The New AMMClawback Amendment on XRP Ledger
The XRP Ledger (XRPL) recently implemented the AMMClawback amendment, introducing a new layer of regulatory compliance and asset control within its Automated Market Maker (AMM) system. On Jan. 30, XRPscan, a blockchain explorer for XRPL, confirmed that the amendment is now live after a 14-day activation period.
Understanding the AMMClawback Functionality
- The AMMClawback feature allows issuers to claw back tokens deposited into an AMM if clawback is enabled on the token.
- This update also prevents frozen tokens from entering liquidity pools, reducing risks related to unauthorized transactions.
- Issuers now have greater oversight over tokens with clawback permissions operating within XRPL’s native AMM.
Implications of the Amendment on XRP Ledger
XRP advocate Luke Thomas highlighted the impact of the amendment, stating that token issuers can now reclaim assets in cases of fraud, regulatory concerns, or legal disputes. This upgrade aligns XRPL with compliance-focused networks like Stellar (XLM), Hedera (HBAR), and Algorand (ALGO), making it more attractive to institutional investors and regulated financial entities.
Emi Yoshikawa, Ripple’s former VP, pointed out that the amendment has significant implications for Ripple’s stablecoin, RLUSD. With clawback functionality, RLUSD can now be directly exchanged on XRPL’s decentralized exchange (DEX), enhancing liquidity and trading flexibility.
On-chain data suggests that RLUSD is the fastest-growing pool in terms of unique users on the XRPL, exceeding $500,000 in less than 24 hours of launch. Artur Kirjakulov, CEO of XRPL-focused analytical platform XPmarkets, mentioned that RLUSD is now the 9th largest AMM pool on XRPL.