Abstract
XRP Liquidity is an institutional grade, KYC'd liquidity protocol for the XRP Ledger (XRPL). It enables compliant participation in the XRPL's native Automated Market Maker (AMM, XLS 30) for the XRP ↔ stablecoin pools, providing variable, market driven fee yield—never fixed promises—while embedding a regulatory first stack: identity verification (via Simplici with AI biometrics), explainable AI (XAI) transaction monitoring, OFAC sanctions screening, Travel Rule interoperability, and auditable yet privacy preserving records anchored by Zero Knowledge Proofs (ZKPs).
The protocol runs its own XRPL infrastructure, signs nothing on users' behalf without explicit consent, and provides transparent reporting for Bank Secrecy Act / FinCEN obligations within a risk based AML/CFT program aligned to current U.S. developments under the GENIUS Act, FATF guidance, and OFAC requirements. XRPL's native AMM and auction slot mechanics are used to source organic, on chain fee revenue; USDC on XRPL enables high quality fiat like settlement in the core pools.
⚠️ Disclosure & Non Affiliation
- No fixed yield. Returns are variable and derive from AMM trading fees and auction dynamics; past performance is not indicative of future results.
- Not a bank product. No FDIC/NCUA insurance. Digital assets are risky and can lose value.
- Not Ripple. XRP Liquidity Inc. is independent and not affiliated with Ripple Labs, Inc.
- KYC required. Access requires identity verification (KYC/KYB) and ongoing AML/CFT screening; features may be restricted by jurisdiction.
Product Overview
Identity & Access
KYC/KYB via Simplici with AI biometrics, liveness, document validation, and AML/watchlist screening. Travel rule ready profiles for VASP to VASP transfers.
Liquidity Provision
Users deposit to the XRP/USDC pool and receive LP tokens. Rewards accrue as variable trading fees with optional time lock escrow for policy-driven boosts.
Explainable AI
Risk engine with transparent reasons for flags and human-in-the-loop review. Model governance aligned to regulator expectations for AI explainability.
Zero Knowledge Privacy
Compliance proofs reveal only that policy conditions are satisfied without exposing PII. Full evidentiary records retained privately.
Architecture
🔗 On Chain (XRPL Native)
AMM (XLS 30): AMMDeposit/AMMWithdraw, pool fee parameter, auction slot logic. No custodial pooling by default; users sign transactions with their wallets.
Stable Pairing: USDC trustlines and the XRP/USDC AMM pool facilitate primary liquidity.
Escrows for Time Lock: LP tokens can be escrowed on XRPL for fixed periods with immutable release conditions.
☁️ Off Chain (Compliance & Observability)
Identity Provider (Simplici): Biometric liveness, document checks, global ID coverage, AML/watchlist screening.
Explainable AI Monitoring: Risk models generate scores and human-readable rationales with model governance controls.
Sanctions & Watchlists: OFAC SDN/Non-SDN auto updates with fuzzy match tuning and evidence capture.
Travel Rule: Inter-VASP messaging implements FATF Recommendation 16 fields.
ZK Compliance Layer: Non-transferable credentials proven in zero knowledge without revealing underlying data.
Compliance Framework
We operate a risk-based AML/CFT program aligned to FinCEN rules and FATF standards, enhanced for stablecoin contexts under GENIUS Act policy.
| Control Area | Implementation | External Reference |
|---|---|---|
| AML Program | Risk assessment; policies; training; independent testing; designated Compliance Officer | FinCEN AML/CFT Program, 31 CFR Ch. X |
| KYC/KYB | Simplici IDV + biometrics; document checks; liveness; PEP/sanctions screening | Simplici product documentation |
| Sanctions | OFAC SDN + consolidated lists; program tags; evidence capture; fuzzy matching | OFAC lists & SLS |
| Travel Rule | Inter-VASP data exchange; unhosted wallet risk controls | FATF VA/VASP Guidance & Rec. 16 |
| Explainable AI | Feature level reasons, thresholds, overrides, model validation | FATF new tech guidance; XAI in AML |
| ZK Attestations | Proofs of KYC pass & risk under threshold; on-chain hashes of audit bundles | ZK compliance frameworks |
Security & Privacy
Infrastructure
Dedicated rippled node for submission and Clio for scalable reads; network segmentation; observability; WAF; DDoS mitigation.
Data Security
Encryption in transit and at rest; least privilege access; event hashing to XRPL for tamper evidence and audit trails.
ZK Privacy
Compliance proofs reveal only policy satisfaction; underlying KYC files remain private unless legally compelled with cryptographic assurances.
Roadmap
Q4 2025
Public mainnet launch (U.S. & permitted jurisdictions), XAI risk dashboards, Travel Rule v1 interop. SOC 2 Type I audit start; bug bounty launch.
Q1 2026
ZK attestation v2 (multi-issuer credentials), enhanced unhosted wallet controls, SAR workflow console. Independent AML audit; model validation report.
Q2 2026
Expanded stablecoin set (subject to due diligence), institutional APIs, and custody integrations where permitted by regulation.