Charles Hoskinson, the founder of Cardano, has shared a new idea that could give XRP holders access to DeFi. In a recent livestream, he said that Midnight, Cardano’s new privacy-focused sidechain, could be used as a DeFi platform for the XRP community. His goal is to offer XRP holders access to better yields and more utility than what’s currently available on the XRP Ledger.
Midnight was first introduced in 2022 and is being built by Cardano’s development company, Input Output Global (IOG). The sidechain is designed for private smart contracts using Cardano’s extended UTXO model. It launched its testnet in 2024 and is expected to go live later this year.
Moreover, Hoskinson explained that Midnight isn’t just for ADA. It could also become a DeFi hub for tokens like XRP, which don’t support smart contracts natively. To participate, XRP holders would bridge their tokens over to Midnight. Once bridged, they could earn yields through DeFi protocols, staking, yield farming, or providing liquidity, just like users of other smart contract platforms.
#Cardano Founder Seeks to Provide ‘Much Better Yields’ for $XRP Holders.🧵🧵🧵 pic.twitter.com/Dr5G3slVms
— TheCryptoBasic (@thecryptobasic) June 16, 2025
The plan doesn’t stop there. Midnight will also feature the “Glacier Drop,” an airdrop that will distribute NIGHT and DUST tokens to about 37 million wallets, including those connected to the XRP Ledger. That means XRP holders could receive airdrop tokens just by holding XRP in qualifying wallets.
In addition to Midnight, Hoskinson said XRP will be supported by Lace, Cardano’s non-custodial wallet. There are also talks about integrating RLUSD, Ripple’s upcoming stablecoin, into the Cardano ecosystem. Altogether, Hoskinson describes this as a “whole package” for XRP: bridging, yield farming, wallet access, and stablecoin support.
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This move comes shortly after Uphold and Flare Network announced a similar plan to bring XRP into DeFi. That partnership also aims to let XRP holders earn yields through staking and other decentralized services.
Hoskinson’s vision is to make Midnight a go-to DeFi hub for XRP holders, one that offers privacy, smart contract features, and passive income options. It’s a strategic effort to bring Cardano and XRP closer together and unlock new possibilities for both communities.
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