Ripple has begun testing an XRP Ledger sidechain compatible with Ethereum smart contracts, marking the first step in a three-part process to introduce an EVM-compatible sidechain to the XRP Ledger mainnet. While it is not yet complete, it will enable developers to display smart contracts made for Ethereum on the XRP Ledger. The announcement comes as Ripple developers argue that using Federated sidechains will help preserve the XRP Ledger’s leanness and efficiency for payments. The second phase of the process is set to go live in early 2023, with the third and final phase slated for the second quarter of the same year.
WHOAAA! XRP gets a game-changing update and it’s not related to the lawsuit
The XRP Ledger recently received a potentially groundbreaking update, and it’s not even live for everyone yet! While the update is not yet available to everyone, the implications of what’s coming are mind-boggling. In this article, we will go over the new developments and explore what they mean for the XRP Ledger and the cryptocurrency space.
Federated side chains keep the main Ledger lean
The update concerns Federated side chains, which Ripple Labs has been talking about for a couple of months. The idea behind Federated side chains is that they can keep the main Ledger lean and efficient for payments. This is because they can provide additional functionalities via side chains, without cluttering up the main chain and making it more expensive or slower.
Smart contract functionality for the XRP Ledger
A couple of months ago, xrpl Labs announced the Hooks Amendment, which introduces smart contract functionality for the XRP Ledger. The amendment allows developers to influence transaction behavior and flow by embedding hooks (small pieces of code) that are defined in the XRP account. While the Hooks Amendment was a pretty open idea, there have been criticisms. Some enthusiasts thought it might be years before it was ready for a vote, let alone implementation.
XRP Ledger side chains with Ethereum compatibility
The recent update that has everyone so excited is the announcement that Ripple has begun testing XRP Ledger side chains with Ethereum smart contract compatibility. This means that smart contracts built on Ethereum can be leveraged on the XRP Ledger without requiring expensive or time-consuming adjustments. The Ethereum Virtual Machine (EVM) is the software that runs smart contracts on Ethereum, and an EVM-compatible side chain is now live on Ripple’s devnet.
Looking ahead, the second phase of the rollout is set to go live in early 2023. At this point, the EVM side chain will become permissionless, allowing anyone to join it. The third and final phase is slated for the second quarter of 2023, when Ripple will fully deploy the software. The goal is to have an EVM side chain connected to the XRP Ledger mainnet in 2023.
The potential of this update is huge
This update represents a significant step forward for the XRP Ledger ecosystem. It could usher in a new era of functionality and adoption, especially if Ripple manages to execute on its ambitious roadmap. This is the first time in a long while that XRP has received an update unrelated to the lawsuit. With the recent developments in Ripple’s legal case, this couldn’t have come at a better time.
The possibilities presented by this update are endless. It could lead to tens of millions of new users and developers hopping on to build on the XRP Ledger. Ultimately, it will allow for the creation of innovative financial products, including decentralized finance (DeFi) applications.
The new XRP Ledger update has the potential to change the game for XRP and the cryptocurrency space as a whole. While there could be things that go wrong, the update signals that Ripple is marching forward with its vision to create an interconnected financial world. If Ripple is successful, it could position itself as a major player in the cryptocurrency space. The smartest thing for investors to do is to stay tuned and watch the developments closely.