Flare has launched a new product called earnXRP, allowing holders of XRP to earn yield without selling or engaging in complex decentralized finance (DeFi) strategies. This fully on-chain yield product is designed to let users deposit FXRP, which mirrors XRP on the Flare network, and benefit from compounded returns in XRP.
The vault employs a variety of strategies, such as staking XRP, providing liquidity, and conducting carry trades with low-cost stablecoins to generate higher yields. This approach is significant, as a small percentage of XRP's total supply is currently utilized in DeFi, despite its market size and liquidity.
By denominating returns in XRP, earnXRP aims to attract those who prefer to avoid exposure to stablecoins or the risks associated with active trading. This initiative is expected to enhance Flare's liquidity by transforming idle XRP into productive capital, thereby increasing on-chain activity and fortifying the Flare ecosystem.