Key Notes
- The XRP Ledger is transforming with new innovations designed to boost institutional adoption.
- Developers are particularly building to permit DeFi participation by institutions.
- Onchain innovations to enhance include DiD, programmability and compliance.
Ripple Devs, an offshoot of Ripple Labs Inc has introduced a new roadmap designed for institutional Decentralized Finance (DeFi) on the XRP Ledger (XRPL). He also boasted of how this iteration is one of the greatest that the protocol has introduced in the past.
XRP Ledger And its Innovations Down the Line
With this new roadmap, the blockchain payment company intends to expand its possibilities for use in various financial applications. David “JoelKatz” Schwartz noted that this Ripple roadmap presents a detailed outline of its direction for this year, including its use cases and features that it plans to focus on.
It’s here – Ripple’s roadmap for institutional DeFi on the XRP Ledger in 2025. As roadmaps go, I (personally) think this one is pretty great – outlining a clear direction with use cases and features (available and to be proposed) of what Ripple will be focused on contributing to… https://t.co/L8WgovxiPJ
— David "JoelKatz" Schwartz (@JoelKatz) February 25, 2025
In the past, XRPL has implemented innovations that have encouraged financial institutions to participate in the market.
These innovations could improve price transparency, liquidity efficiency, and the integration of compliance tools. One such innovation is the Central Limit Order Book (CLOB). This feature allows efficient price discovery and ensures deep liquidity for the assets traded on the network.
Another innovative addition is the Automated Market Maker (AMM), which enhances liquidity automation. Precisely, this XRPL AMM delivers the optimization of the exchange processes that exist between tokenized assets and stablecoins. This solution is largely recognized for its distinct direct integration with the native Decentralized Exchange (DEX).
Last month, XRPL took it a step further by introducing a new AMM feature for holders of the Ripple USD (RLUSD) stablecoin.
XRPL Integration With Ondo Finance
In addition to these innovations, the XRP ecosystem underwent several amendments and upgrades.
The XRP Ledger also secured strategic partnerships that hold potential for expansion. As part of its collaboration, the XRP ecosystem tries to ensure that it contributes to meeting the growing demand for tokenized solutions, especially for Real-world Assets (RWAs).
Ondo Finance partnered with XRPL to debut tokenized US Treasuries for institutional investors. The offering, dubbed Ondo Short-Term US Government Treasuries (OUSG), is backed by the BlackRock USD Institutional Digital Liquidity Fund (BUIDL). Based on its structure, investors can buy OUSG or redeem it anytime using Ripple USD.
What Next For XRP Ledger?
Going forward, XRPL plans to focus on features that improve regulatory compliance while expanding institutional lending options. It is also keen on offering greater programmability to develop onchain financial products. Amongst the incoming innovations are digital credentials based on DID and Multi-Purpose Token (MPT), a new tokenization standard.
While the latter offers access to the creation of regulated financial markets directly on the blockchain, MPT allows for the representation of complex financial instruments. Noteworthy, these updates are still directed towards TradFi integration with DeFi.
Financial institutions can issue tokenized loans securely with XLS-65d, another key addition for institutional DeFi. This will help reduce the dependence on traditional intermediaries and promote more transparency in the credit markets.
The XLS-66d specifications offer benefits, such as on-ledger loans, off-chain underwriting, and first-loss capital protection. These will help ensure that financial risks are managed more efficiently.
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