Ripple unveils XRPL Lending Protocol for institutions

Ripple launches the XRPL Lending Protocol, enabling institutions to borrow against tokenized assets with off-chain credit checks and on-chain execution. The open-source blueprint is developed with VS1 Finance.

Ripple has launched the XRPL Lending Protocol, designed to enable institutional-grade borrowing on the XRP Ledger. This protocol allows institutions to borrow against tokenized assets, with credit assessments handled off-chain by institutions and loan execution automated on-chain through standardized rules. Key features include Single Asset Vaults for liquidity pooling and a Lending Protocol for issuing fixed-term loans, both formalized under standards XLS-65 and XLS-66, which are currently pending validator approval. The XRP Ledger Foundation has partnered with VS1 Finance to develop an open-source, permissioned lending blueprint using native XRPL primitives, ensuring a compliant and secure framework for regulated on-chain lending. This initiative targets institutional credit markets, offering developers a legal and technical template while reducing security risks by avoiding external smart contracts. The protocol is available for testing on the devnet and includes mechanisms such as subordinated capital to enhance security for liquidity providers.