Ripple Reviews XRP Ledger Loan Protocol XLS-66

Ripple has presented the single asset vault (XLS-65) and loan protocol (XLS-66) of the XRP Ledger (XRPL) as core features of an on-chain credit infrastructure for institutions. Both proposals have been included in the relevant software, but the review and voting procedures for mainnet activation have not yet been completed. Ripple stated that institutions will assess borrower eligibility and regulatory compliance off-chain, while the protocol standardizes loan execution, repayment, and condition enforcement. The single asset vault functions to pool loan funds, gathering one type of asset from XRP, trustline tokens, or multi-purpose tokens (MPT) to supply to other on-chain protocols. Loan creation requires signatures from both the loan broker and the borrower, with credit and regulatory compliance being assessed off-chain. Currently, XLS-66 lacks automated on-chain collateral management and liquidation management, distinguishing it from existing DeFi loans. The XRP Ledger amendment must maintain a validator support rate above 80% for two weeks to be activated. The XRP Ledger version 3.1.0, released on January 28, included support codes for both features. Security firm Halborn has audited the loan protocol from July 21 to August 5, 2025, identifying 13 issues, all of which have been addressed. The community has expressed both expectations and concerns regarding this development.

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