Ripple: First DeFi protocol based on Flare Networks enters test phase

  • Ripple-funded Flare Networks will have its first DeFi product which is developed by Flare Finance.
  • The XRP community warns of a possible fraud involving Flare Finance.

The expected launch of Flare Networks and its Spark token by December of this year has received further reason to raise the hype. Yesterday, Flare Finance team revealed that they have successfully launched a test network for their system, called Coston. As a result, the Flare Finance team has begun to interact and present themselves to the XRP and Flare community.

Flare Finance’s product, according to its official website, consists of a platform called FlareX that will operate as a decentralized exchange with a multi-token ecosystem: YFLR, YFIN, YMIN in conjunction with SPK and the token FXRP. Furthermore, the platform claims that they will offer “6 revolutionary products” that will allow users to do yield farming and participate in the decentralized governance model.

It will also offer users peer-to-peer trading with margin and spot, non-custodial liquidity pool, decentralized insurance coverage, among others, according to the website which states the following:

Soon, decentralized finance will make it’s way to the XRP Ledger through the use of the Flare Network, a revolutionary approach to enabling smart contracts for the 3rd largest cryptocurrency in the world. Through the use of smart contracts on the Flare Network; Flare Finance opens the door for many new financial products

In celebration of the launch, the platform has announced a giveaway. They have invited users to follow them on Twitter, tag 3 “soldiers” and retweet the giveaway’s announcement. As a reward, participants can win 500 XRP or “100 XRP Spark for 5 soldiers”.

Risk of fraud on Flare’s first DeFi product?

While the announcement of the flare finance team is potentially good news for the future development of the deFi ecosystem, new investors should be cautious. The project has yet to prove its legitimacy. As indicated by members of the crypto community, the Spark Token will be distributed in December.

However, Flare Finance’s announcement states that the winners will receive 100 sparks. The alleged winners will be announced on October 9th of this year, which is not the same date as Flare Networks. In addition, there are other signs of uncertainty that investors should be aware of. For example the lack of activity on the project’s Twitter account. According to Twitter, the account was only set up this month and has only 614 followers.

Apart from the tweet announcing the supposed launch on the testnet, Flare Finance makes no further clarifications. Its main focus seems to be the “pre-launch” giveaway, but there is no scheduled or tentative date either. The project has a page on GitHub, but its first repository was created in early October 2020 and most of what is in subsequent repositories are empty.

A few hours ago the official Flare Networks account raised their voice and posted the following:

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We have spoken to Flare Finance. The project is interesting and we are grateful that they have chosen Flare. Flare’s role is not to approve or disapprove of a project. As with everything do your own research and don’t take risks that you can’t recover from if they go wrong.

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About Author

Reynaldo Marquez has closely followed the growth of Bitcoin and blockchain technology since 2016. He has since worked as a columnist on crypto coins covering advances, falls and rises in the market, bifurcations and developments. He believes that crypto coins and blockchain technology will have a great positive impact on people's lives.

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