XRP Holders Can Now Borrow RLUSD Stablecoin on Ethereum

XRP holders can now borrow Ripple's RLUSD stablecoin on Ethereum via a new isolated market on Morpho Blue. The lending pool, managed by Sentora, has approved wrapped XRP (FXRP) as collateral for borrowing RLUSD.

The approval was granted after reviewing FXRP's market behavior, oracle design, liquidity and liquidation capacity under an institutional risk framework. This move opens up new possibilities for XRP holders to use their coins in decentralized finance without selling them.

Flare, the blockchain that allows XRP to be used in DeFi, is working on tools to streamline the process of minting and bridging FXRP. Currently, users must follow a multi-step process involving minting FXRP through Flare's FAssets system, bridging it to Ethereum via Stargate, depositing it into the market, and borrowing at their chosen loan-to-value ratio.

The isolated structure of Morpho Blue allows for individual markets with their own collateral assets, debt assets, oracles, and liquidation thresholds. This prevents a failure in one market from affecting other areas of the vault.