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Ripple proposes XRPL lending protocol for institutions; approval by validators still required
Ripple has proposed an XRPL Lending Protocol that would let institutions borrow against tokenized assets on the XRP Ledger. The system automates loan mechanics on-chain while keeping credit decisions with human underwriters off-chain. Testing on a development network begins Monday.
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Ripple has proposed an XRPL Lending Protocol that would allow institutions to borrow against tokenized assets held on the XRP Ledger, CoinDesk reported. The protocol is defined in technical drafts XLS-65 and XLS-66 and remains subject to approval by XRPL validators.
The blockchain layer would automate loan mechanics including pooling, interest accrual, repayment enforcement, and default processing.
Credit decisions and underwriting would stay off-chain with lending institutions' human credit teams. The protocol uses Single Asset Vaults to pool a single asset for lending. Features are currently available only on a development and test network and are not live on the main XRPL.
Infrastructure providers and developers can begin integrating and testing on a testnet starting Monday, June 30, 2026. One use case described involves short-term financing where a payment company borrows against RLUSD reserves to fund outgoing payments before a two-day cross-border settlement clears.
The protocol is separate from XRP and from RLUSD, though RLUSD is one asset that could be lent against.
It targets institutional users and is not intended as a direct retail product. Existing on-chain lending protocols include Aave, Compound, Maple, and Clearpool. The XRPL Lending Protocol proposals are subject to validator approval in the coming weeks, CoinDesk reported.
