Privacy Is Coming to the XRP Ledger. Here’s the Latest

In a recent post, XRP Ledger validator Vet (@Vet_X0) celebrated a huge development, noting that privacy is coming to the network. He was pointing to a real code change as GitHub pull request #5860 on the rippled repository proposes confidential transfers for Multi-Purpose Tokens. The XLS-96 standard behind it lays out exactly how the feature would work.

Understanding the Token Standard

Multi-Purpose Tokens (MPTs) are XRPL’s standard for issuing tokenized assets, like real-world assets (RWAs). On the public XRP Ledger, token balances and transfers are visible on-chain, allowing anyone to inspect which addresses hold a token and how assets move between addresses.

While this transparency benefits many use cases, institutions often require greater confidentiality around holdings and transaction activity.

Privacy is coming to the XRP Ledger 😈

Confidential transfer allow individual balances and transfer amounts of issued assets like RWAs to be hidden from validators and the public.

Institutions particularly benefit from
– Private collateral management
– Private settlement
-…

— Vet (@Vet_X0)

Institutional Stakes Behind the Post

Vet listed specific benefits of the new amendment for institutions adopting this technology. He named private collateral management, private settlement, and the ability to hold market positions without signaling size to competitors. A fund moving large positions doesn’t want rivals watching every transfer and reacting in real time.

He drew a specific contrast with other privacy protocols. He said this approach remains “fully compliant unlike other protocols” because issuers and holders keep a key for selective disclosure. Auditors and regulators can still verify what they need to see.

The technical design backs up his claim. XLS-96 uses EC-ElGamal encryption and zero-knowledge proofs to hide individual balances and transfer amounts. Total supply remains public and verifiable through existing invariants, so validators can still confirm the system hasn’t been gamed. Issuers get a dedicated encryption key for auditing, and they can optionally add an auditor key for regulatory oversight. Neither key exposes data publicly. Both exist purely for authorized disclosure.

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— TimesTabloid (@TimesTabloid1)

Where the Amendment Stands Today

The amendment remains a work in progress. Some parts of the feature still need to be finished before it works as intended, and the team building it hasn’t completed the steps required to make it fully safe to use.

Reviewers have already found real issues, too, and they’ve asked for changes before this can move forward. That back-and-forth is normal at this stage, and it’s a sign the process is working how it should.

Tying It Together

Vet’s post captures why this amendment matters for XRP’s institutional ambitions. RWA tokenization only scales if institutions trust the ledger with sensitive financial data. Full transparency blocks that trust. XLS-96 offers a path where privacy and compliance coexist, and Vet’s framing of the technology as compliant speaks directly to the audience XRP is courting.