Ripple outlines 2025 roadmap for institutional DeFi on XRP Ledger

Ripple Labs has released its 2025 roadmap for building an institutional decentralised finance (DeFi) ecosystem on the XRP Ledger (XRPL).

The focus is on creating a secure and scalable Layer-1 blockchain for financial institutions operating in regulated environments.

Key elements include a permissioned decentralised exchange (DEX), credit-based DeFi lending protocol, and a new Multi-Purpose Token (MPT) standard.

Ripple (CRYPTO:XRP) CTO David Schwartz described the roadmap as "pretty great," emphasising its clear direction.

The initiatives aim to leverage XRPL's decentralised identifiers to integrate compliance checks into smart contracts.

XRP Ledger's roadmap builds upon existing infrastructure, including price oracles and an automated market maker (AMM).

The roadmap is designed to enable institutions to meet regulatory requirements, offer advanced lending options, and provide developers with greater flexibility in building and deploying applications.

XRPL will enhance its identity stack, adding Credentials as a lightweight feature to the existing decentralised identity (DID) standard.

These features aim to establish environments that require specific credentials, enabling institutions to engage in decentralised trading while adhering to regulations like anti-money laundering (AML) and know-your-customer (KYC) rules.

The Multi-Purpose Token (MPT) standard aims to bridge the gap between fungible and non-fungible tokens (NFTs), creating semi-fungible tokens.

Ripple hopes that leaning into institutional DeFi, including real-world assets (RWAs), will accelerate network growth.

Although XRP's market capitalisation stands at approximately $128 billion, activity on XRP Ledger lags behind rival chains, with a total value locked (TVL) of roughly $80 million, compared to Ethereum’s (CRYPTO:ETH) more than $50 billion.

At the time of reporting, the XRP (XRP) price was $2.20.