Ripple developers Aanchal Malhotra and Vito Tumas have introduced a ground-breaking proposal for a native lending protocol on the XRP Ledger (XRPL). If passed, this proposal is expected to expand the network’s decentralized finance (DeFi) capabilities and increase XRP’s utility.
What The Lending Protocol On XRP Ledger Is About
Ripple’s development arm, RippleX, elaborated in an X (formerly Twitter) post that the lending protocol will allow users to borrow and lend digital assets peer-to-peer (p2p) without the need for “unnecessary intermediaries.” The protocol will utilize a modular design that focuses on “flexibility and reusability.”
Furthermore, the modular design will introduce three specifications. The first is the XLS-64d, which will allow a single pseudo-account to be associated with “multiple ledger entries for tracking balances and issuing tokens.” The second is the XLS-65d, which “defines a new ‘Pool’ ledger entry for a single tokenized asset pool.
XLS-66d is the third specification and will leverage the XLS-65d to manage the assets of Liquidity Providers (LPs). “It also introduces off-chain underwriting, on-chain agreements, and loan management.” RippleX further revealed. Regarding how the lending protocol will operate, LPs will deposit their crypto assets into a lending pool to earn…
