Enosys has introduced Enosys Loans, a decentralized lending solution on the Flare Network, debuting the first stablecoin collateralized by XRP through a forked version of
Liquity
V2. This platform allows
XRP
holders to generate a fully collateralized, trustless stablecoin without liquidating their tokens, taking advantage of Flare’s decentralized and interoperable framework. Initially, the stablecoin is pegged 1:1 to the U.S. dollar and is supported by Flare XRP (FXRP) and wrapped Flare (wFLR), with future plans to incorporate staked XRP (stXRP) and additional Flare-based assets. Users interact with the system through Collateralized Debt Positions (CDPs), locking collateral to mint stablecoins. Stability is maintained through a combination of dynamic interest rates and a stability pool, which ensures the peg remains intact.
The protocol utilizes Flare’s Time Series
Oracle
(FTSO), a decentralized price feed that gathers information from multiple independent sources, promoting transparency and lowering the risk of manipulation. By replacing centralized oracles, this system supports Flare’s commitment to a trustless financial environment. Borrowers can set their own annual percentage rates (APRs), managing their risk and potential returns. If the stablecoin’s price drops below $1, loans with lower APRs are liquidated first to protect the system. Those participating in the stability pool receive rewards from mint fees, interest payments, and liquidation bonuses, motivating users to provide liquidity.
The launch of Enosys Loans is a major step forward for XRP’s functionality, allowing holders to use it as collateral for decentralized finance (DeFi) activities rather than just as a reserve asset. This enables XRP users to unlock liquidity, earn passive income, and engage in DeFi without having to sell their holdings. Supporting over 7 million active accounts on the XRP Ledger, the Flare Network serves as a vital connection between conventional and decentralized financial systems. By incorporating liquid staking derivatives such as stXRP, the protocol further expands XRP’s use cases, enabling it to be employed for both staking and borrowing purposes.
This launch leverages the established framework of Liquity V2, which has protected billions in collateral on
Ethereum
. Enosys has tailored this model for Flare, introducing customizable borrowing rates and incentives driven by the protocol to encourage liquidity. This combination brings together Ethereum’s robust risk controls with Flare’s flexible infrastructure, delivering a scalable approach for XRP-centered DeFi. Early participants are rewarded with rFLR tokens, which are given to users who mint stablecoins, contribute to the stability pool, or provide liquidity on decentralized exchanges.
Looking forward, Enosys intends to broaden acceptable collateral to include Flare’s native token (FLR) and other FAssets, enhancing the protocol’s capabilities. The platform aims to integrate with the wider Flare DeFi ecosystem, supporting functionalities such as stablecoin swapping, leveraged trading, and connections to real-world assets. As XRP’s presence in decentralized finance grows, Enosys Loans could become a central building block for a thriving XRP-based DeFi ecosystem, much like MakerDAO’s foundational place within Ethereum’s DeFi space.
