XRP Ledger Proposal Targets Flash-Loan Attacks, Touts Architectural Edge Over Ethereum DeFi

Flash loans allow traders to borrow without collateral, transact with the assets and repay the loan within a single transaction. They are commonly used for arbitrage and liquidations but can also be abused to manipulate oracles or drain liquidity pools. Ethereum protocols including Aave and dYdX support the mechanism. XRP Ledger transactions cannot make composable calls to other contracts during execution, eliminating the “borrow, manipulate, repay” attack path.

An XRPL AMM draft amendment released on May 27, 2026, proposes adding concentrated liquidity and StableSwap pools and says flash-loan attacks are structurally impossible. THORChain lost about $10.8 million in an attack on May 15, while Drift Protocol and KelpDAO had sustained combined losses of more than $600 million as of the end of April. The value of tokenized real-world assets on XRPL has surpassed $3 billion.