XRP has liquidity problems that are unrelated to price: more than 2 billion tokens (about 3.5% of the circulating supply) are not actually in circulation.
The tokens, worth approximately $3 billion, are held in Xaman’s wallet and have been largely excluded from decentralized finance (DeFi). Accessing DeFi means downloading new wallets, bridging assets across chains, managing gas tokens, and using unfamiliar interfaces. Most owners never bother.
Now, Xaman says it has reached an agreement with Flare Blockchain that will streamline the process into a single transaction, allowing users to deposit their XRP directly into designated vaults on the Flare Blockchain.
The system relies on three components that work in the background.
The first is FAsset, which creates a trust-minimized representation of XRP on Flare—effectively a wrapped version of the token that can interact with smart contracts. Then there’s the Flare Smart Account, which eliminates the need for users to manage a second wallet. Instead of handling private keys across chains, users can use existing XRPL credentials to authorize transactions. Finally, Xaman acts as a front-end, embedding the process directly into the wallets that many XRP holders already use.
From the user’s perspective, the process is reduced to a single operation. Behind the scenes, transactions come with detailed instructions. Flare’s data connector validates the request, while the Smart Account Controller handles the minting of packaged assets, allocation of vault strategies, and any subsequent distribution of earnings. Operations that typically require bridging assets, acquiring Gas tokens, and interacting with multiple decentralized applications are compressed into a single workflow.
“This integration allows our users to explore new options directly from the wallet they are already familiar with, while maintaining full control over keys and decisions,” Xaman founder Wietse Wind said in a statement to CoinDesk.
The treasury strategy itself is managed by Upshift and curated by Clearstar, which oversees capital deployment and risk management. While specific yield targets were not disclosed, the strategies are built around familiar DeFi primitives such as lending markets, collateralized positions, and structured products.
There are early signs that XRP holders are willing to try it out. The minted supply of Flare’s FXRP, its existing wrapped XRP token, has exceeded 100 million, with over 60 million currently deployed in staking programs and structured products. This growth at least shows there is an interest in putting XRP to work rather than letting it sit idle.
The wider context makes the timing noteworthy. XRP gained 6% earlier this week as retail buying surged 212%, and exchange-traded fund inflows have remained positive since its launch in November. However, much of the activity reflects directional bets on price.
The bigger challenge for XRP’s DeFi ambitions (sometimes referred to as “XRPFi”) is availability, not demand. If a multi-billion dollar coin is actually stuck due to friction, reducing friction may be more important than another rally. The infrastructure to transform passively held assets into productive capital may determine whether XRP’s DeFi narrative transcends the brand.