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XRP is not the place where investors go to provide loans or staking.
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Its competitors are the preferred platform for these activities and many more.
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The play progresses into a different, even more important area.
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10 stocks we prefer over XRP ›
XRP (CRYPTO:XRP) is far from competitors like Solana (CRYPTO: SOL) and Ethereum (CRYPTO: ETH) in decentralized finance (DeFi). The recent launch of its new Ethereum Virtual Machine (EVM) sidechain hasn’t made much difference either. He seems to have almost no chance of catching up.
Is this a reason to sell this piece? Actually, the situation is a little more complicated, so let’s take a closer look.
Today, the total value locked (TVL) of the XRP Ledger (XRPL) in its DeFi ecosystem stands at just over $82 million. Its new EVM sidechain only has $48,989 in TVL. For context, Ethereum has almost $83 billion in TVL and Solana has almost $11 billion. So even though XRP’s market cap is larger than Solana’s and is about 33% of Ethereum’s, its DeFi segment is microscopic in comparison.
But let’s take a step back and look at what XRPL was actually designed for before declaring its lack of DeFi value to be a deciding factor that justifies selling the coin.
XRP’s initial focus was on making international payments and money transfers, with native features for rapid transaction settlement, currency bridging, and regulation-compliant capital flows rather than a sprawling smart contract DeFi ecosystem. XRP itself is the bridging asset that the network uses to efficiently transfer value between currencies and locations, and it is used for this purpose today.
And that was just the beginning of what Ripple, the issuer of XRP, did with the coin. It is being integrated into a comprehensive fintech stack for institutional investors, which now includes RLUSD (CRYPTO: RLUSD)Ripple’s native stablecoin backed by fiat currency.
RLUSD is a key piece of the puzzle, as payments, settlements, and on/off ramps are where XRPL competes; Stable, regulated rails of value are essential for banks and fintechs who do not want to assemble a DIY regulatory compliance stack from DeFi coins like they would have to do on Ethereum or Solana. Right now, RLUSD has a market cap of $898 million, so it’s already large enough for financial institutions to use as a meaningful part of their on-chain fiat value.
In other words, a low DeFi TVL tells you that XRPL is not a hotbed of yield farming, bespoke lending services, or staking activities. Anyway, it’s not about being a platform for these things. The most important factor is its toolbox of institutionally targeted features, which is large and growing.
