Ripple is exploring the possibility of introducing a native staking feature to the XRP Ledger (XRPL) to enhance its security and utility. The potential overhaul aims to expand XRP’s capabilities within the world of Decentralized Finance (DeFi), an ecosystem where the ledger was originally designed primarily for efficient cross-border payments.

Adding a staking mechanism, however, presents a fundamental challenge to the XRPL’s core design. The ledger currently operates on a Proof of Association consensus model, which prioritizes trust and network stability over the direct financial incentives typical of staking protocols.

Two Conceptual Models Proposed

Despite these challenges, Ripple’s Chief Technology Officer, David Schwartz, has outlined two conceptual ideas for integrating staking. The first proposal involves a two-layer consensus model. This system would feature an “inner” layer of approximately 16 validators selected based on their staked assets. This group would manage ledger operations, using staking and slashing mechanisms to penalize malicious behavior like double signing.

An “outer” layer, consisting of the current validators, would operate without a staking component. Its role would be to oversee the inner layer, manage network amendments, and set transaction fees. The second concept would keep the existing consensus structure but would use fees to power zero-knowledge proofs—a cryptographic method for verifying information without revealing underlying data.

While acknowledging the technical promise of these ideas, Schwartz tempered expectations by stating they are “not practical” for near-term implementation due to their complexity, risk, and the significant effort required.

RLUSD Stablecoin to Settle Mastercard Transactions

In a separate development, Ripple announced a partnership with Mastercard, WebBank, and Gemini to explore using its dollar-backed stablecoin, RLUSD, for a new payments pilot. The collaboration aims to settle fiat credit card transactions on the XRP Ledger.

The initiative, which is pending regulatory approvals, will focus on transactions made with the Gemini Credit Card, which is issued by WebBank. The partners plan to begin onboarding for RLUSD in the coming months before moving toward integration with Mastercard and WebBank’s settlement processes.