Flare Just Turned XRP Into Collateral as Holders Can Now Borrow RLUSD Without Selling their XRP.

For years one of the biggest problems with XRP has been very simple: millions of holders own it, but there have not been many ways to use it without selling it.

That is slowly starting to change through Flare and their FXRP..

Sentora has now added FXRP as an accepted form of collateral inside its RLUSD main vault on Morpho. In simple terms, XRP holders can use FXRP t

o borrow RLUSD without having to sell their XRP at all.

A new FXRP and RLUSD lending market has launched on Morpho, a lending platform built on Ethereum.

In this market, users can deposit FXRP as collateral and borrow RLUSD against it.

Think about it like using a house as security for a loan. You do not sell the house, but you use its value to borrow money.

The same basic idea applies right here.

You provide FXRP as security, receive RLUSD, and later repay the RLUSD loan plus interest to withdraw your locked FXRP.

FXRP is the first form of XRP to be accepted as collateral inside an institutionally managed lending vault on Ethereum. Sentora’s RLUSD main vault currently holds around $280 million in deposited RLUSD which is huge.

That is important because this is not simply a small test market with very little money available.

FXRP is gaining access to a much larger pool of stablecoin liquidity.

For the new people, RLUSD is Ripple’s dollar-backed stablecoin.

The value is designed to remain close to one US dollar, which means it can be used for payments, trading, lending and other financial activities without the same price movements we normally see with XRP as an example.

Through this new market, an XRP holder can use FXRP as collateral and borrow RLUSD.

The holder could then use that RLUSD elsewhere while keeping exposure to the price of XRP through the FXRP that was deposited.

But this is still a loan. It is not free money, and the RLUSD must eventually be repaid with interest.