Из жизни альткоинов

Комиссия по ценным бумагам и биржам Таиланда (SEC) ужесточила правила проведения первичного размещения токенов (ICO), объясняя изменение норм защититой интересов держателей криптоактивов.

Аналитики компании Santiment, изучающей поведение криптоинвесторов в социальных сетях, рассказали, что аудитория трейдеров поддерживает пессимистический сценарий, ожидая дальнейшего падения стоимости биткоина.

Налоговая служба Швеции расследовала деятельность двадцати одной компании, занимавшейся майнингом биткоина в период с 2020 по 2023 годы. Ведомство считает, что компании предоставили искаженную информацию.

Как сообщает издание Bloomberg, криптовалютная биржа Binance получила лицензию поставщика услуг виртуальных активов (VASP) в Дубае, благодаря которой сможет предоставлять услуги местным розничным трейдерам.

Генеральный директор компании Coinify Рикке Стаер считает, что сокращение вознаграждения майнерам вдвое сделает нерентабельной работу части устройств по добыче биткоина.

Адвокат бывшего разработчика Эфириума Вирджила Гриффита направил ходатайство судье Окружного суда Южного округа Нью-Йорка Кевину Кастелу с требованием смягчить наказание для своего подзащитного.

Крупнейшая криптобиржа мира Binance намерена вернуться на индийский рынок, заплатив штраф $2 млрд для обеспечения соблюдения Закона о предотвращении отмывания денег (PMLA).

In a landmark move aimed at bringing stability and oversight to the rapidly expanding world of digital finance, US Senators Kirsten Gillibrand and Cynthia Lummis have unveiled the Lummis-Gillibrand Payment Stablecoin Act. The legislation, which has been in the works for months, seeks to establish a comprehensive regulatory framework for payment stablecoins, addressing concerns surrounding their use and potential risks.

Bipartisan Effort To Tackle Stablecoin Regulation

The introduction of the Lummis-Gillibrand Payment Stablecoin Act marks a significant bipartisan effort to address the regulatory challenges posed by stablecoins. With senators from both sides of the aisle coming together, there is a clear recognition of the need to strike a balance between fostering innovation in the digital finance space and ensuring adequate safeguards are in place to protect consumers and maintain the stability of the US dollar.

Promoting Responsible Innovation And Protecting Consumers

Central to the proposed legislation is the aim to promote responsible innovation while safeguarding the interests of consumers. By requiring one-to-one reserves for stablecoin issuers and establishing state and federal regulatory regimes, the bill seeks to create a transparent and accountable environment for stablecoin operations. This move is expected to instill confidence among users and investors while mitigating the potential risks associated with unbacked or algorithmic stablecoins.

I’m proud to join @SenLummis to introduce the Payment Stablecoin Act.

Passing a regulatory framework for stablecoins is critical to protecting consumers, promoting responsible innovation, and cracking down on money laundering and illicit finance. https://t.co/UP9pk0uQkt pic.twitter.com/lIqA3rwQXN

— Sen. Kirsten Gillibrand (@gillibrandny) April 17, 2024

The legislation also addresses concerns surrounding illicit activities and money laundering, with provisions aimed at preventing such activities within the stablecoin ecosystem. Senator Gillibrand emphasized the importance of passing a regulatory framework to crack down on illicit finance and maintain the dominance of the U.S. dollar in the global financial landscape.

Incorporating Stakeholders And Ensuring Proper Custody Practices

One notable aspect of the Lummis-Gillibrand Payment Stablecoin Act is its inclusion of various stakeholders in the regulatory process. State non-depository trust companies and authorized institutions would be allowed to issue stablecoins under specified conditions, promoting diversity and competition within the industry while ensuring adherence to regulatory standards.

Stablecoins: Addressing Concerns And Building Consensus

While the introduction of the Lummis-Gillibrand Payment Stablecoin Act represents a significant step forward in the regulation of stablecoins, challenges remain. Concerns from lawmakers, such as Senator Sherrod Brown, underscore the need to address various issues and build consensus within the legislative process.

Nevertheless, the unveiling of this legislation signals a growing acknowledgment of the importance of stablecoin regulation in the United States. As discussions continue and stakeholders engage in dialogue, the aim remains clear: to create a regulatory framework that promotes innovation, protects consumers, and ensures the stability and integrity of the financial system in the digital age.

Featured image from Xank, chart from TradingView

Известный энтузиаст биткоина и основатель Pomp Investments Энтони Помплиано заявил, что благодаря своим качественным монетарным принципам, капитализация биткоина превзойдет показатели золота.

В Городищенском районе Волгоградской области энергетики компании «Россети-Юг» совместно с полицией пресекли деятельность сразу трех майнинговых ферм.

The XRP lawsuit between Ripple Labs and the US Securities and Exchange Commission (SEC) over the status of XRP as a security is poised to escalate to the US Supreme Court. This anticipation has been reinforced by a recent ruling in the Coinbase case, which favored the SEC, as presided over by Judge Katherine Failla of the Southern District of New York.

XRP Lawsuit Going To The US Supreme Court?

Ladan Stewart, former chief of the SEC’s crypto litigation unit, spoke on a panel at Columbia Business School, revealing these insights into the agency’s regulatory stance and future directions. Despite leaving the SEC, Stewart’s comments still reflect deep ties to the agency’s strategies and their implications for the crypto industry.

During the panel, Stewart acknowledged the impact of Judge Failla’s decision in the Coinbase case, stating, “It’s probably going to give the SEC that sort of comfort it needs to proceed as it has been,” and reinforced that the agency “is not going to back off of bringing regulatory cases in the crypto space.”

Notably, she also reinforced the likelihood of one of the lawsuits brought against companies like Ripple and Coinbase ascending to the Supreme Court to resolve fundamental questions about the definition of securities within the crypto space, as Fortune reports. “Then there will be some definitive sort of clarity on that question,” Stewart said.

The discussion also covered the broader implications of how digital assets are treated under US law, highlighting ongoing disputes about whether tokens themselves are securities, or if it is the manner of their sale that creates an investment contract. Stewart clarified, “The underlying asset is not a security, but its offer and sale.”

Panelists including Rebecca Rettig from Polygon and Lewis Cohen from DLx Law provided contrasting views. Rettig, legal counsel for Polygon, pressed Stewart on practical implications, specifically asking, “But then what do you register?” Stewart’s response that both the token and “all the stuff around the token” are considered for security status, did not satisfy panelists, highlighting a persistent area of contention between the crypto industry and regulatory bodies.

Lewis Cohen of DLx Law argued that the SEC’s approach might lead to regulation by enforcement—a criticism often levied by crypto advocates. Cohen questioned the practical application of securities law as interpreted by Judge Failla in the recent Coinbase ruling, suggesting it may not align with the realities of digital asset markets.

The discussion underscored a fundamental industry dilemma: how can crypto companies operate within the law if the rules remain unclear or impractical? This question remains at the heart of ongoing disputes and is central to the broader dialogue around the future of crypto regulation.

Stewart’s final comments at the event underscored the civil but charged nature of these discussions, “We’re all friends,” she concluded, marking a polite yet firm acknowledgment of the ongoing debates that are likely to shape the future of crypto regulation in the United States.

Ripple’s CEO, Garlinghouse, has previously expressed a firm commitment to battling the SEC over the status of XRP, declaring, “We are in it till the end.” Additionally, Stuart Alderoty, the Chief Legal Officer at Ripple, noted last year that the Supreme Court has consistently decided against the SEC in various cases over recent years.

At press time, XRP traded at $0.49659.

По данным Google Trends, количество поисковых запросов о халвинге биткоина растет, и уже достигло исторического рекорда.

Over the years, crypto hacks have become more elaborate and common. In 2024, the community has seen hundreds of millions swept away from exploits and scams, leaving investors empty-handed.

Sometimes, the exploiters return the funds and point out a project’s vulnerabilities, helping prevent future incidents. However, it’s more common to see hackers take the stolen funds and flee the scene.

Crypto investigator ZachXBT unveiled a chain of exploits seemingly connected to the self-called Whitehat hacker responsible for the Prisma Finance exploit that took $12 million last month.

Stained Whitehat Hacker

On March 28, Prisma Finance, the Ethereum-based decentralized lending protocol, suffered a hack that stole 3,479.24 ETH. After being warned and observing the suspicious activity, Prisma’s team alerted the community.

At the time, the hacker contacted the Prisma team through an on-chain message, declaring to be a “Whitehat” looking out for users. During their conversation, the exploiter claimed they wanted to “raise better awareness on serious contract audits” and the use of DeFi.

The following day, the lending protocol released a detailed post-mortem of the incident. This post seemingly ruffled the hacker’s feathers, as they demanded that the team change all the “accusatory terms” like ‘exploit’ and ‘hacker.’

The messages raised alarms about whether the funds would be returned. Seemingly unsatisfied with the Prisma team’s compliance to edit the post-mortem post, the exploiter asked for a bounty of $3.8 million, worth 34% of the total funds.

1/ An investigation into the alleged $11.1M @PrismaFi exploiter 0x77 (Trung) and the multiple other exploits they are connected to. pic.twitter.com/QU1Oy7Txbb

— ZachXBT (@zachxbt) April 16, 2024

The amount asked was triple the industry standard of 10%. According to the crypto detective, the exploiter was “essentially extorting the team” as the treasury didn’t have enough funds to reimburse the victims.

Despite the Whitehat claims and apparent discomfort with terms that stated otherwise, the hacker contradicted himself by sending the funds to Tornado Cash. Further investigation by the crypto detective revealed that this Whitehat has several stains.

Prisma’s Exploiter Connected To Several Crypto Hacks

ZachXBT’s deep dive into the timing of related transactions resulted in the discovery of “activity connected to them on Tron.” One address, TGviNZ, was linked to numerous exploits.

Per the investigation, TGviNZ was funded by the Arcade_xyz exploit from March 2023. During this incident, the exploiter requested additional funds from the project via Telegram.

Similarly, the address was connected to the Pine Protocol exploit from February 2024. This time, the hacker asked for 50% of the funds and allegedly made “additional unreasonable requests over email.”

The crypto sleuth then discovered that TGviNZ is linked to the deployer of Modulus protocol, a “decentralized, non-custodian platform.”  Further investigation revealed that an X user, “0x77,” was among the few followers of the protocol.

This proved crucial in piecing together the puzzle, as the Arcade exploiter used the alias “0x77” on Telegram. A deeper look into the phone number, email addresses used, and other details pointed out the same suspect behind these exploits.

The details of the suspected exploiter are now in the hands of the Prisma team, which is investigating whether to pursue legal action against the individual in Vietnam and Australia.

In a recent announcement, Tools for Humanity, the company behind Worldcoin, revealed the upcoming launch of World Chain. The open-source Ethereum layer-2 blockchain will debut in mid-2024 and aims to transform human authentication through its integration with the Worldcoin protocol. 

Worldcoin Unveils World Chain

Worldcoin is a project aspiring to become the world’s largest identity and financial public network. By employing iris scanning technology via smartphones or specialized devices known as Orbs, Worldcoin transforms biometric images into encrypted numerical codes. 

Combined with algorithms, these codes verify the individual’s unique human identity. The World ID app is a digital passport that allows users to authenticate themselves across web, mobile, and decentralized applications.

Tools for Humanity considers the new upcoming blockchain necessary to transition from existing networks to a dedicated infrastructure. According to the protocol’s website, more than 5 million people from 160 countries have signed up, and the verified wallets have facilitated 49 million transactions. 

However, with the launch of World Chain, Worldcoin aims to increase scalability, provide a dedicated network for its user base, and attract more users and participants to the project’s ecosystem. 

The proliferation of automated transactions, estimated to account for 80% of all blockchain activity, poses challenges such as network congestion. World ID aims to address this, ensuring an inclusive and secure ecosystem. The announcement continues:

Our immediate goal is to increase the L2 block gas limit by a significant factor. As this comes with risks and cannot be done blindly, we are conducting it in a safe way, supported by researching the worst case performance scenarios. 

Convenient Token Usage And Fee Payments

While Worldcoin transactions currently run on the Optimism OP Mainnet, the integration with World Chain will reportedly allow for frictionless deployment across multiple blockchain networks. 

Additionally, World Chain will maintain Ethereum as its native token, ensuring compatibility with the Ethereum ecosystem. However, Worldcoin token holders will be able to use their tokens to pay transaction fees. 

In tandem, Worldcoin grants, distributed biweekly to verified individuals, will be available for immediate use within applications on the chain.

Ultimately, as the launch approaches, industry observers eagerly await the impact and reception of this new Ethereum layer-2 solution. Despite Worldcoin’s vision, the market cap and token price have experienced fluctuations. 

As of the time of writing, the native token of the Worldcoin project, WLD, is currently trading at $4.86. This represents a significant price decline of over 45% in the past 30 days, with a further 25% drop occurring in the past seven days.

According to data from CoinGecko, WLD’s market capitalization has decreased from its peak of $1.4 billion on March 26 to its current value of $950 million. 

However, since the announcement, there has been a notable increase in trading volume, surging by 6.40%. Additionally, the token has experienced a slight uptick of 3% following the disclosure.

Featured image from Shutterstock, chart from TradingView.com

While the Bitcoin community fixates on the upcoming halving and wavy interest in spot exchange-traded funds (ETFs), a looming threat could hinder its growth and adoption of the world’s most secure network: fragmentation of token standards.

Token Issuing Standards On Bitcoin Fragmented

In a post on X, one analyst pointed out the proliferation of competing token issuance standards in Bitcoin. Some popular ones, including the BRC-20 and Inscriptions, are vying for dominance ahead of the planned launch of Runes after Halving. 

In essence, token standards, regardless of the network, ensure compatibility and help harmonize the broader ecosystem. Through the BRC-20 standard, for instance, project developers planning to issue tokens know the rules and guidelines that guide token creation and management. With clear token standards, it is easy for developers to enable new functionalities and expand use cases.

The problem with the current setup is that there are no rules barring the creation of new token standards. A standard will depend on the creator’s innovativeness and whether it finds support from the community. This leeway, as it is emerging, can create a problem.

Because of the many token issuance standards, the analyst predicts user experience (UX) will rapidly deteriorate. Accordingly, based on this assessment, wallets, indexers, market makers, developers, and other ecosystem participants will face the brunt the most. 

This outlook is because BRC-20, Inscriptions, and Runes—once deployed—will become increasingly intertwined with a growing number of decentralized applications (dapps) and even layer-2 protocols tapping into Bitcoin’s superior security. It should be noted that Inscriptions and Runes are built by the same developer and even share the same code base. Runes will diverge from Inscriptions, aiming to create a template for issuing fungible tokens on Bitcoin.

Is This Diversification A Mark Of Strength?

Meanwhile, others, responding to the analyst, think multiple token standards on Bitcoin don’t lead to fragmentation. Instead, they are complementary, mirroring Ethereum’s ERC-20 and ERC-721 standards. 

Specifically, they see the current perceived fragmentation as a mark of strength. The lack of a central authority dictating standards allows users to choose standards that best suit their needs. Supporters argue that network effects will solve the issue by favoring the most widely adopted standard.

It remains to be seen how the network will evolve in the coming months and how user preferences will change. In 2023, the widespread adoption of Inscriptions pushed transaction fees higher, impacting user experience. 

Shiba Inu continues to struggle in the market, especially as Bitcoin continues to demonstrate muted price movements ahead of the halving. This market-wide downtrend continues to keep the prices of cryptocurrencies down. However, for the long term, the outlook for coins like Shiba Inu continues to be incredibly bullish, according to analysts.

Crypto Analyst Says Shiba Inu Is Now In Macro Third Wave

Crypto analyst Crypto Cipher took to X (formerly Twitter) to share his latest Shiba Inu analysis with the community. Cipher first caught the attention of the SHIB community with his analysis from May 2023, which revealed an accumulation phase for the meme coin, with recoveries following not long after.

This time around, the crypto analyst is calling out the bottom of the current trend, explaining that the Macro 3 wave is now in motion for the altcoin. This comes after the completion of both 1st and 2nd waves which player out between the end of 2023 and the start of 2024.

At this junction, the Shiba Inu price is more bearish than it is bullish as the analyst’s chart shows a possible fall from its current price point. This would put the SHIB price as low as $0.000015 before the price could recover again.

However, if the SHIB price is able to hold this level, then the price could bounce into the Macro 4th wave. “For continuation it must holds Gray Box,” Crypto Cipher stated in the post.

Possible Price Points For SHIB

The last of the Macro waves pointed out by the crypto analyst in the post are the 4th and 5th waves, both of which are expected to be even more bullish than the last. For example, the 4th wave which is expected to begin if the $0.000015 level holds has an upper end of $0.0001. This means that from the lows, it’ll be an almost 500% increase. While from the current 509 at the time of this writing, it would be a 3x increase.

Following the 4th wave, another correction is expected, where the SHIB price could fall as much as 50%. However, once the correction is over and the 5th wave continues, the upper end is placed as high as $0.00028, where the analyst expects the wave to end. At this upper end, investors could be looking at a 1,000% price increase.

As for the time frame for this, it is expected to happen over a long period of time, according to the chart. The 4th wave isn’t expected to begin until mid-2024, while the 5th wave is placed for some time in 2025, with a conclusion towards the middle of the year.

The cryptocurrency landscape is about to witness the emergence of a new Bitcoin-native digital commodity protocol that is expected to leave a lasting impact. Developed by Casey Rodamor, the Runes Protocol generates significant anticipation within the crypto community. 

However, DeFi researcher and market expert DeFi Ignas cautions investors to consider several bearish factors before succumbing to the fear of missing out (FOMO) as the protocol prepares for its launch on Friday.

Rising BTC Transaction Fees And NFT-Like Trading Mechanisms 

In a recent social media post on X (formerly Twitter), DeFi Ignas points out several reasons to be cautious for the time being. 

The researcher highlights the current enthusiasm surrounding the pre-rune token market. Tokens like Runestone, RSIC, and PUPS are already experiencing price surges and promising airdrops of the new Rune token to their holders. 

However, DeFi Ignas compares this market fervor to the non-fungible token (NFT) frenzy, cautioning that such excitement may cool off soon. Additionally, the researcher suggests that increasing Bitcoin transaction fees could pose challenges for small traders, potentially leading to disillusionment.

DeFi Ignas further notes that the Runes Protocol may not initially revolutionize the trading experience for BRC20 tokens, as the underlying trading mechanisms and user interfaces resemble those of NFTs. 

The researcher expresses skepticism about the Rune Protocol’s ability to offer superior swap mechanisms compared to BRC20 tokens. Furthermore, the impending influx of numerous Rune tokens hitting the market could dilute trader attention and decrease money inflows per token. 

DeFi Ignas highlights the unique nature of Rune 0 (UNCOMMON•GOODS), mintable for free over four years but limited to just one mint per transaction, suggesting that it may not be a straightforward investment opportunity.

Runes Protocol Set To Transcend Memecoin Status?

Regarding utility, DeFi Ignas predicts that Rune tokens will initially trade as meme coins, similar to BRC20 tokens. The initial excitement surrounding their novelty may fade, particularly if no Rune token manages to sustain its price surge and investors incur losses. 

Nonetheless, the researcher remains optimistic about the long-term prospects for the Runes Protocol, anticipating that true opportunities may arise once the initial hype cools down following the protocol’s launch.

DeFi Ignas explains that speculative narratives tend to emerge in waves, with the first wave driven by hype, often stemming from technological innovation or meme potential. 

Drawing parallels with previous examples like Friend tech, ERC404, and Telegram bots, the researcher suggests that meme tokens often experience short-lived success. At the same time, narratives rooted in technical advances have a higher chance of post-hype sustainability. 

The Ordinals protocol, introduced in December 2022 by Casey Rodamor, sparked the first wave, followed by subsequent surges in late 2023. The current fourth wave is represented by Runes Protocol, which DeFi Ignas believes will endure, spawning multiple waves in the future.

Ultimately, while short-term bearish factors warrant caution, the expert believes the Runes Protocol holds significant long-term potential. As the protocol launches, market participants are advised to assess its impact beyond initial hype, considering the technical advancements and unification it aims to bring to the Bitcoin DeFi industry.

Bitcoin is trading at $62,200, down a slight 0.6% in the past 24 hours. 

Featured image from Shutterstock, chart from TradingView.com

Technical analysis shows that Dogecoin (DOGE) may be set for an upside move after dropping to a major support level. This and other imminent bullish developments in the meme coin’s ecosystem suggest it may be the right time to invest in the crypto token. 

Time To Go Long On Dogecoin?

Crypto analyst BitLuxe revealed in an X (formerly Twitter) post that Dogecoin was trading near crucial support between $0.146 and $0.151. He then suggested that it may be time to go long on the foremost meme coin, although with a tight stop loss, possibly due to the uncertainty that is still in the market. 

BitLuxe advised traders to watch for bearish signs below this support zone. He added that the next support for Dogecoin is between $0.122 and $0.13. Meanwhile, for those who might long on DOGE, the crypto analyst mentioned that there is resistance between $0.168 and $0.173, which is something to note when setting a ‘take profit’ target. 

While also analyzing Dogecoin’s chart, crypto analyst Myles G remarked that the meme coin is about to experience a massive bounce-back. From the chart he shared, one could see that the analyst was hinting that DOGE would rise to as high as $0.23 soon enough. Myles G had also earlier predicted that the meme coin would rise to $0.26 on April 20, which happens to be DOGE Day. 

Meanwhile, in a more recent X post, Myles G again reaffirmed his bullish stance on Dogecoin, stating that there will be fireworks for the meme coin very soon. 

DOGE Still Has Bullish Momentum Ahead

Crypto analyst Yomi also recently laid out a bullish narrative for Dogecoin. The analyst mentioned that the meme coin is still “multiple weeks of upward price action away from achieving this bull market milestone.” He acknowledged that the current market downward trend has caused slight deviation but suggested another rally might be on the horizon. 

Crypto analyst Altcoin Sherpa is another person who is also bullish on Dogecoin’s future trajectory and believes that the meme coin still has enough bullish momentum ahead. In a recent X post, he urged crypto investors to buy Dogecoin if it drops to $0.107 or around that price range. “This is going to do stupid #s later this year,” the analyst claimed. 

Altcoin Sherpa previously mentioned that Dogecoin could do “something silly like go to $1 this cycle eventually.” He also once remarked that the foremost meme coin still has a lot of firepower and alluded to Elon Musk’s support for Dogecoin as one of the factors that could drive its price to $1. 

At the time of writing, Dogecoin is trading around $0.155, down over 1% in the last 24 hours, according to data from CoinMarketCap.

On-chain data shows that Bitcoin has flipped Ethereum in another metric, as the transaction fees paid on the BTC network are now higher than those paid on the ETH network.

Bitcoin Total Transaction Fees Is Now Higher Than Ethereum’s

As pointed out by analyst James Van Straten in a post on X, the Bitcoin transaction fees have once again flipped that of Ethereum. The “transaction fees” here naturally refer to the fees that all senders on any network have to attach their transfers as a reward for the validator who handles them.

The fees on the blockchain are generally related to the activity it’s serving at the moment. During times of high traffic, the mempool can become congested. As the validators only have a limited capacity to process transactions, transfers can remain stuck waiting for a while.

Investors who don’t want to wait simply slap higher-than-average fees on their transactions, so the network prioritizes them. In especially active periods, many senders can compete against each other in this manner, thus severely raising the network average.

The total transaction fees of the blockchain naturally shoot up at such times. On the other hand, periods of low activity generally have the validators receiving low transfer fees, as users have little incentive to go for any high amounts.

Now, here is a chart that shows how the total transaction fees (in USD) have compared between Bitcoin and Ethereum over the past year:

Ethereum has usually had a reputation for having higher transaction fees than Bitcoin, and as the above graph shows, that has indeed been the case for the majority of the past year.

It is quite remarkable that BTC has surpassed ETH in fees on several occasions in the last few months, though, as the latter network has rarely lost to the original cryptocurrency in this metric during the last five years.

From the chart, it’s evident that the highest disparity between the two blockchains in favor of Bitcoin came back between the end of 2023 and early 2024.

This increase in the BTC transaction fees was partly driven by the Inscriptions, a method of directly inscribing data onto a satoshi (sat), the smallest unit of Bitcoin.

Inscriptions are used in many different applications on the blockchain, like non-fungible tokens (NFTs). Transactions related to the Inscriptions are handled by the network like any other, so they naturally influence the economics related to transaction fees.

The Inscriptions had a big boom earlier, so Bitcoin sharply surpassed Ethereum in fees. Inscriptions have again been gaining traction recently, which is at least partly why the latest flip between the two has occurred.

It’s unclear whether this would sustain, though, as even the boom last time ended before too long and the fees dropped back to normal levels.

BTC Price

Bitcoin has been trying to mount recovery attempts in the last few days, but each has failed so far, as the cryptocurrency has returned to $62,400.

Ripple developers Aanchal Malhotra and Vito Tumas have introduced a ground-breaking proposal for a native lending protocol on the XRP Ledger (XRPL). If passed, this proposal is expected to expand the network’s decentralized finance (DeFi) capabilities and increase XRP’s utility.

What The Lending Protocol On XRP Ledger Is About

Ripple’s development arm, RippleX, elaborated in an X (formerly Twitter) post that the lending protocol will allow users to borrow and lend digital assets peer-to-peer (p2p) without the need for “unnecessary intermediaries.” The protocol will utilize a modular design that focuses on “flexibility and reusability.”

Furthermore, the modular design will introduce three specifications. The first is the XLS-64d, which will allow a single pseudo-account to be associated with “multiple ledger entries for tracking balances and issuing tokens.” The second is the XLS-65d, which “defines a new ‘Pool’ ledger entry for a single tokenized asset pool. 

XLS-66d is the third specification and will leverage the XLS-65d to manage the assets of Liquidity Providers (LPs). “It also introduces off-chain underwriting, on-chain agreements, and loan management.” RippleX further revealed. Regarding how the lending protocol will operate, LPs will deposit their crypto assets into a lending pool to earn interest. 

These lending pools will be managed by ‘Pool Delegates, ’ who will be charged with attracting capital from prospective lenders and providing loans to the borrowers. Pool Delegates will also be responsible for agreeing with the borrowers on the loan terms. This will be done off-chain, after which the agreement will be recorded on-chain. 

Lending Protocol Will Focus On Fixed-Term Loans

The proposed lending protocol will focus on fixed-term loans and will operate based on the pre-set terms regarding interest between the Pool Delegate and borrower. Interestingly, the need for collateral is eliminated due to the off-chain underwriting and risk management that the XLS-66d introduces. 

There will also be a first-loss protection scheme for lenders in case a default occurs. Pool Delegates can provide the first-loss capital to cover any potential default. Meanwhile, these loans will be managed through “a new ‘Loan’ ledger object.” 

The object will handle loan financing and withdrawals, payment amounts and schedules, and interest and principal payments. In the event of a default, the Loan ledger object will also handle this and spearhead the loan recovery. 

This development is undoubtedly bullish for the XRP ecosystem and could positively impact XRP’s price in the long run. It also adds to the several other bullish developments that have sprung up from the ecosystem lately. These include the proposed launch of a stablecoin on the XRPL and the newly launched Automated Market Maker (AMM). 

At the time of writing, XRP is trading at around $0.49, up over 1% in the last 24 hours according to data from CoinMarketCap.