XRP as DeFi collateral: how Ripple’s RLUSD lending play through Flare and Morpho could reshape a $70 billion asset

Flare’s FXRP token has been approved as collateral in an institutionally curated Morpho vault on Ethereum, letting XRP holders borrow Ripple’s RLUSD stablecoin without selling. It is the first time an XRP-based asset has been accepted in a major on-chain lending market. Summary Flare’s FXRP, a bridged version of XRP on Ethereum, has been approved as collateral in Sentora’s RLUSD Main vault on Morpho, allowing XRP holders to borrow Ripple’s RLUSD stablecoin without selling their tokens. The integration is the first time an XRP-based asset has been accepted as collateral in an institutionally curated Ethereum lending market, a milestone for an asset that has been almost entirely absent from DeFi. XRP is the fourth largest cryptocurrency by market capitalization at approximately $70 billion, yet its utilization in on-chain lending, borrowing, and liquidity provision has been negligible compared to assets like ETH, WBTC, and stablecoins. Ripple has been building RLUSD as an enterprise-focused stablecoin since August 2024, securing NYDFS approval in December 2024 and a Mastercard settlement integration in July 2026. The Morpho Blue lending protocol uses isolated markets designed to cont...