Expert WrathofKahneman says XLS-80 could give XRP Ledger an edge over Ethereum by embedding compliance into the protocol to boost adoption.
The debate between XRPL and Ethereum has been reignited in the wake of Apex 2025 by the concept of permissioned domains.
Expert WrathofKahneman has provided insight into how XLS-80 could provide XRP Ledger with a competitive advantage.
Is it possible for XRPL’s XLS-80 to surpass Ethereum’s off-chain compliance methods?
According To Expert, Success Of XRPL Over Ethereum Is Due To XLS-80
WrathofKahneman, an expert in XRP, provides a glimpse into the implications of XRP Ledger’s XLS-80 permissioned domains in a succession of X posts.
He believes that XLS-80 will give XRPL an advantage over Ethereum in institutional adoption, regulatory compliance, and beyond.
Institutions seeking to operate in a regulated environment may benefit from this innovative approach, which is purported to provide a more efficient and streamlined solution.
Consequently, it distinguishes XRP from Ethereum, which has the potential to reduce friction for organizations and facilitate increased adoption.
The expert stated,
XLS-80 would embed compliance directly into the protocol. In contrast, Ethereum handles compliance off-chain: permissioned DeFi apps like Aave Arc require separate contracts or private pools gated by external KYC lists. By remaining native to the XRPL it could reduce the friction for orgs to operate there, too.
The debate between XRPL and Ethereum has recently acquired momentum as experts evaluate the advantages and disadvantages of these two prominent blockchain platforms.
The most recent discussion follows closely on the heels of Ripple CTO David Schwartz’s proposal to enhance the XRP Ledger’s transaction fee management, which drew comparisons to Ethereum.
WrathofKahneman also emphasized the advantages of XLS-80, such as a permissioned DEX, institutional adoption, native compliance, Ripple’s market maker role, and XRPL’s utility growth.
The XRPL vs Ethereum debate is gathering momentum in anticipation of the XRP Ledger’s June upgrade to version 2.5.0.
As previously reported by CoinGape, this enhancement has the potential to provide XRPL with a competitive advantage over Ethereum and Solana.
XLS-80’s Effect On XRPL AMM? David Schwartz Describes
Furthermore, WrathofKahneman observed that the permissioned domains could affect XRPL’s AMM (Automated Market Maker).
According to the expert, XLS-80 enables regulated entities to establish compliant liquidity pools with permissioned LPs.
Furthermore, integrating these domains with future XRPL extensions could enhance the ledger’s capabilities.
Additionally, he references the XRPL dUNL validator VET’s explanation of the potential applications of permissioned domains. According to VET,
That’s totally doable! More so, every extension can be used that way e.g smart escrows can already check for credentials and more. A use case could be in the lending protocol, whereby you get better rates if you own certain credentials and if not you still get a rate quoted.
Ripple CTO David Schwartz comprehensively explains “what it is supposed to mean to permission the AMM” in response to the threads.
Permissioned AMMs on the XRP Ledger would limit liquidity pool access to authorized users within a domain, as per David Schwartz.
Users who were removed would be required to trade their LP tokens on the open market, as their direct redemption rights would be revoked.
Schwartz emphasized that LP tokens are domain-specific claims, not ownership of the ledger’s liquidity.
Additionally, he stated,
(There’s no reason for the LP tokens themselves to be in the domain. They’re issued and managed by the XRP ledger itself. There could be permissioned order books for them, but they can always be bought/sold for XRP on the open DEX.)
