XRP Ecosystem Diversification: New Yield Products Spark Internal Conflicts in the Community

The Ripple ecosystem has been making moves again. Interop Labs and Midas have teamed up to launch mXRP—a yield-bearing token for XRP, claiming to offer holders up to 10% APY. Sounds good, but the community is in an uproar.

The Collision of New Gameplay vs Old Beliefs

The logic of mXRP is as follows: you lock XRP as collateral to mint mXRP, and then run DeFi on the Axelar network to earn returns. This thing is issued on Axelar (founded by Interop Labs) and is realized through the EVM-compatible network of XRPL.

In simple terms, this is using Ripple's assets as a springboard to channel liquidity to other chains.

The problem arises: The XRP community begins to tear apart.

On one side are the optimistic voices — this adds new use cases for XRP, just like what Flare has already done (Flare also has XRP yield products and even launched XRP collateral stablecoin lending).

On the other side are discontented voices—well-known XRPL validator “Vet” speaks frankly: You are siphoning off from XRPL. He believes that these profit strategies should be implemented within the XRP Ledger's own ecosystem, rather than being funneled to an external protocol like Axelar.

The logic of Vet is interesting

The core argument of Vet:

• XRPL is the true “OG decentralized exchange” and should prioritize attracting liquidity back to the main chain.
• Now XRP has gone to earn yields on someone else's chain, which is seeking distance instead of staying close.
• XRP as a bridging currency has immense value, but the premise is that the activity level of DEX must increase.

In other words: Rather than earning 10% APY on Axelar, it's better to focus on building XRPL and making XRP a true liquidity hub.

Behind the Industry Phenomenon

This controversy reflects a deeper issue within the Web3 ecosystem: it is becoming increasingly difficult to maintain the moat of a single public chain. Everyone is working on interoperability and cross-chain asset utilization, resulting in scattered liquidity.

Flare follows a similar logic — unable to compete with Lido's dominance on Ethereum, it takes a different approach to create staking derivatives for XRP. Midas and Interop Labs also want to carve out a piece of this cake.

But the question is: if all XRP earns revenue on external chains, how will the XRPL ecosystem itself survive?

Underlying Thoughts

This controversy is essentially a trade-off question:

• Embrace interoperability to expand the application radius of XRP
• but it may also deplete the core ecosystem of XRPL

Vet's concerns are not without reason, but it is unrealistic to completely confine XRP to the XRPL. The key is for Ripple Labs to clarify for themselves: do they want to be the “universal settlement currency” or the “native currency of the XRPL ecosystem”? These two positions follow different paths.