Uphold’s FXRP Staking Model Could Reshape XRP Rewards – If Regulators Allow It

Uphold is exploring a bold new way to bring staking to XRP and it could change the game for holders of the token. The plan: Use the Flare network’s DeFi capabilities to make XRP staking possible, even though XRP doesn’t support staking on its own.

With over 10 million users in 140+ countries, Uphold CEO Simon McLoughlin says the platform is getting ready to test a system that could let users earn yield from XRP through a clever workaround. But in the U.S., regulatory challenges could slow things down.

XRP Doesn’t Support Staking, So Uphold Is Getting Creative

XRP doesn’t use a proof-of-stake system, which is normally how crypto staking works. That makes it tricky to offer staking in the usual way. But Uphold may have found a solution – by working with Flare, a fast-growing DeFi network.

Here’s how it would work: when a user chooses to stake XRP, Uphold locks that amount in its own reserve. Then, it creates an equivalent wrapped version of XRP, called FXRP, on the Flare network. That FXRP can be used on Flare to generate returns, thanks to the network’s deep liquidity pools.

“There’s a depth of liquidity in those pools that makes it viable for us, for the first time, to look at offering a beta test,” McLoughlin said. A small group of users may get access to the test soon.