Developer Hugo Philion, cofounder and CEO of Flare Networks, has proposed a design to redeem assets from Flare on XRP Ledger. This mechanism will act as an interoperability bridge between XRPL and Flare systems.
"Closing the circle"
Flare, a much-anticipated "utility fork" of XRP instruments, may receive a Flare-XRP interoperability tool for seamless assets redemption. Yesterday, Oct. 8, its description has been submitted as a proposal.
Closing The Circle. Trustlessly issuing, using and redeeming assets on the XRP Ledger using #Flare. #XRP #UnlockingValue https://t.co/Tov4uyPETq
— Flare (@FlareNetworks) October 8, 2020
According to the project rationale, very few assets that exist on XRP Ledger can be treated as "trustless." Actually, they are referred to as "IOUs" and are highly dependent on the issuers. With the new proposal, every user of both systems can issue XRPL-based assets leveraging the features of Flare smart contracts.
Once value is locked into Flare smart contracts, the user should set a trustline to the XRP account ("receiving"), issue tokens and authorize the process of redemption by unique keys.
The integrity and atomicity of the redemption will be kept by Flare's State Connector. It will effectively protect users from malicious issuance of tokens and sending them to invalid addresses, as well as from key abuse.
DeFis on XRPL are right around the corner?
Mr. Philion emphasized that, with a new design, many assets can be tokenized on the XRP Ledger. The suite of XRPL-based assets can include fiat currencies, equities, stocks, etc.
Also, the decentralized character of Flare's collateralization of assets issued on XRPL eliminates the necessity for market participants to use additional financial analysis tools for verification.
As covered by CryptoComes previously, the first DeFi protocol on Flare, Flare Finance, has unveiled its plans for a testnet launch. A decentralized cryptocurrencies exchange, a lending/borrowing ecosystem and a governance mechanism will be launched under its umbrella.
According to the Flare Finance team, the testnet iteration of its protocol is up and running.
