While Ripple’s XRP just debuted on Solana with the wXRP ticker, further cross-border adoption could be coming at a slower pace, according to the latest statements from Ripple’s CTO. David ‘JoelKatz’ Schwartz, Ripple’s Chief Technology Officer, has been running test codes on several blockchains to evaluate potential DeFi bridging systems.
Slacking On Security Isn’t The Solution
Exploring these cross-chain opportunities for Ripple’s fresh USD-pegged stablecoin RLUSD, David Schwartz noted that security risks wouldn’t be such a big issue if companies chose the best security & risk management suite on the table. Surfing through the offers, Ripple’s CTO said that simplicity was ultimately pitched as the superior virtue over premium security.
“One thing I noticed is that most schemes were very well designed and had really strong mechanisms available to protect against exactly the type of attack the KelpDAO/rsETH situation seems to have been caused by”, – explained the veteran dev. He referred to the recent $292 million KelpDAO hack that shook the confidence of DeFi protocols, explaining his scenario.
According to Ripple’s (the original issuer of XRP) CTO, the main issue could have been the ‘convenience’ of using a cheaper security & risk management alternative, as it’s typically promoted to company executives as the ‘best value’ option.
Ripple’s CTO Deciphers KelpDAO’s Hack
Notably, the message from JoelKatz suggests that crypto companies shall put their protocol security as a top priority, while others voiced concerns over wXRP.
Released on Solana last weekend, the wrapped version of XRP on SOL might carry similar risks to KelpDAO, one popular community voice suggests. As the XRPL developer community is getting ready to vote on key lending protocol amendments for extra security, the ability to use XRP on non-native chains will open up portals to collateral usage.
But that comes with its own risks. KelpDAO’s exploiter collateralized the siphoned funds via Aave V3, borrowing stupendous amounts of Ethereum (ETH) & the wrapped version (wETH). The trails of transactions were hidden via Tornado Cash, a crypto mixer infamously used by the most vigilant hacker groups, such as the North Korean Lazarus Group.
With the DeFi hacks picking up pace, compliance-first digital assets like XRP & RLUSD have the upper hand against legally-vague cryptos. However, that doesn’t prevent RLUSD or XRP from getting hacked on DeFi liquidity pools when bridged to other popular blockchain platforms.
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People Also Ask:
Ripple’s stablecoin, RLUSD, is being prepared for deeper integration into DeFi platforms. This comes shortly after XRP was bridged to Solana, allowing it to be used in Solana’s fast and cheap DeFi ecosystem.
David Schwartz (Ripple CTO Emeritus) revealed that he personally evaluated many DeFi bridging systems for RLUSD. He focused heavily on security and risk. While the technology itself has strong protections, he noticed many projects disable key security features to make things faster and easier to use.
Recent massive exploits like the $292 million Kelp DAO hack showed how dangerous poorly secured bridges can be. Schwartz is warning that rushing into DeFi bridges without proper safeguards could put RLUSD at risk.
Yes, but cautiously. Ripple wants RLUSD to expand into DeFi for more utility, but Schwartz is pushing a security-first approach rather than rushing for speed and convenience.
It’s a positive long-term signal that Ripple is expanding utility (first XRP on Solana, now RLUSD in DeFi), but they’re being careful not to repeat the mistakes that caused big hacks. This could make both assets more useful in the future while trying to avoid unnecessary risks.
