XRP has a liquidity problem that has nothing to do with price: More than 2 billion tokens, or about 3.5% of the circulating supply, are not actually circulating.
Around $3 billion worth of tokens are held in Xaman wallets and are largely locked out of decentralized finance (DeFi). Accessing DeFi means downloading new wallets, bridging assets across chains, managing gas tokens, and navigating unfamiliar interfaces. Most owners never bothered.
Now, Xaman said it has entered into an agreement with the Flare blockchain that will reduce the process to a single transaction, allowing users to deposit their XRP directly into a curated box on the Flare blockchain.
The system rests on three components that work in the background.
First is FAssets, which create a trust-minimized representation of XRP on Flare – essentially a wrapped version of the token that can interact with smart contracts. Then comes Flare Smart Accounts, which removes the need for users to manage another wallet. Instead of juggling private keys across chains, users authorize transactions with their existing XRPL credentials. Finally, Xaman acts as the front-end, embedding the process directly into the wallet that many XRP holders already use.
From the user’s perspective, the process is reduced to a single action. Behind the scenes, the transaction carries detailed instructions. Flare’s Data Connector validates the request, while Smart Account controllers handle the minting of the wrapped asset, allocation to vault strategies and any subsequent dividend distribution. What would typically require bridging assets, acquiring gas tokens, and interacting with multiple decentralized applications is compressed into one workflow.
“This integration lets our users explore new opportunities directly from the wallet they already know, while maintaining full control over their keys and decisions,” Wietse Wind, founder of Xaman, said in a statement to CoinDesk.
The vault strategies themselves are managed by Upshift and curated by Clearstar, which oversees capital deployment and risk management. Although specific return 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 experiment. Flare’s FXRP – its existing wrapped XRP token – has surpassed 100 million in minted supply, with more than 60 million currently deployed across stake programs and structured products. This growth at least suggests some appetite to get XRP going instead of letting it sit idle.
The wider background makes the timing remarkable. XRP rose 6% earlier this week amid a 212% increase in retail buying volume, and exchange-traded fund inflows have been positive since their launch in November. Still, much of this activity reflects directional bets on price.
For XRP’s DeFi ambitions — sometimes called “XRPFi” — the biggest challenge has been ease of use, not demand. If billions of dollars worth of tokens are effectively stranded by friction, lowering that friction could mean more than another rally. Infrastructure that turns passive holdings into productive capital could determine whether XRP’s DeFi narrative evolves beyond branding.
