Ripple Ready to Publish Proposal for Federation Sidechain

 Ripple developers have engaged with feedback and suggestions that they are extending XRP Ledger, or XRPL, to integrate functionality such as smart contracts.



The latter has been a key feature of the booming decentralized finance space, but Ripple's creators claim that a different solution is better for payments-focused XRPL.

These solutions come in the form of what they call a “federation side chain” i.e. parallel ledgers that can support developer-specific experiments and interests, whether for DeFi or other use cases.

Using sidechains can make mainstream XRPL lean and efficient while extending the functionality of the wider XRP ecosystem by offering interoperability for native smart contracts and other features.

To facilitate this interoperability, the creators of Ripple proposed a software “federator”, which is connected at one end to the XRPL ainnet, and on the other, to one or more sidechains. Each of them function as their own blockchain but they use XRP as their main asset; moreover, the federated system supports XRP transfer and token issue between them and the main ledger.

Validators operating at least one sidechain will be eligible to run the federator software. To integrate this new software, Ripple says it only needed to make “two trivial changes” to the operation of the XRPL network.

New features in the XRPL server software will allow it to operate in a side chain but these features will not be enabled on the mainnet itself. Further outlining the federation system, Ripple chief technology officer David Schwartz wrote:

“Each sidechain will have a 'trust' account on the XRPL Mainnet. This account can store assets in XRPL on behalf of the sidechain user. The account will use a multisign or threshold key with the signer as the sidechain validator. Each sidechain validator operator registers a signing key that signs transactions in XRPL; thus, sidechain validators can collectively make transactions to manage sidechain Mainnet accounts.”

Each sidechain can choose to use XRP as its original asset or have its own new native asset. In the former case, the sidechain account on the mainnet will contain the total XRP holdings that are trusted to be used in the sidechain. In the latter, the mainnet sidechain account can be used to issue new native assets on the XRPL Mainnet.

Schwartz said that the advantages of a federated system are its low-risk approach, capacity for horizontal scaling, simple support for new blockchain experiments and a long-term vision that can accommodate evolving devices and continuous feedback on the development of new sidechains.

As previously reported, sidechains have become a popular approach for blockchain developers to try out new solutions to solve scaling problems and integrate new functionality into established blockchain ecosystems like Ethereum.

 

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