The native lending feature of XRP Ledger has not yet been officially launched, but the protocol upgrade continues to progress. According to Vet, a verifier from XRPL, Lending Protocol and v1.1 are expected to be released along with XRPL version 3.4.0 next week. These updates will mainly include fixes to initial issues and improvements to functionality, and will also continue to support the development of Single Asset Vaults.
The lending function is still stuck in the governance voting process.
Currently, the official amendment tracking page for XRPL labels LendingProtocolV1_1 as "under development." This update makes adjustments to the lending specifications of XLS-66, which includes adding a MemoData field to VaultDelete transactions.
However, the incorporation of code into a software version does not mean that the feature has been activated on the mainnet. The amendment mechanism of XRPL requires continuous support from verifiers; only after reaching a threshold of 80% will the relevant feature officially take effect.
The XRPL version 3.1.0, which previously introduced the Single Asset Vaults and Lending Protocol codes, was released in January of this year. However, the support rate for these two features among verifiers is still below the activation requirements. This means that XRPL's native lending function is currently still in the governance approval stage, rather than simply waiting for the version to be released.
Single Asset Vaults Promoted in conjunction with lending protocols
The core of this architecture is to have Single Asset Vaults provide the underlying liquidity, while Lending Protocol supports fixed-term, unsecured pooled lending. Credit review and risk management are carried out off-chain.
Since these two parts need to work together in design, the votes of verifiers become even more crucial. Even if the protocol code is continuously updated, if the relevant amendments do not receive sufficient support for a long time, the native lending market of XRPL will still not be able to truly launch.
Institutional lending scenarios have been pre-arranged in advance.
Although the functionality has not yet been activated, the institutional lending framework based on XLS-65 and XLS-66 has already been established. Ripple, Clearpool, and Cicada Partners are working on building an institutional lending market around this system.
Among them, the cumulative scale of institutional loans facilitated by Clearpool has exceeded $930 million, and the credit scale underwritten by Cicada has surpassed $860 million. According to the figures mentioned in the text, the two together bring about $1.8 billion in historical lending and underwriting experience.
The article mentions that in the future, this model may use RLUSD as the borrowing asset for institutions, while Single Asset Vaults will play the role of the underlying liquidity infrastructure.
For the holders of XRP, this upgrade does not mean that holding the coins will automatically generate profits. Even though the vault can be configured to hold XRP, whether they will actually participate in lending still depends on the market structure design and whether the relevant amendments can ultimately be passed.
Overall, XRPL is gradually making the lending functions outside of the payment network a reality. The bigger issue at present is no longer whether the technology exists, but rather when the verifiers will be willing to allow it to proceed.
