XRP just got its first modular lending markets. Flare has integrated Morpho, a lending protocol with over $10 billion in TVL across EVM chains, bringing institutional-grade borrowing and lending infrastructure to FXRP holders through Mystic Finance.
The setup lets XRP holders keep their assets on the XRP Ledger while FXRP, the XRP-linked asset on Flare, unlocks full DeFi utility. Deposit into yield-bearing vaults, borrow stablecoins against your holdings without selling, or loop capital across staking, lending, and borrowing for more advanced plays.
🆕 First modular lending for XRP is here.@Morpho × @mystic_finance are now live — bringing permissionless, actively managed, institutional-grade vaults to the XRPFi ecosystem.
— Flare ☀️ (@FlareNetworks) February 3, 2026
🦋✨FXRP holders can now:
• Earn yield
• Borrow stables without selling
• Build and loop… pic.twitter.com/VBbJE8YJL8
How It Works
Morpho’s modular design breaks from traditional pool-based lending in a critical way: it isolates risk at the individual market level. Each market supports a single collateral asset paired with a single loan asset, with parameters like loan-to-value ratios locked in at creation. Problems in one market stay contained rather than cascading across the entire protocol.
The process breaks down simply:
• Deposit FXRP, FLR, or USDT0 into curated vaults
• Vaults allocate capital across selected lending markets
• Borrow stablecoins against your collateral
• Earn yield on deposited assets
• Loop positions across staking and lending for advanced strategies
Markets can be launched permissionlessly, but curated vaults keep things manageable. Independent curators design and manage these vaults, spreading deposits based on specific risk and yield objectives. Clearstar is offering options at launch backed by FXRP, FLR, and USDT0.
Mystic Finance serves as the front-end interface, giving users a clean entry point to Morpho’s infrastructure on Flare. The combination creates a lending layer that’s flexible for builders and accessible for everyday users.
Why It Matters
XRP holders have historically been locked out of serious DeFi participation. The asset sits, it waits, and it does very little in between. This changes that equation entirely.
FXRP can now earn yield through vault deposits, serve as collateral for borrowing stablecoins, and integrate into structured strategies that combine multiple DeFi primitives. Want to stake through Firelight, borrow against your position, and redeploy that capital? The infrastructure now exists to do exactly that.
The modular architecture also means XRP exposure doesn’t come bundled with risks from unrelated assets. Your FXRP collateral lives in its own market with its own parameters, not mixed into a general pool where someone else’s bad bet becomes your problem.
The Bigger Picture
This launch slots into Flare’s broader XRPFi ecosystem, which has been building out infrastructure piece by piece. FXRP handles representation, Firelight covers staking, Hyperliquid enables spot trading, and Spectra brings yield tokenization. Modular lending through Morpho and Mystic was the missing layer.
The vision is straightforward: transform XRP from a dormant asset into a productive source of yield, credit, and composable strategy. An asset class with a market cap in the tens of billions shouldn’t sit idle while the rest of crypto builds increasingly sophisticated financial tools.
Flare is betting that XRP holders want more than price appreciation. They want utility, yield, and the ability to put their capital to work without giving up their core position. With Morpho’s proven infrastructure now live, that bet gets its first real test.
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