HomeNewsRipple Redefines Finance: XRP Lending Protocol Shakes Up DeFi

Ripple Redefines Finance: XRP Lending Protocol Shakes Up DeFi

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  • Off-chain negotiation and on-chain recording of loan terms improve transparency and security of the lending process.
  • Ripple’s CTO, David Schwartz, sees the protocol as adding utility to XRPL while addressing regulatory concerns.

Ripple has introduced a lending protocol on the XRP Ledger aimed at enhancing its decentralized finance (DeFi) capabilities.

The protocol, known as 0066 XLS—66d, is designed to create a robust DeFi ecosystem and is currently available for public evaluation on GitHub.

The recently introduced protocol on the XRP Ledger enables straightforward lending and borrowing, bolstering its operations in the decentralized finance (DeFi) arena.

Participants can deposit fungible tokens like XRP, and wrapped Ethereum (wETH) into a lending pool to accrue interest.

Related: CBDCs: Ripple’s Gateway to Mass Adoption

The protocol facilitates the negotiation of loan terms off-chain, which are then recorded on-chain to maintain transparency and security.

RippleX explains that the protocol facilitates fixed-term loans with set interest rates, employing off-chain to eliminate the requirement for collateral.

Additionally, it features a first-loss capital protection mechanism to secure against potential defaults.

Developers can benefit from the protocol’s modular design, which simplifies the integration and development of decentralized lending applications on the XRPL. This development is expected to diversify the practical applications available on the XRPL, increasing its overall utility.

Read more: Pro-XRP Lawyer Illuminates Glimmer of Hope in Ripple vs SEC Showdown

David Schwartz, Ripple’s CTO, expressed that the protocol, if adopted, would add a new layer of utility to the XRPL without alienating traditional financial entities.

However, he noted that some companies might be apprehensive about participating in an unregulated lending product.

The current price of Ripple (XRP) is $0.5174, which reflects a 5.62% increase. Based on this data and performing a technical analysis using trend lines and moving averages, predict that XRP might rise to approximately $0.55 in the short term due to its upward momentum.

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Isai Alexei
Isai Alexei
As a content creator, Isai Alexei holds a degree in Marketing, providing a solid foundation for the exploration of technology and finance. Isai's journey into the crypto space began during academic years, where the transformative potential of blockchain technology was initially grasped. Intrigued, Isai delved deeper, ultimately making the inaugural cryptocurrency investment in Bitcoin. Witnessing the evolution of the crypto landscape has been both exciting and educational. Ethereum, with its smart contract capabilities, stands out as Isai's favorite, reflecting a genuine enthusiasm for cutting-edge web3 technologies. Business Email: info@ethnews.com Phone: +49 160 92211628