Uphold Wants to Pay Yield on XRP – Here’s the Work-Around

Uphold is looking for a way to offer customers staking rewards on XRP, even though the token’s blockchain doesn’t support proof-of-stake.

Chief executive Simon McLoughlin told The Block that the company’s engineers have sketched out a detour: wrap XRP on the Flare Network and let users earn yield there instead.

How it works

• A customer chooses to “stake” XRP in the Uphold app.
• Uphold locks the same amount of native XRP in its own cold wallets.
• The platform then mints FXRP—a wrapped version of the coin—on Flare and deposits it into liquidity pools where yield is generated.

Because Flare’s DeFi pools now have enough depth, McLoughlin says a limited beta could launch “for the first time” in the coming months.

Regulatory fine print

Offering wrapped assets in the United States is tricky. The firm must show that FXRP is not a new security under the Howey Test. Recent SEC guidance on staking helps, McLoughlin noted, but lawyers still have to confirm that the wrapping process doesn’t create an “expectation of profit” that would bring the product under securities rules. The company expects fewer hurdles in other jurisdictions.

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Why it matters

• User base: Uphold serves more than 10 million accounts across 140+ countries.
• Perks: U.S. customers already earn 4 % XRP back on debit-card spending; yield on idle XRP would make the token even stickier.
• Competition: If successful, the model could become a template for adding staking-style rewards to other non-PoS assets.

For now, the plan remains in the lab, but McLoughlin is confident: “In many regions, wrapping XRP on Flare is a clear, compliant path to offering yield. That’s where we’ll start.”