Is XRP Becoming A Privacy Coin? Ripple’s New Proposal Says Yes—And No
Ripple’s developer arm has floated a blueprint to convey privacy-coin-like performance to the XRP Ledger—with out abandoning the community’s long-standing emphasis on public provide integrity and compliance tooling.
In a brand new XRP Ledger Standards (XRPLF) dialogue opened on September 13, Ripple engineers Murat Cenk and Aanchal Malhotra suggest “Confidential Multi-Purpose Tokens (MPTs),” an modification that might encrypt balances and switch quantities utilizing EC-ElGamal and zero-knowledge proofs, whereas preserving the accounting semantics of XRPL’s present MPT framework. RippleX subsequently highlighted the proposal on X, drawing mainstream consideration to what may very well be essentially the most consequential privateness addition but thought of for XRPL.
Is XRP Becoming A Privacy Coin?
At its core, the draft introduces confidentiality on the token layer with out obscuring mixture provide.
Confidential MPTs present confidential transfers and balances utilizing EC-ElGamal encryption and Zero-Knowledge Proofs (ZKPs), whereas preserving XLS-33 semantics,” the authors write. Crucially, they stress that “Public auditability” stays intact as a result of issuance limits proceed to be enforced by the community’s present invariant—OutstandingAmount by no means exceeding MaxAmount—so validators can confirm that no new tokens are silently minted even when particular person balances are encrypted.
The design leans on a sensible architectural compromise. Instead of redefining provide math for a personal system, issuers would keep a delegated “second account” that the ledger treats like another holder. Public provide metrics, together with OutstandingAmount, then account for each public and confidential balances, with a brand new ConfidentialOutstandingAmount discipline monitoring the personal portion. This lets validators implement the identical XLS-33 rule set they already perceive, whereas transactions themselves depend on equality proofs and vary proofs to make sure spends are legitimate with out revealing quantities.
The proposal is express in regards to the “twist” that differentiates it from pure privateness chains comparable to Monero or Zcash: selective disclosure and issuer controls are inbuilt. The spec outlines two auditor fashions—an on-chain, trust-minimized strategy that helps pre-defined auditors and later additions through re-encryption, and an easier issuer-controlled “view key” possibility. It additionally proposes issuer-only freeze and clawback capabilities over confidential balances, framed as compliance instruments relatively than discretionary surveillance. In the authors’ phrases, the system allows “versatile auditability” whereas preserving personal balances “encrypted below the holder’s key,” with optionally available auditor copies of the identical ciphertext verifiably sure through ZK equality proofs.
To make the stream dependable at scale, the draft adopts a split-balance mannequin that separates a holder’s encrypted funds right into a spendable “Spending” steadiness and an “Inbox” for brand spanking new incoming transfers. A light-weight merge operation prevents “stale proof” failures that may happen when a brand new receipt lands whereas a person is making ready a proof for an outgoing switch. That operational element, commonplace in high-throughput confidential techniques, suggests the authors are conscious of UX and wallet-developer realities, not simply cryptographic magnificence.
If superior, the change would arrive as an XRPL modification and have to clear the ledger’s formal governance hurdle: greater than 80% validator approval sustained for 2 weeks earlier than activation on mainnet. Nothing within the dialogue implies a reside vote but; the standing is “Discussion,” and any manufacturing path would first require code touchdown in a secure server launch.
Context issues right here. The multi-purpose token normal (XLS-33, “MPT”) already equips XRPL with a extra compact, compliance-aware fungible token primitive than legacy trustlines, together with allow-lists, freeze and clawback, and on-chain metadata. Confidential MPTs don’t exchange that mannequin; they lengthen it. The ledger would proceed to show provide caps and implement invariants at the same time as per-account balances develop into opaque, aiming squarely at institutional tokenization the place privateness, auditability, and coverage controls should coexist.
Technically—and politically—the framing invitations the plain query within the headline. Is XRP turning into a privateness coin? The sincere reply is ambivalent by design. On one hand, balances and quantities could be encrypted end-to-end, with ZKPs securing the stream—indistinguishable at a look from what privateness cash promise. On the opposite hand, the draft hardwires audit channels and issuer recourse that privacy-maximalist communities sometimes reject, and it preserves validator-enforced provide checks that make “stealth inflation” mathematically inconceivable. That is the “Yes—and No” in a nutshell.
At press time, XRP traded at $3.01.