XRP News Today: XRPL Lending Protocol Sparks Institutional Demand, Curbs XRP Selling Pressure

Market Analyst Urges XRP Holders to Avoid Selling as Institutional Lending Protocol Looms

Ripple's XRP Ledger (XRPL) is set to introduce a groundbreaking lending protocol, positioning the cryptocurrency for a new era of institutional adoption and utility. This protocol will enable fixed-term, fixed-rate, and underwritten credit at the protocol level, offering XRP holders the potential to earn institutional-grade yield. Market analysts and Ripple engineers are highlighting the significance of this development, as it marks a shift from speculative trading to productive capital use.

The lending protocol, governed by validators and embedded via the XLS-66d amendment, eliminates reliance on smart contracts and introduces risk isolation through Single Asset Vaults (SAVs). Each loan will be contained in its own vault, holding only one asset such as XRP or RLUSD, ensuring risk is segmented and defaults do not cascade across the system. This design aligns with institutional expectations for credit infrastructure, emphasizing predictability and compliance.

Validator voting on the amendments is expected in late January, signaling a key step toward activating protocol-native credit markets on XRPL. Ripple's software engineer, Edward Hennis, described the development as a "liquidity pump" for the network, enabling sophisticated DeFi strategies and cross-border funding. The move is expected to enhance XRP and RLUSD utility, particularly for institutional players seeking stable yield opportunities.