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- The XRP Ledger network has expanded its institutional DeFi infrastructure
- The expansion is part of the network’s mission to bring more institutions to the XRP-powered DeFi ecosystem
- XRP Ledger has also improved how DEXs handle order books on the network
The XRP Ledger network has expanded its institutional DeFi infrastructure as part of its mission to bring more institutional users to the blockchain. Ripple Labs disclosed that XRP Ledger is focused on becoming a secure, safe, and “scalable layer 1” for corporate customers building financial applications. As part of expanding its institutional DeFi infrastructure, the network is also working on how its DEXs handle order books by introducing enhanced automated market maker (AMM) models, which may help position the blockchain as a reputable DeFi hub.
Regulatory Compliance Boosts DeFi Adoption
In a blog post, Ripple noted the lack of a compliance-focused and interoperable blockchain infrastructure hinders the adoption of DeFi among corporate users. It added that XRP Ledger offers low fees, high transaction speeds, a regulatory-compliant environment, and a native DEX to “create an advanced institutional DeFi ecosystem.”
According to Ripple, the expansion allows institutions to provide liquidity to generate yield and trade tokenized real-world assets (RWA). It also boosts price accuracy across different DeFi ecosystems through arbitrage and cross-chain swap.
XRP Ledger has also introduced decentralized identity (DID) to help with anti-money laundering and KYC compliance. DIDs will also help to regulate trading venues. The network also uses price oracles to bring market data on-chain for accurate RWA valuation and institutional-grade risk management.
XRP Ledger Lags in DeFi Activities
The expansion comes at a time when XRP Ledger is recording negligible DeFi activities compared to other chains like Ethereum. According to DeFi Llama, the total value locked on XRP Ledger is $80 million compared to Ethereum’s $51 billion and Solana’s $7 billion.
It also comes a year after 80% of XRP Ledger validators agreed to upgrade the platform to enhance functionality. Last year, the network disclosed its planning to roll out smart contracts and other enhancements to attract DeFi and web3 developers to the platform.
With XRP Ledger focusing on courting institutions, it’s to be seen whether corporate DeFi users will flock to the network.
