XRP Ledger May Shift Toward Reward-Based Participation as Ripple Considers Staking Features for Long-Term Users

Ripple Considers Bringing Staking To XRP Ledger To Strengthen Security And Incentives

Ripple is exploring the possibility of introducing native staking to the XRP Ledger (XRPL), a move that could expand the blockchain’s role in decentralized finance and reshape participation incentives for validators and token holders.

The discussion gained momentum after J. Ayo Akinyele, head of engineering at RippleX, highlighted the potential benefits of staking in a recent blog post.

Could Staking Encourage Long-Term Participation On XRPL

Akinyele explained that staking “can encourage long-term participation and provide rewards to participants who help maintain consensus, which could strengthen network security.”

He noted that enabling staking would require redesigning the ledger’s core structures, including the creation of a source for staking rewards and a fair distribution method.

Currently, XRPL maintains a deflationary model by burning transaction fees, and redirecting these as rewards would involve significant architectural changes.

The XRP Ledger was originally designed for efficient cross-border payments and value transfer, its primary use case for years.

With XRP gaining adoption in corporate treasuries and exchange-traded products, Ripple is exploring whether staking could help maintain the network’s competitive edge while expanding utility beyond traditional payments.

How Would Staking Work On XRPL

David Schwartz, Ripple’s chief technology officer, outlined two conceptual approaches to integrate staking.

The first proposes a dual-layer consensus model.

An “inner” layer of approximately 16 validators, selected by the broader validator set based on stake, would manage ledger advancement using staking and slashing mechanisms to prevent protocol violations.

The “outer” layer, composed of existing validators, would oversee governance, amendments, and fees.

The second approach would maintain XRPL’s current consensus system while redirecting transaction fees to fund zero-knowledge proof (ZKP) verification.

ZKPs allow participants to validate actions without revealing sensitive information, offering a trust-minimised method of verification.

Schwartz emphasised that while both models are “technically promising,” they are “not practical” in the near term due to high complexity, engineering effort, and potential risks.

Ripple Engages With US Fed Proposal To Expand Crypto Access

Ripple’s exploration of staking coincides with recent developments in the US regulatory environment.

Earlier this month, Federal Reserve Governor Christopher Waller proposed allowing crypto firms access to “skinny” Fed accounts, enabling direct interaction with the central bank’s payment systems.

Stu Alderoty, Ripple’s chief legal officer, described the proposal as potentially transformative, saying it could speed up settlement, lower costs, and support Ripple’s RLUSD stablecoin in a competitive market dominated by Tether and Circle.

Alderoty noted that direct access to the Fed would enhance stability and redeemability for digital assets, reducing reliance on traditional banks that often hesitate to service crypto firms.

Ripple, which previously applied for a Fed master account for RLUSD, views the proposal as a significant opportunity to integrate crypto more deeply into mainstream financial infrastructure.

Staking Could Reshape XRP’s Role In DeFi

The possibility of staking on XRPL raises questions about the ledger’s foundational design, particularly its Proof of Association model, which prioritises trust and reliability over economic incentives.

Akinyele and Schwartz emphasised that while the concept could boost security and long-term participation, any implementation would require careful consideration of protocol principles and network stability.

Internal discussions at Ripple continue as the team weighs whether staking could enhance XRPL’s utility without compromising its existing consensus system.

The dialogue reflects a broader effort to position XRP within the growing DeFi ecosystem while preserving the network’s efficiency and trust-based architecture.