The concept of XRP DeFi is no longer an abstract thought, but is now being tested, developed, and discussed through the work of one of the more vocal builders in cryptocurrency, Cardano founder Charles Hoskinson.
While speaking with Scott Melker about Midnight, a partner chain for Cardano launched late in 2025, Hoskinson referenced Midnight as an example of how XRP DeFi could eventually function. Midnight was designed using zero-knowledge cryptography. The overall goal of Midnight is very straightforward, yet incredibly important, provide privacy to smart contracts while maintaining regulatory compliance. This level of privacy may also be the very thing that has been lacking for XRP.
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XRP DeFi and Midnight’s Privacy Layer
The idea of having XRP wrapped up in Midnight would allow for access into a DeFi system for the xrp holders while keeping all transactions private. Transactions for the following functions will always be kept private: Lending, Borrowing, Yield Farming
The XRPL cannot provide this on its own. Midnight bridges that gap and provides what might be up to $100 Billion worth of XRP that is currently sitting idle in people’s wallets. Midnight is not competition to the XRPL but rather an extension of it.
Midnight was referred to by Hoskinson as a connector chain, it provides a way for different blockchain networks to communicate with each other and also provides added privacy on each link of the connection.
XRP DeFi and New Wave of Collaboration
Hoskinson had several surprises for the XRP community in December. First, he contacted the top 15 XRP projects and invited each to attend a DeFi Summit at the University of Edinburgh. It was clear from his actions that the goal was not competition but cooperation.
Another way that Input Output Global supported the integration of native XRP into the Cardano ecosystem was by supporting the development of the Lace (Cardano’s official wallet). This will make it easier for people to adopt and begin using XRP more quickly.
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