Flare Network Launches XRP Spot Market on Hyperliquid

TLDR

• Flare introduces FXRP/USDC trading for XRP holders.
• Hyperliquid's upgrade reduced fees by 90% for trading.
• Flare aims to address a $116 billion XRP staking gap.

Flare Network has introduced its first XRP spot market on Hyperliquid, allowing onchain trading of XRP. The launch uses the FXRP/USDC trading pair and incorporates Flare's FAssets system along with LayerZero's OFT standard. This new development aims to expand liquidity across various chains while enabling redemption back to the XRP Ledger (XRPL).

This move is significant for XRP holders who can now mint FXRP on Flare and engage in decentralised finance (DeFi) activities via FXRP. Flare Network's Layer 1 blockchain provides the infrastructure for FXRP, a wrapped 1:1 XRP token compatible with Ethereum Virtual Machine (EVM) ecosystems. Hyperliquid, a decentralized exchange, hosts this FXRP/USDC spot trading on its orderbook.

Ecosystem and Integration Efforts

Key figures in this initiative include Hugo Philion, Co-founder of Flare Network, and Dhruv Shah, a DeFi Analyst at Flare. Shah has emphasized FXRP's capacity to introduce a new asset class into Hyperliquid's ecosystem while maintaining complete onchain functionality. Philion described this integration as an expansion of XRP's utilities across DeFi, while conserving the XRPL as the main settlement layer.

With significant backing from institutional capital, Flare has attracted $100 million through VivoPower for FAssets/XRP. The platform anticipates addressing a $116 billion XRP staking gap through initiatives such as earnXRP yields and Firelight liquid staking. No new funding has been tied directly to this specific launch.

Improved Trading and Liquidity Solutions

Flare's launch on Hyperliquid aims to enhance liquidity and trading options beyond the traditional XRPL. Hyperliquid recently underwent the HIP-3 upgrade, which reduced fees by 90%, and boasts a total value locked (TVL) of $2.15 billion with a 24-hour trading volume of $32 billion. FXRP adds spot trading liquidity with more competitive spreads compared to automated market makers (AMMs).

FXRP offers a seamless redemption process back to XRPL, facilitated through Flare Smart Accounts. The Songbird testnet has significantly boosted Flare’s TVL, and Hex Trust holds $100 million of wrapped XRP (wXRP) at TVL. However, there are no specific reports on post-launch TVL or staking shifts and liquidity flows.

Broader Impact and Future Prospects

This initiative positions XRP as a competitive asset in the DeFi space, participating in various financial services beyond its original use. Similar past events, such as the FAssets launch, have maxed allocation and significantly boosted TVL. FLR spot trading, enabled by LayerZero partnerships, has expanded access to Flare tokens, appealing to institutional investors.

Flare Networks' focus remains on interoperability for non-smart contract assets like XRP, enabling minting of FXRP without losing custody. For more updates from Flare Networks, visit their official news page. The introduction of FXRP seeks to address the XRPFi staking gap and maximizes XRP's potentials as a DeFi collateral asset.