BlockBeats News, June 29th, Ripple launched the XRPL Lending Protocol, providing on-chain credit infrastructure for tokenized assets. The core principle of the protocol is to keep credit assessment off-chain, only standardizing the on-chain execution process. Institutions are responsible for underwriting and compliance, while the protocol handles standardized execution, liquidity pooling, loan disbursement, repayment, and default handling.

The protocol consists of two parts: the Single Asset Vault for on-chain pooling of a single asset, and the Lending Protocol, which disburses liquidity from the vault as loans with clear terms. These correspond to proposals XLS-65 and XLS-66, pending validation from validating nodes. At the protocol level, a junior capital mechanism is in place, with the risk exposure allocated to the pool manager ahead of other liquidity providers. Developers can now access and test the protocol on the testnet.