Cardano Founder Says Midnight–XRP DeFi Integration Could 'Blow Legacy Banks Out of the Water'

Source: CryptoNewsNet Original Title: Cardano Founder Sats Midnight–XRP DeFi Integration Could ‘Blow Legacy Banks Out of the Water’ Original Link: In recent commentaries, Cardano founder Charles Hoskinson argues that integrating Midnight with XRP Ledger-based DeFi could fundamentally disrupt legacy banking systems and has outlined plans to introduce more efficient and potentially lucrative yield-bearing opportunities for XRP.

Midnight-XRP DeFi Integration Will Challenge Traditional Banking

Hoskinson argues that integrating Midnight with XRPL DeFi could “blow legacy banks out of the water.” Midnight, Cardano’s privacy sidechain, is built to support confidential smart contracts while remaining aligned with regulatory requirements. It enables sensitive financial data to stay private on-chain while still allowing regulators and institutions to verify transactions when necessary through selective disclosure.

Meanwhile, the XRP Ledger has long been known for its fast, low-cost payments and institutional-grade infrastructure. However, its DeFi ecosystem has lagged behind other networks due to the absence of native smart contract functionality. While several projects have introduced DeFi solutions for XRP, adoption remains relatively modest compared to more established DeFi platforms.

Hoskinson argues that pairing XRP’s fast settlement layer with Midnight’s privacy smart contracts could produce a financial system that operates more efficiently than legacy banks.

Addressing the Shortcomings of Traditional Banking Models

His commentary reflects the widespread belief that banks rely on outdated and slow infrastructure. In contrast, an XRP DeFi environment powered by Midnight could offer near-instant settlement, lower costs, and programmable financial products while maintaining compliance and privacy.

Such a system could replicate core banking functions, including payments, lending, and settlement, without the friction of intermediaries.

This is not the first time Hoskinson has cited Midnight and XRP to challenge legacy finance’s capabilities. Last week, he argued that both XRP and Midnight are “100x” ahead of traditional financial systems, particularly in the real-world asset (RWA) tokenization sector. That recognition sparked a positive exchange between Hoskinson and other industry figures.

While Hoskinson has revealed plans to ramp up efforts around XRP DeFi initiatives and promised to intensify discussions next year, specific details regarding when a fully functional product will reach the market have not yet been disclosed.