Ripple Proposes XRPL Lending Protocol on June 29, Separating Credit Decisions From Blockchain Execution

According to Ripple, on June 29, the company proposed the XRPL Lending Protocol to create standardized credit infrastructure for institutions using tokenized assets on the XRP Ledger. The protocol separates underwriting and compliance decisions off-chain while placing loan servicing, repayment, interest, and default mechanics on-chain, allowing institutions to use digital asset versions as working capital.

The proposal defines two components: the Single Asset Vault for pooling and managing a single asset, and the Lending Protocol for originating and servicing loans. Both amendments, specified in XLS-65 and XLS-66, remain subject to validator approval, though developers can begin testing on devnet. Potential use cases include payment providers seeking liquidity against stablecoin reserves and inventory financing for market makers.