Hugo Philion , co-founder and CEO of Flare , wants to create a system that allows institutions to trade and lend using XRP-backed assets without exposing their activity to the public. The new system, called Confidential Compute, will launch in Q3 2026. Philion spoke in an interview with crypto YouTuber Crypto Sensei on YouTube , saying Flare is the missing link that the XRPL needed for smart contracts, yield generation, and private computation. What is FXRP and why is it a big deal? FXRP is simply a copy of XRP that lives on the Flare blockchain instead of the XRP Ledger. FXRP is worth as much as XRP, but because it lives on Flare, it supports smart contracts, and institutions can use it in lending markets, trading pools, and yield strategies. XRP on its own cannot access these features. Once users finish trading FXRP, they can swap it back to the original XRP at any time. Flare spent years testing the system on its Songbird canary network and launched FAssets on the mainnet in September 2025. What did FAssets v1.3 change? Before the v1.3 upgrade, users had to go through several steps just to convert XRP into FXRP. The process was confusing for non-technical crypto users, and the friction involved made it less appealing to banks. With the v1.3 upgrade, users can now send XRP in a single step, as the system handles the rest and issues FXRP to them without additional approvals. Philion said that any exchange worldwide that already supports XRP destination tags can automatically support FXRP minting, since the new design uses the native XRP Ledger . According to the Flare Network official documentation , “XRPL is where XRP is issued and moved. Flare is where XRP becomes programmable.” Philion also said that Flare limits how much FXRP the system can mint at a time (minting cap) to prevent cyberattacks. The system will also automatically liquidate all FXRP if agents who provide liquidity fail to post collateral that exceeds the FXRP they issue. And when the protocol faces a severe attack or critical failure, Flare’s Core Vault can route funds to a regulated custodian connected to Ripple. What lending markets is Flare building for XRP? Flare is working with Firelight and Morpho protocols to fill the lending gap in XRPL. Firelight adds liquid staking for XRP on the Flare network, allowing users to keep earning from their shared pool contributions while also using the derivative token in other DeFi strategies. Morpho, on the other hand, lets big institutions set up a market where only verified counterparties can borrow, at rates they define, with collateral they approve. It is almost similar to how institutional lending works in traditional finance, and it is a way to pitch to the same banks and treasury desks that already use XRP for cross-border payments. Flare is also working with the crypto platform Uphold to build one-click products that put these capabilities in the hands of everyday users. What is Confidential Compute, and why would institutions care? Flare 2.0, or Flare Confidential Compute, is a system the company wants to create to provide blockchain privacy for large financial institutions. Because blockchain activity is fully public, banks, hedge funds, or asset managers face front-running risks whenever they post a massive trade on a public blockchain. But Confidential Compute creates sealed private rooms for computation using Trusted Execution Environment (TEE). With this system, a computer’s processor can run code in complete isolation, even without the knowledge of the computer’s operator. Institutions will be able to trade real-world assets issued on the XRPL, borrow against them, or run a compliant decentralized exchange without publicizing any of the activity. Who is already using Flare’s infrastructure for real money? Nasdaq-listed VivoPower (VVPR) deployed $100 million in XRP via Flare’s FAssets infrastructure in June 2025. VivoPower converted its corporate treasury into XRP, so it earns yield on FLare. Kevin Chin, VivoPower’s CEO, said the company wants to build “a virtuous cycle” in which it earns yield, uses it to buy more XRP, and repeats the process. The company’s backing came from a notable group of shareholders, including a member of the Saudi royal family. Flare also teamed up with hardware wallet maker D’CENT to launch the XRP alliance that connects D’CENT’s 720,000 hardware wallet users directly to XRP yield vaults on Flare. Users can now deposit XRP using only two digital signatures through Flare Smart Accounts, mint FXRP, and start earning. They do so while keeping their coins in self-custody. The campaign attracted over 5,400 users, and the initial earnXRP vault reached its 25 million XRP cap in just one week. The smartest crypto minds already read our newsletter. Want in? Join them .
