Ripple researchers have proposed a new protocol to enable privacy-preserving transfers on the XRP Ledger, targeting institutional adoption and regulated use cases.
The framework introduces Confidential Transfers for Multi-Purpose Tokens, extending the XLS-33 token standard to hide balances while maintaining transaction validity.
“To accommodate regulatory and institutional requirements, Confidential MPTs provide cryptographic auditability through an on-chain selective-disclosure model,”
The research paper states.
The system replaces visible account balances with encrypted data using EC-ElGamal cryptography, while zero-knowledge proofs ensure transactions remain verifiable without revealing sensitive information.
Issuer controls such as freezing and clawbacks remain intact, allowing compliance with regulatory requirements while adding privacy features.
The proposal comes as regulatory attitudes toward blockchain privacy evolve, with a recent US Treasury report recognising legitimate use cases for privacy tools in digital asset transactions.
The development aligns with Ripple’s broader push to enhance XRPL infrastructure, including recent efforts to integrate AI-driven security measures into the network.
At the time of reporting, XRP price was $1.35.