The XRPL EVM Sidechain is an independent sidechain of the XRP Ledger (XRPL) network supported by the Ethereum Virtual Machine (EVM). Its integration, when the testing phase ends, will allow the execution of smart contracts and decentralized applications (dApps) within the XRP ecosystem.
Currently, the XRPL EVM Sidechain is is in a testing phase and is available for development purposes (devnet). For now, in accordance with the provisions of its documentsit is advised not to send transactions on the main network until this procedure is completed.
Since a member of the XRPL Foundation explained that this sidechain would be ready “soon”, this article will review the most relevant utilities and qualities of the XRPL EVM Sidechain.
Behind the XRPL EVM Sidechain are Ripple and the company Peersyst.
Main Features of the XRPL EVM Sidechain
As noted, one of the most relevant qualities of the XRPL EVM Sidechain is that it will allow the Ethereum ecosystem to be connected to the XRP Ledger mainnet through the EVM.
The EVM is the execution environment of Bitcoin-criptomonedas-seguridad/#google_vignette” target=”_blank” rel=”noreferrer noopener”>smart contracts on the Ethereum network. It is a decentralized virtual machine that acts as a global computer, where network nodes execute the same calculations and validate the same results to maintain a distributed consensus.
Smart contracts are self-executing computer programs that are stored on the network. They are designed for automatically execute instructions when certain predefined conditions are met. They operate under the logic of “if X happens, then execute Y.”
The XRPL EVM Sidechain allows you to execute these smart contracts written in Solidity (Ethereum’s native programming language) within the XRPL ecosystem.
This means that developers will be able to migrate dApps existing Ethereum applications to the XRPL EVM Sidechain without significantly modifying your code, or creating new applications on XRPL using familiar Ethereum tools and languages.
XRPL wants to benefit from the Ethereum ecosystem
While at the beginning of September 2024, Ripple announced the introduction of smart contracts natively on XRPL, event reported According to CriptoNoticias, this circumstance is still under development.
As such, the team behind the XRPL network aims to expand its utilities and use cases through the XRPL EVM Sidechain. For example, this integration would facilitate access to decentralized finance applications (DeFi), markets NFT-non-fungible/” target=”_blank” rel=”noreferrer noopener”>NFTs, DAO (decentralized autonomous organizations) and other platforms from XRPL.
By integrating with Ethereum, a network with significant capitalization and activity, XRPL could see an increase in adoption and cash flowattracting new users and investors.
How does the XRPL EVM Sidechain work?
Interoperability between XRPL and the XRPL EVM Sidechain is done through a bridge. Bridges are specialized protocols designed to facilitate this task between different blockchains.
Assets (like XRP) are “locked” on the mainnet and are issued as equivalent representations in the sidechain. This maintains liquidity and prevents duplication of assets.
Once the asset is returned to the XRPL, it is destroyed on the sidechain to ensure accounting balance. Wrapped XRP (eXRP) will serve as the wrapped token for transactions across interchain bridges.
The following image shows the devnet bridge interface of these two chains.
To trade between the EVM Sidechain and the XRPL mainnet, users will be able to do so with MetaMask. Fountain: Bridge XRPL.
The bridge used to connect these chains is the Axelar Network, a “decentralized communication between chains” protocol designed to provide connectivity in Web3 ecosystems, in accordance with the documents of XRPL EVM Sidechain.
Transfers between both networks are made through the Axelar Interchain Token Service (ITS).
ITS consists of a series of smart contracts located on the XRPL EVM Sidechain, which manage the transfer of tokens between different chains. The bridge acts as a temporary “custodian.”
Finally, it should be noted that the Axelar bridge meets the standard XLS-38d (XRP Ledger Specification), an improvement proposal that refers to the implementation of bridges between the XRPL main chain and the XRPL EVM Sidechain.
What consensus algorithm does the EVM sidechain use?
The XRPL EVM Sidechain is powered by the Proof of Authority consensus algorithm. PoA).
It focuses on the use of authorized validators, who work on creating blocks and validating transactions to ensure consensus within the network.
In turn, authorized validators are tasked with updating the network registry and adding new validators. They are public entities that must comply with criteria of trust, reputation and technical requirements, chosen by those who manage the network (in this case, Ripple and its partners).
Currently, the XRPL EVM Sidechain devnet has 25 authorized validators.
The minimum requirements to run a node on this sidechain and become an authorized validator are as follows:
In the PoA, the validators operate in a system in which each one takes turns to propose and validate blocks. This model attempts to reduce the complexity of consensus, eliminating the need to compete for validation.
Transactions are considered confirmed once the corresponding block is approved by the authorized validator. In this sense, from the XRPL EVM Sidechain they assure which has the capacity to handle 1,000 transactions per second and that blocks are processed every 5 seconds.
When CriptoNoticias reviewed the explorer of this chain, the blocks were processed every 1 or 2 secondsbeing mostly empty or with a single transaction.
Fees on the XRPL EVM Sidechain
The EVM sidechain will have no block reward. The fee paid by users for transactions confirmed on the EVM sidechain will be distributed to the validator nodes of the EVM sidechain. The cost of these rates is 0.10 XRP ($0.24 currently).
In the XRPL EVM Sidechain, gas fees are divided into two main components: the Base Fee and the Priority Fee (Tip).
The Base Fee (also measured in gwei) is a minimum fee that users must pay for each unit of gas consumed in a transaction, and its amount is burned, reducing the total supply of XRP on the network. This introduces a deflationary effect in the ecosystem.
On the other hand, the Priority Fee is an optional additional fee that users can offer for validators to prioritize their transactions. These tips are delivered directly to validatorsencouraging participation in the network.
How much on-chain activity does the XRPL EVM Sidechain record?
After almost a year of being in the devnet stage, this chain accumulated 4,441 total addresses. After an increase at the end of 2023, total accounts saw sustained, although not very pronounced, growth throughout 2024.
However, when reviewing active accounts, that number is drastically reduces. According to your browser data, as of December 17 there are 13 active accounts on the XRPL EVM Sidechain.
Regarding the number of transactions, in total it amounts to almost 700,000 as of December 17.
Ultimately, at the time of this article, there are deployed 15 applications in the XRPL EVM Sidechain ecosystem. Among them, some DeFi, wallets and educational platforms.
While adoption does not yet appear to be significant, the true impact of the integration of the Ethereum ecosystem with that of XRP will need to be evaluated once the XRPL EVM Sidechain mainnet is launched, which could indicate its ability to compete in the space of decentralized applications.
Thus, the XRPL EVM Sidechain will work as a nexus that allows Ethereum users and developers to increase the features and use cases from XRP Ledger.
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