XRPL credit protocol without smart contracts


The XRP Ledger XRPL is close to launching a financial market protocol as part of its ongoing development of a native lending protocol for the blockchain. This was confirmed by Panos Mekras, co-founder of Anodos Finance.

Mekras referred to the presentation by Luc Bocahut, Product Director and Solutions Architect at XRP Ledger Commons. Bocahut’s presentation focused on the history of XRPL and how it was designed to overcome the limitations of crypto and fiat currencies.

The development

Over the years, XRPL has become one of the most robust Layer 1 blockchains, supporting, among other things, Non-Fungible Tokens ( NFT ). Additionally, Bocahut mentioned support for native decentralized exchanges (DEXs), as well as advanced payments and issued assets. During the presentation, the director introduced some features that are up for vote and those that are in development. From the list, the lending and borrowing protocol was highlighted as being under development. It is important to note that decentralized lending primarily uses smart contracts. Interestingly, XRPL does not support this, although its competitor Stellar recently introduced its first smart contract. It is reported that XRPL Labs’ Hooks protocol was intended to introduce smart contract functionality to XRPL. However, its widespread adoption has not been encouraging, leading to a delay in the launch of the smart contract.

XRPL credit protocol without smart contracts

David Schwartz, Ripple’s chief technology officer, has already spoken out on the topic, citing two potential problems for hooks in the ecosystem. According to him, there is a significant financial risk that could arise from possible errors in the function that could affect the integrity of the XRPL. He also explained that the introduction of Hook makes XRP Ledger an Ethereum-like network. He believes this could change the core purpose of XRPL as a seamless payment protocol.

The data presented by Bocahut suggests that XRP Ledger lending works even without  smart contracts  . According to Panos Mekras, the introduction of the DeFi lending protocol on the XRPL network would improve DeFi functionality.

A decentralized automated market maker (AMM) should also be put to the vote. According to the presentation, this increases the liquidity of tokenized assets but also enables liquidity provision. Decentralized Identity is also up for vote. It is an interoperable global standard that improves identity management for compliance, authentication and access management. Another feature up for vote is the XRPL sidechain. This is a customized version of the XRP Ledger that meets the needs of a specific use case while remaining interoperable.

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It is important to note that the XRP Ledger creator must submit any development to the community for discussion. After this phase, the creator could submit a PR and put it up for a vote. If the change receives 80% approval from validators for two weeks, it will be implemented. Development can also be organized by the various builders on the network, including XRPL Labs and Ripple .

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