Flare has announced that FXRP has been added as an approved collateral asset in Sentora’s RLUSD Main vault on Morpho, according to information shared with Finbold on August 3, 2026.
The move creates a new permissionless market where XRP holders can borrow RLUSD against FXRP on Ethereum (ETH) mainnet, marking the first time a representation of XRP has been approved as collateral in an institutionally curated lending vault on Ethereum.
Sentora’s RLUSD Main vault currently holds approximately $280 million in deposited RLUSD, making it the largest institutionally curated RLUSD vault on Ethereum.
Through the new isolated FXRP/RLUSD market on Morpho Blue, users can mint FXRP through Flare’s FAssets system, bridge it to Ethereum, supply it as collateral, and borrow RLUSD without selling their XRP exposure.
“XRP is one of the largest assets in crypto and one of the least used in DeFi. That gap came down to infrastructure,” said Hugo Philion, Co-founder and CEO of Flare.“FXRP closed part of it by making XRP programmable. This closes another part. XRP is now collateral that an institutional risk team underwrites on Ethereum mainnet, which is a stronger form of recognition than another bridge listing.”
Jesus Rodriguez, Co-founder and CTO-CPO of Sentora, added:
“XRP is one of the largest and most liquid digital assets in the market. By enabling FXRP as collateral in our RLUSD vaults, we are bringing that scale into DeFi and expanding the productive utility of XRP across onchain credit markets.”
Non-custodial access with simplified minting route in development
Access to the market is non-custodial and permissionless, with no whitelist required. Users retain exposure to XRP through FXRP while borrowing RLUSD at their chosen loan-to-value ratio.
The market launches with a conservative supply cap, which may increase as usage and liquidity grow. Interest rates adjust based on utilization, and borrowers must maintain positions below the liquidation threshold.
Before approving FXRP, Sentora evaluated the asset under its institutional risk framework, covering market behavior, oracle design, liquidity, and the ability to support liquidations and withdrawals. FXRP is now subject to the same ongoing monitoring as other collateral assets in the vault.
The market is built on Morpho Blue, a permissionless lending protocol on Ethereum that uses isolated markets, with each market carrying its own collateral asset, debt asset, oracle, and liquidation threshold to contain risks within individual markets.
At launch, users mint FXRP on Flare, bridge it to Ethereum through Stargate, deposit it into the FXRP/RLUSD market, and borrow RLUSD up to the permitted loan-to-value ratio.
Flare is also developing a simpler route through Flare Smart Accounts, which would allow XRP holders to authorize transactions from an XRP Ledger wallet while the underlying infrastructure handles FXRP minting, bridging, collateral deployment, and RLUSD borrowing. Direct FXRP minting from XRPL to Ethereum is also under development, which would remove the separate bridging step entirely.
The launch gives other Morpho curators a reference point for evaluating FXRP under their own risk parameters, and because Morpho markets are permissionless, wallets, exchanges, and other applications can integrate the market into their own interfaces.
Featured image via Shutterstock.
