A number of changes on the XRP ledger could be looming, including one that could allow the creation of tokens backed by some assets.
Ripple’s Chief Technology Officer, David Schwartz, recently revealed that they are working on “very exciting” features to improve the XRP ledger in terms of functionality, subsequently expanding XRP’s use cases.
Stablecoins And Other Asset-Backed Tokens On XRP Ledger
In a recent episode of Ripple Drop, Schwartz spoke about how the XRP Ledger has evolved over the years. He noted that he started working on the XRPL towards the end of 2011. Since then, the ledger has experienced so many changes.
In those early days, all they were able to do was conduct fast transactions on a decentralized ledger. Schwartz and the team later realized that “the properties of the algorithms we’d developed allowed us to do things like a decentralized exchange.” Now, the ledger is powering a global payments network worth billions of dollars.
He said that he had suggested a number of changes for the XRP ledger including core consensus improvements. He pointed out that although Proof-of-Work (PoW) works fine, it is basically “a technological dead-end”. This is especially because there haven’t been any notable innovations in it.
Schwartz has also suggested new features that will allow users to launch stablecoins on the XRP ledger. But, he did not touch on the specifics of these new features. All he said was that these features would enable the development of asset-backed tokens on XRP ledger.
“Stablecoins are the obvious use case, but it’s not just stablecoins. It’s essentially assets pegged to some external value.”
He noted that features similar to this have been developed on other systems. What makes this one unique is the fact that the “liquidity will be guaranteed by the ledger mechanics.”
This is not the first time Schwartz is speaking about possible stablecoins on the XRPL. In early October last year, the CTO explained about collateralized stablecoins with a backing asset, in this case, XRP. He opined that the stablecoins would be perfectly liquid to XRP at face value and they could be pegged to anything including stocks and precious metals.
The timeline for the implementation of these new features is still unclear. What remains certain, however, is the fact that stablecoins built on the XRP ledger would create more demand for XRP because it would be used as collateral for the stablecoins.
XRP Could Recover To $0.30 If The Bulls Reclaim $0.245
XRP and the crypto markets in general faced a serious downturn earlier this week. The bears are still in the driver’s seat as the coins shed more value. XRP is trading at $0.234495 at press time, with 3.88% losses on the 24-hour adjusted timeframe.
However, analyst Crypto Michael believes it has the potential to recover back to $0.30 but it needs to first reclaim $0.245.