In June, Uphold, a popular crypto exchange with over 10 million users worldwide, announced that exploring ways that let users to stake XRP and earn rewards. In an interview, Uphold CEO Simon McLoughlin said that XRP staking appears both feasible and promising, it is challenging because “XRP isn’t a proof-of-stake network.” He added, “There’s not a staking mechanism you can rely on.”
To achieve this, Uphold is considering utilising the Flare Network, which is a DeFi platform that has wrapped token support. Flare supports its users creating a version of XRP known as FXRP, which can be utilized within its network.
If a user chooses to stake their XRP, Uphold would freeze the actual XRP in its reserve. It would then mint FXRP on the Flare network, which is a wrapped XRP, and it could be staked in order to receive rewards.
McLoughlin also revealed that a beta test for XRP staking is now possible thanks to the growing liquidity on Flare. He said it may be more complex in the U.S., but Uphold is confident about offering XRP staking in other regions first.
“We’ve just got to make sure that by wrapping XRP and putting it on a different network, there’s not an interpretation that says, well, actually, you Uphold are manufacturing a security that creates an expectation of profit,” McLoughlin said.
Also Read: Uphold Explores IPO, Targets XRP-Obsessed U.S. Crypto Market
