Ripple explores introducing staking functionality to the XRP ledger ( XRPL ), expanding Decentralized Finance potential.

Ripple is considering whether to introduce staking functionality to the XRP ledger (XRPL). This move will further integrate this decade-old blockchain into the rapidly evolving Decentralized Finance (DeFi) sector.

RippleX Engineering Lead J. Ayo Akinyele published a blog post discussing how staking can extend the utility of XRP and reshape the incentive mechanisms for validators and token holders, sparking this discussion.

Akinyele stated that with the launch of new features on XRPL, this idea naturally emerged. He believes that staking can encourage “long-term participation” and enhance network security by rewarding those who help maintain consensus.

However, enabling the staking feature requires a fundamental transformation of the ledger architecture. XRPL currently maintains a deflationary supply by destroying transaction fees, while redistributing them as rewards would require a reconstruction of the core system. The XRP ledger was originally designed for efficient value transfer, particularly for cross-border payments, which has been its primary use over the years.

As XRP becomes increasingly popular in corporate treasury management and appears in exchange-traded products, Ripple is considering how to leverage new features such as stake to maintain the competitiveness of its network.

However, the shift of XRPL towards a rewards-driven system has raised questions about its fundamental principles, including its Proof of Association model, which prioritizes trust over economic incentives.

Ripple's Chief Technology Officer David Schwartz outlined two theoretical paths for introducing staking into XRPL. The first is a dual-layer consensus model, which includes an incentivized “inner layer” consisting of about 16 validators, selected by a broader group of validators based on their staking situation. This inner layer will advance ledger updates using penalty and staking mechanisms, while the “outer layer” is responsible for maintaining governance and monitoring systems.

The second proposal will retain the current consensus mechanism of XRPL while utilizing transaction fees to fund Zero-Knowledge Proof (ZKP) verification. Zero-Knowledge Proof (ZKP) allows participants to prove facts without revealing information, thereby achieving a minimal trust participation verification method.

Schwartz reminds that, despite the promising prospects of these two concepts, there is still a long way to go before realization. The required engineering investment, risks, and structural changes mean that the stake function is unlikely to be launched on XRPL anytime soon. (Cryptonews)