CoinDesk reported that Ripple is pushing to introduce an institutional lending protocol (XRPL Lending Protocol) on the XRP Ledger (XRPL). The plan is to allow institutions not just to issue or move assets they hold on-chain, but also to obtain loans using these assets 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 manages the fund pool, calculates interest, processes repayments, and handles default procedures. In contrast, borrower credit assessment, loan approval status, and condition determination will continue to 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 predefined conditions.
