Ripple proposes XRPL Lending Protocol for institutional credit
DeFi & Yields ·
The new standard would let institutions borrow against tokenized assets directly on the XRP Ledger while keeping loan underwriting offchain.
Ripple has put forward the XRPL Lending Protocol, a proposed standard designed to let institutions borrow against tokenized real-world assets using the XRP Ledger, according to ripple.com. The protocol is described as credit infrastructure rather than a yield-farming product, positioning it as a tool for institutional balance-sheet activity rather than retail speculation.
Under the proposed design, loan execution — the actual movement and settlement of funds — would happen onchain, while credit underwriting, the process of assessing borrower risk and setting loan terms, would remain offchain. Ripple frames this split as a way to standardize how loans are executed on the ledger while leaving institutions in control of how credit decisions are made, an arrangement aimed at meeting institutional requirements for oversight and compliance rather than fully automating lending through smart contracts.
The mechanism centers on borrowing against tokenized assets, meaning real-world assets that have been represented in tokenized form on the XRPL, which would serve as collateral for onchain loans. This distinguishes the proposal from conventional DeFi lending pools that typically rely on crypto-native collateral and fully onchain interest-rate mechanics.
Coverage of the announcement has circulated across multiple accounts, including a post on x.com describing the protocol as letting institutions borrow against tokenized assets onchain. Descriptions of the launch converge on the same framing: a standard meant to bring institutional credit activity onto the XRPL without ceding underwriting control to onchain code.
What remains unspecified is how the protocol will handle key operational details — including which categories of tokenized real-world assets will be eligible as collateral, how offchain underwriting decisions will be verified or reconciled with onchain loan execution, and which institutions, if any, are already positioned to use the protocol. Ripple's own materials describe the proposal as a new standard, but a formal launch timeline, technical specification, and governance process for adoption on the XRP Ledger have not been detailed in the available reporting.