Yoshitaka Kitao, CEO of Japan-based financial giant SBI Group, has highlighted a major development on the XRP Ledger (XRPL). In a recent tweet, Kitao pointed to Ripple’s launch of a Permissioned Decentralized Exchange (DEX), describing it as a significant advancement for the ecosystem. This move marks a critical step toward enabling compliant decentralized finance (DeFi) for institutions.
Earlier this year, Ripple quietly rolled out the Permissioned DEX on the XRP Ledger. According to Ripple’s press release, this new system allows regulated financial entities to engage in trading activities without sacrificing decentralization, scalability, or compliance. By introducing this DEX, Ripple aims to give institutions the ability to move or trade assets on XRPL’s native DEX infrastructure while still adhering to financial regulations.
How the Permissioned DEX Works
The permissioned DEX operates by enforcing a fixed set of rules and limiting participation to approved entities. These entities must belong to a “Permissioned Domain,” which acts as an allowlist. Only allowlisted accounts can access specific order books and trade within the defined permissioned environment. Notably, app developers can still create order books for permissionless assets like XRP, stablecoins, or wrapped cryptocurrencies, but only authorized users can interact with them.
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Additionally, XRPL can host multiple permissioned DEXes at the same time. Each DEX links to a unique permissioned domain and operates its own isolated trading environment. Trades within these DEXes remain confined to other offers made in the same domain, ensuring strict compliance and participant control. Ripple emphasizes that each DEX can support unlimited trading pairs, further expanding institutional possibilities.
Unlocking Real-World Use Cases
Ripple sees this innovation as the logical next step for XRPL’s evolution. The company believes the Permissioned DEX resolves a key challenge integrating regulatory compliance without compromising the fundamental benefits of decentralization, low fees, and user autonomy.
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As a result, financial institutions now have the green light to begin trading on the XRPL DEX in a compliant, scalable, and low-cost environment. The platform enables a range of institutional-grade financial operations, including stablecoin-to-fiat FX swaps, payroll distributions, cross-border business payments, and treasury management.
By combining robust compliance features with decentralized technology, Ripple positions the XRPL Permissioned DEX as a transformative tool for the next phase of institutional crypto adoption.
