The XRP Ledger has now inched closer to launching its long-awaited native lending infrastructure. The new LendingProtocolV1_1 amendment is now open for validator voting.
RippleX announced on Sept. 30 that validators can now evaluate and vote on LendingProtocolV1_1.
The upgrade comes with two significant changes to the XRPL lending architecture: closed-ended lending vaults and cash-basis accounting.
The amendment extends two other proposed pieces of XRPL infrastructure (LendingProtocol and SingleAssetVault).
According to RippleX, LendingProtocolV1_1 must activate alongside the original LendingProtocol and SingleAssetVault amendments.
The amendment changes how that pooled capital can be used for lending.
It was included in XRP Ledger server version 3.4.0, released on Sept. 16. The release formally introduced LendingProtocolV1_1 to ‘xrpld.’
Opening validator voting is not the same as activation.
A proposed change must receive support from more than 80% of trusted validators. Furthermore, it must maintain that level of support for two weeks. If support falls back to 80% or below during that period, the two-week countdown resets.
Closed-ended vaults
LendingProtocolV1_1 has introduced the ability to create a second type of Single Asset Vault.
Single Asset Vaults pool one type of asset from multiple depositors and make that capital available to another protocol. A vault can hold XRP, a trust line-issued token or a Multi-Purpose Token.
An open-ended vault works like an investment pool that remains continuously accessible. Users can deposit capital and receive shares based on the prevailing price per share.
Approving V1_1 alone would not suddenly create a functioning XRPL lending market.
RippleX says all three amendments (SingleAssetVault, LendingProtocol and LendingProtocolV1_1) are required for operational lending.
The Sept. 30 vote should be viewed as a procedural milestone.
