing game tokens from the Futureverse ecosystem.
Since XRPFi involves asset cross-chain, custody, and high-level strategy execution, its security mechanism becomes an important part of project design. Currently, Doppler Finance adopts multi-layered risk control mechanisms.
In asset custody, the platform selects top-tier service providers (like Fireblocks and Ceffu) and ensures asset safety through cold wallet management, on-chain verification, and bankruptcy isolation. For quantitative trading, the platform adopts a multi-strategy, multi-team collaboration model and designs most operations as "lending contract structures" to ensure principal can be recovered under non-extreme conditions.
Additionally, according to official introduction, all cooperating trading teams must pass rigorous due diligence, including assessments of historical performance, strategy stability, AUM scale, and financial risks, to screen qualified institutions for participation.
Filling the DeFi Market Blank, XRPFi Still in Early Stages
As Ethereum's DeFi ecosystem becomes increasingly competitive, the market is turning its attention to high-market-cap assets that have not been fully activated. The emergence of XRPFi fills the long-standing gap of XRP being "high market cap, low chain usage". XRPFi, achieved through technologies like Flare Network's FAssets protocol, allows XRP, originally lacking smart contract capabilities, to enter the DeFi ecosystem. Doppler Finance is building a comprehensive and sustainable yield mechanism including CeDeFi yields and liquidity staking, not only with a realistic pathway but also investing resources to enhance safety and user experience.
Logically, the development of XRPFi responds to the urgent need to activate XRP and Ripple ecosystem development. However, it needs to be pointed out that the current XRPFi ecosystem is still in its early stages. While the product routes of Flare and Doppler are relatively clear, the overall user scale, liquidity depth, and protocol maturity are yet to be verified. How will the integration of old assets into a new narrative unfold? PANews will continue to follow closely.
