XRP Approaches a Historic Shift with XRPL Lending Protocol

XRP is on the brink of a significant transformation as Ripple unveils the XRPL Lending Protocol. This groundbreaking system introduces protocol-level, fixed-rate institutional credit, potentially revolutionizing global onchain markets by enhancing liquidity and providing new balance-sheet flexibility.
On December 19, Ripple announced the upcoming launch of a new version of the XRPL Lending Protocol, which is designed specifically for institutional adoption. Ed Hennis, a Senior Staff Software Engineer at Ripple, emphasized that this protocol will integrate fixed-term, fixed-rate credit directly into the XRP Ledger.
For the first time, enterprises gain access to predictable, onchain lending designed for institutional use
he explained. Hennis noted that this system eliminates the need for application-layer smart contracts by embedding lending mechanics directly into the XRPL through the XLS-66d amendment.
Each loan will be secured within its own Single Asset Vault SAV , which isolates risk to that specific credit facility. This structure allows the protocol to enforce loan terms and manage risk effectively. Hennis described this as creating an institutional-grade framework with onchain transparency.
The development of the XRPL Lending Protocol is framed as a breakthrough for onchain finance at a global scale. Hennis pointed out immediate use cases such as market makers borrowing XRP RLUSD for inventory and arbitrage. This enables firms to deploy liquidity across venues without tying up their balance sheets.
Custodians, exchanges, and large XRP holders can lend XRP into isolated, underwritten credit facilities to create the first scalable yield venue for XRP s 115B market cap
he noted. He also highlighted that XRP s 124B market cap can now be utilized in institutional credit facilities to generate real yield.
Looking ahead, Hennis mentioned that the relevant amendments are expected to enter validator voting in late January. This marks a significant step towards activating protocol-native credit markets on the XRPL. He concluded with a bold statement about the implications of this development:
This is the first time that protocol-native credit markets have become possible on a global chain. And it positions the XRPL as a settlement and credit infrastructure for real institutions