XRP News Today: XRP MPT Standard Enables Secure, Compliant Institutional DeFi

The XRP Ledger (XRPL) has activated the Multi-Purpose Token (MPT) standard, a native protocol upgrade designed to streamline the tokenization of real-world assets (RWAs) and enhance institutional participation in decentralized finance (DeFi). Launched on October 1, 2025, the MPT standard eliminates the need for custom smart contracts by embedding compliance, control, and metadata directly into the XRPL protocol. This development enables institutions to tokenize assets more efficiently while addressing regulatory and operational challenges. Kenny Zlei, a Ripple engineer, emphasized that MPT tokens include built-in compliance tools such as Know Your Customer (KYC) and Anti-Money Laundering (AML) verification, alongside features like supply caps and restricted transfers to ensure adherence to legal frameworks.

The MPT standard introduces on-chain metadata integration, allowing issuers to embed legal documentation, identifiers, and terms of use directly into tokens. This creates a verifiable and transparent record for asset management. Additionally, the protocol supports multi-signature security through Signer Lists, enabling issuers to delegate operational control while maintaining offline security for master keys. These features aim to reduce the complexity and costs associated with traditional tokenization processes, which often require extensive audits and bespoke contract logic.

Institutional DeFi applications are a core focus of the MPT standard. The protocol supports use cases such as pooled lending, tokenized collateral, and credit verification, with plans to introduce a native lending protocol in XRPL version 3.0.0. This update will enable regulated, low-cost loans to be issued directly on the ledger. MPT tokens also facilitate secondary market trading through decentralized exchanges (DEXs), with AMM (Automated Market Maker) support expected in future upgrades. Kenny Zlei noted that the team is prioritizing incremental development to build a robust foundation for MPT functionality.

Privacy and transaction efficiency are key areas of future enhancement. Confidential MPTs, which enable privacy-preserving transfers, are in the roadmap to address institutional concerns about data confidentiality while maintaining compliance. The MPT standard also allows issuers to apply transfer fees, offering flexibility in managing transaction costs. These features align with Ripple's broader strategy to integrate privacy tools like zero-knowledge proofs into the XRPL ecosystem.

Ripple's institutional strategy emphasizes tokenized assets and stablecoins as pillars for expanding the XRPL's utility in payments, lending, and settlement. The MPT standard positions the XRP Ledger as a platform for secure, scalable, and compliant asset tokenization, with a focus on bridging traditional finance and blockchain infrastructure. As the protocol evolves, the integration of MPT tokens into DeFi ecosystems is expected to drive liquidity and foster broader adoption across industries.

[1] XRP Ledger Launches MPT for Real-World Asset Tokenization (https://coingape.com/xrp-ledger-rolls-out-mpt-standard-for-real-world-asset-tokenization/)

[2] XRP Ledger Rolls Out MPT Tokens to Enhance Real-World Asset Use (https://coincentral.com/xrp-ledger-rolls-out-mpt-tokens-to-enhance-real-world-asset-use/)

[3] Multi-Purpose Token (MPT) standard goes live on XRP Ledger ... (https://www.cryptopolitan.com/mpt-standard-on-xrp-ledger-mainnet/)

[4] XRP Ledger Launches MPT Standard to Enable Real-World Asset ... (https://www.livebitcoinnews.com/xrp-ledger-launches-mpt-standard-to-enable-real-world-asset-tokenization/)