CoinDesk reported that Ripple is pushing to introduce an institutional lending protocol (XRPL Lending Protocol) to the XRP Ledger (XRPL). The plan is to allow institutions to not only issue or move assets they hold on-chain but also to borrow against them as collateral. The XRPL Lending Protocol adopts a structure that separates the roles of the blockchain and financial institutions. After a loan is made, the blockchain automatically performs fund pool management, interest calculation, repayment processing, and default procedures. In contrast, borrower credit assessment, loan approval, and condition determination will be handled by financial institutions off-chain, as before. The protocol consists of two parts. A Single Asset Vault collects a single asset to create liquidity, and a lending layer operates these funds as loans according to specified conditions.
