Ripple is making a bold move in the Decentralized Finance (DeFi) space with the announcement of an Ethereum Virtual Machine (EVM) sidechain on the XRP Ledger (XRPL). This sidechain, developed by Ripple partner Peersyst Technology, will reward validators with XRP tokens, marking the platform’s entry into the “staking wars” within DeFi.
XRP as Fuel for Ethereum Smart Contracts:
The key innovation lies in leveraging XRP as the native token for this EVM sidechain. Users can execute Ethereum smart contracts and dApps while holding XRP, eliminating the need to convert currencies. This move directly caters to the existing XRP community and offers a familiar environment for exploring DeFi options.
Staking Rewards in XRP:
The sidechain incentivizes participation by rewarding validators with XRP tokens. This differs from the main XRPL network, where transaction fees are burned. This shift has sparked both excitement and cautious optimism within the XRP community.
Crypto Eri, a popular XRP analyst, tweeted the news with enthusiasm:
“The New [Ripple] XRPL EVM Sidechain VALIDATORS will be paid in [XRP],” she posted, highlighting the potential increase in demand for the token.
However, concerns also surfaced regarding the long-term impact on XRP’s supply and potential inflation.
Unveiling the Potential Impact:
Ferran Prat Tió, CEO of Peersyst Technology, believes this sidechain will generate economic activity within the XRP ecosystem, attracting investments and driving demand for the token. However, he acknowledges the need for careful monitoring and adaptation as the project evolves.
