The XRP Ledger could soon close a major gap in its decentralized finance toolkit with a proposed amendment that would extend the network's automated market maker to support multiple swappable curve types, giving liquidity providers more efficient ways to deploy capital.
Market Context
XRPL has been building significant institutional tokenization volume, with over $3 billion in tokenized real-world assets currently sitting onchain. A Ripple-JPMorgan pilot earlier this month processed a tokenized U.S. Treasury redemption in under five seconds, showcasing the network's capability to handle institutional-grade transactions at speed.
Analysis
The draft amendment titled "AMM Swappable Curves" was filed on the XRPL standards repository Tuesday by core developers Denis Angell and Roman Thpt. It proposes adding three pluggable curve types: constant product, concentrated liquidity, and StableSwap. A fourth fully programmable Smart AMM curve type is reserved for a follow-up specification.
The current AMM setup spreads liquidity uniformly across every possible price point. While this works adequately for volatile token pairs, it burns capital when deployed for stablecoin pairs or correlated assets that trade in tight ranges. Concentrated liquidity allows liquidity providers to target narrow bands where most trades actually occur, producing far more usable depth per dollar deposited.
StableSwap is purpose-built for assets that trade near 1:1 parity, such as dollar-pegged stablecoins or wrapped representations of the same underlying asset. According to data cited in the proposal, concentrated liquidity has become the standard for capital-efficient AMMs across major DeFi ecosystems, with approximately 60% of current AMM volume running through some version of it.
The amendment keeps existing pools untouched. Pools created before new curves activate stay on the constant product model with no migration required. Pool creators selecting from the new menu would choose their curve type at creation time, with that selection locked in for the pool's lifetime.
XRP traded at $1.34 during U.S. morning hours Tuesday. Whether this upgrade lands in time to compound the institutional narrative depends on the amendment process, which can stretch for months and carries no guarantee of passage.
Key Numbers
- $3 billion+ in tokenized real-world assets currently on XRPL
- ~60% of AMM volume now runs through some version of concentrated liquidity
- $1.34 price of XRP during U.S. morning hours Tuesday
- Under 5 seconds for Ripple-JPMorgan tokenized Treasury redemption processing time
What to Watch
The amendment remains in draft status and would require a separate vote before activation, with the process potentially taking months. XRPL validators and node operators should also monitor Wednesday's fixCleanup3_1_3 upgrade, which cleans up expired NFT offers and requires software updates.