Ripple Unveils Automated Market Maker for XRP Mainnet

Ripple's Chief Technology Officer, David Schwartz, announced the launch of the XLS-30 automated market maker (AMM) on XRP mainnet. The AMM aims to enhance liquidity and reduce slippage for traders on the XRP Ledger. However, Schwartz cautions users to exercise caution when venturing into trading via the AMM, emphasizing the importance of understanding the potential risks associated with single-sided deposits and imbalanced AMMs.

Ripple Launches XLS-30 Automated Market Maker on XRP Mainnet

By The Wall Street Journal

March 23, 2024

Ripple's Chief Technology Officer, David Schwartz, announced the deployment of the XLS-30 automated market maker (AMM) on the XRP mainnet via Twitter on March 22, 2024. This marks a significant milestone for the XRP Ledger (XRPL), introducing a non-custodial AMM that is expected to enhance liquidity and improve trading experiences for users.

AMM Integration on XRPL

The XLS-30 AMM is specifically designed for the XRPL's decentralized exchange (DEX), enabling liquidity providers to earn returns and traders to benefit from reduced slippage when transacting in a wide range of tokens. Developers can now leverage XLS-30 to integrate with the AMM, creating custom interfaces for trading and liquidity provision.

Caution for Users

While the launch of the AMM is a positive development, Schwartz emphasized the importance of caution for users engaging in trading via the new platform. He cautioned against making one-sided payments into AMMs with insufficient liquidity, as this could result in losses during the deposit process.

"If you make a single-sided deposit into an AMM that doesn't have significantly more liquidity than the size of your deposit, you will take a loss in the deposit process," Schwartz tweeted. "Whatever tool you're using typically warns you about this loss as a report of 'slippage.'"

Traders experiencing high slippage during deposits are advised to consider alternative options besides single-sided deposits. Schwartz also highlighted the potential for losses in deposits made into an AMM that is not balanced prior to the investment.

Rare Occurrences

However, Schwartz reassured users that such instances should be infrequent, as prolonged imbalance within an AMM would indicate missed profit opportunities for all participants.

Future Milestones

The deployment of the XLS-30 AMM is seen as an initial step in a longer roadmap for growth and development on the XRPL. Schwartz expressed excitement about the journey ahead and encouraged collaboration among users, traders, developers, market makers, and others in the XRPL ecosystem.

RippleX Developers Discuss Deployment

In a recent blog post, RippleX developers provided insights into the deployment of the XLS-30 AMM on the XRPL. They highlighted the potential benefits of the AMM for liquidity providers and traders, as well as the opportunities for developers to create innovative applications and services.

Conclusion

The launch of the XLS-30 AMM on the XRP mainnet is a significant development that is expected to enhance the liquidity and trading capabilities of the XRPL. While caution is advised for users navigating the AMM landscape, the potential benefits for liquidity providers, traders, and developers make this deployment a promising step forward for the XRPL ecosystem.