Why XRPL’s Latest Governance Vote Matters for Institutional DeFi

28-Jan-2026 TronWeekly
XRPL

XRPL Commons confirmed on January 27 via X post that it has voted in favor of two key XRP Ledger amendments after completing full end-to-end testing on Devnet. The group approved Permissioned Domains under XLS-80 and Permissioned DEXs under XLS-81, following a governance vote held on January 23, 2026. 

The decision marks a step toward enabling regulated financial activity on XRPL without changing its open and decentralized design.

The amendments aim to support institutions that require compliance controls, such as identity verification and restricted counterparty access. XRPL Commons said its vote was based on successful testing results and operational stability observed during Devnet deployment.

What Permissioned Domains and DEXs Add to XRPL

Permissioned Domains allow operators to define controlled environments on the XRP Ledger. Domain operators decide which credentials are valid, and accounts holding those credentials automatically gain access. 

This structure makes it possible to apply regulatory requirements like KYC checks while keeping the core ledger permissionless.

Permissioned DEXs extend the native XRP Ledger decentralized exchange by introducing domain-restricted order books. Only members within the same permissioned domain can trade with each other, ensuring all participants meet predefined compliance conditions.

The amendments introduce three offer types. Open offers follow existing XRP Ledger DEX behavior. Permissioned offers restrict trading to a single domain. Hybrid offers allow trades to match within a domain first before accessing open market liquidity. 

All functions rely on XLS-70 credentials, which provide an on-chain method for verifying account attributes such as compliance status.

Devnet Testing Results and Technical Findings

The complete lifecycle of the new features was manually tested in Devnet by XRPL Commons. This involved the creation and revocation of credentials, the administration of domains, and open, permissioned, and hybrid DEX trades.

The tests established that the membership of domains refreshed automatically whenever the credentials were altered and that the non-members were not allowed entry into the restricted order books.

Correctly, hybrid provides domain liquidity first and then resorts to the open DEX. The expired credentials were revoked automatically and rejected unauthorised trades as intended. Every XLS-70, XLS-80, and XLS-81 worked as specified.

An operational problem that was found during initial testing was the IOU configuration. To be able to use proper trade routing, issuers need to enable the DefaultRipple, users need to create trust lines, and issuers need to clear the NoRipple flag on the trust lines. 

Failure to do this step led to the failure of trades, and configuration accuracy is very important to institutions.

Why the Vote Matters for Institutional DeFi

XRPL Commons indicated that it was in favor of the amendments since it provides a sensible trade-off between compliance and decentralization.

Its features allow it to be used in the following use cases: stablecoin foreign exchange, payroll, international business settlements, and corporate treasury.

Although liquidity is confined to domains and no trade can cross permissioned environments, this was said to be a trade-off purposely made to satisfy regulatory expectations. Having the approval, XRP Ledger advances a step further towards being a regulation-ready settlement layer of on-chain finance.

Also Read: XRP Ledger Velocity Hits 2025 Peak As ETFs Near $1 Billion Inflows

Also read: US Marshals Probe Allegations of $40M Seized Crypto Theft
WHAT'S YOUR OPINION?
Related News