Ripple is improving the XRP Ledger by adding Ethereum-compatible smart contracts via a new sidechain. This will boost its capabilities beyond simple transactions to accommodate more complicated applications such as decentralized exchanges and token issuance.
This development incorporates the use of the Axelar network for cross-chain token transfers to promote more interoperability and developer involvement. On this sidechain, wrapped XRP, also known as eXRP, acts as the primary currency.
In a move that consolidates the support base of the rather similar XRP coin, Ripple is to introduce sidechain networks that will enable Ethereum-compatible smart contracts on the XRP Ledger.
The CEO discussed the divergence of the reactions of members of the digital asset community regarding Ripple’s statement that it will make another positive change in terms of customization for the ‘builders, entrepreneurs and users’ in the X post by integrating the smart contract capability into the XRP ledger.
Change In XRP Ecosystem Raises Concerns
The digital asset community raised concerns about whether Ripple is the only driving force in the XRP ecosystem and whether they will have a voice. Schwartz stated that Ripple plans to keep the XRP Ledger the same.
Smart contracts are programs that automate the processes necessary in a blockchain transaction to enable functionality beyond simple transactions, such as token issuance, trade processing, and the creation of decentralized exchanges and financial apps.
“Progress towards smart contract functionality is already underway in the XRP Ledger ecosystem with the XRPL EVM sidechain,” Ripple said in a release Monday. Additionally, it was mentioned,
“This sidechain will add EVM compatibility to the XRP community, where developers can use the existing tools and coding languages to expand the appeal of the XRP Ledger to developers across the world.”
XRP Ledger is a public blockchain platform that utilizes XRP tokens to carry out financial transactions. In 2022, testing of the smart contract deployment based on Ethereum on the XRPL was already possible.
Ethereum Virtual Machine (EVM) is a tool responsible for executing smart contracts on the Ethereum platform. A sidechain is essentially an additional blockchain built beside the main chain, in this case, the XRP ledger.
Enhancing The Programmability Of The Network
With the introduction of native smart contract capabilities on the XRP Ledger (currently in the research phase) and the upcoming debut of the Ethereum Virtual Machine (EVM) sidechain (expected to go live in the next few months), Ripple aims to enhance the programmability of the blockchain network.
According to Ripple CTO, instead of presenting a “fully baked” proposal to the crypto sector and the XRP community, Ripple has been transparent with its plans. The American fintech firm’s goal is to remain transparent and inform its community and shareholders where it plans to allocate resources and has also outlined its priorities.
Schwartz explained the abrupt shift in the company’s goals, stating that Ripple had originally thought that XRPL would be drastically changed by the main net’s ability to be programmed. As a result, the business had to develop the EVM sidechain.
But after hearing from several people and receiving feedback from the crypto industry, Schwartz concluded that “programmability makes sense for Mainnet much earlier.”
