$XRP Ledger validator Vet has argued that $XRP is set to lead the next phase of decentralized finance (DeFi).
In a post on X, Vet stated that traditional DeFi still has “a long way to go” before replacing traditional finance. Meanwhile, he believes $XRP is built to drive a more sustainable transition.
According to him, the $XRP protocol’s design is better suited for high-value financial use cases, particularly those aiming to replicate or replace core TradFi systems.
He pointed to deliberate design choices within the $XRP Ledger that prioritize stability over aggressive yield opportunities. In his view, these trade-offs make the network more robust for financial applications, even if they limit some of the upside seen in other ecosystems.
Key Points
- XRPL validator Vet says $XRP is positioned to lead the next phase of DeFi.
- He argues XRPL’s design favors stability and real-world financial use cases over high-risk yields.
- Flare founder Hugo Philion pushed back, saying no protocol can claim superiority without scale.
- Critics highlight XRPL’s low DeFi activity and absence among top DEX volume networks.
- $XRP’s DeFi ecosystem is growing, with FXRP supply nearing 160M and rising protocol usage.
Flare Founder Pushes Back on “Superiority” Claims
The comments drew a response from Hugo Philion, founder of Flare Network, who said the claims of superiority were premature.
While acknowledging his support for $XRP and XRPL, Philion criticized the tone of the argument. He noted that multiple protocols across the crypto industry, including those connected to XRPL, have faced bugs and rollout challenges.
He argued that no protocol can claim superiority without being tested at meaningful scale. In his view, DeFi as a whole is still evolving, and $XRP’s entry into the space should be seen as part of industry growth rather than a definitive leap ahead.
XRPL’s Design Philosophy: Less Risk, Fewer Features
In response, Vet clarified that his argument centers on risk management rather than competition. He explained that XRPL intentionally avoids features like complex smart contract composability and staking, which are common in other ecosystems but can introduce layered risks.
According to him, this lack of “multiplicative risk” is a strength, not a weakness. By reducing exposure to cascading failures often seen in DeFi protocols, XRPL may offer a more stable foundation for institutional-grade financial applications.
You’re missing the point entirely.
The $XRP protocol deliberately sacrifices some upside people are using elsewhere in return of not having the downside we are seeing as well.
We have no multiplicative risk composability via smart contracts and no staking. That’s not grave…
— Vet (@Vet_X0) April 20, 2026
Critics Point to Lack of DeFi Volume
Meanwhile, X user Tony Xu questioned XRPL’s relevance in the current DeFi landscape, pointing to its relatively low trading activity compared to leading chains.
Citing data from CoinGecko, he highlighted that XRPL does not appear among the top networks by decentralized exchange (DEX) trading volume.
The report showed Solana maintaining the top spot despite a 26.5% drop, while BNB Chain ranked second with a 24.5% market share. Ethereum also remained a major player, briefly overtaking Solana in March.
Other chains such as Arbitrum, Tron, Avalanche, Sui, and Monad also featured among the top 10.
$XRP DeFi Push Nears 160M FXRP Milestone
Meanwhile, $XRP’s DeFi ecosystem is only beginning to develop, with staking features enabled via Flare Network.
Its FXRP supply is approaching 160 million, months after launch, amid rapid adoption.
A larger portion of the supply is locked in DeFi protocols like Firelight, Kinetic, BlazeSwap, and Upshift, highlighting growing usage for yield and liquidity. The initiative gives $XRP holders new passive income options.
In sum, DeFi continues to mature, and $XRP is positioning itself to compete, despite arriving later than many of its peers.
