XRP Ledger 3.4.0 Goes Live With New Lending Protocol and Network Upgrades
The XRP Ledger has released version 3.4.0 of its reference server, introducing changes across lending, vaults, network stability, transaction handling and infrastructure. The release became available on September 16, with the XRP Ledger Foundation advising server operators to upgrade to maintain service continuity.
XRPL Adds New Lending Infrastructure
One of the biggest changes in the release is LendingProtocolV1_1, an amendment that extends the existing Lending Protocol and Single Asset Vault framework with closed-ended vaults and cash-basis accounting. The amendment is now available for voting rather than automatically becoming part of the live protocol.
Closed-ended vaults introduce three defined phases: subscription, investment and redemption. Depositors can provide assets during the subscription period, while the investment phase locks deposits and allows loans to be originated. During redemption, loans wind down and depositors can withdraw their share of the proceeds.
The change gives XRPL developers a more structured framework for lending markets. Vault schedules are established when a vault is created, allowing participants to know when deposits are accepted, when assets are committed and when withdrawals become available.
Cash-basis accounting is another significant change. Under the updated model, interest is recognized as income when payments are actually made rather than recognizing all scheduled interest when a loan is originated. This changes how lending activity is represented within the vault’s accounting system.
Related: XRP Collateral Use Gains Attention as XRPL Lending Protocol Advances
The broader Lending Protocol is designed for fixed-term, uncollateralized loans using pooled funds from Single Asset Vaults. It relies on off-chain underwriting and risk management to assess borrowers, meaning the system does not currently function like an automated collateralized lending market.
That distinction is important for XRP holders watching the network’s DeFi expansion. Version 3.4.0 does not mean a large lending market has suddenly gone live on XRPL. Instead, it adds protocol infrastructure that could support lending applications if the relevant amendments activate and developers, vault operators and borrowers use the system.
The release also bundles a series of fixes covering Multi-Purpose Tokens, automated market makers, permissioned decentralized exchanges, vault accounting and transaction validation. Several changes strengthen protocol invariants and address edge cases involving token transfers, clawbacks and permissioned DEX activity.
Network Stability and Node Improvements
Beyond DeFi, version 3.4.0 contains changes designed to improve the reliability of XRPL infrastructure. Online deletion now pauses when a node encounters gaps in recent ledger history, helping the server remain closer to the current ledger tip instead of continuing deletion while historical data is incomplete.
The update also optimizes Multi-Purpose Token freeze checks to reduce redundant state reads. Additional peer-protocol changes, including the introduction of peer protocol version 2.3, are part of a wider effort to strengthen communication between XRPL servers.
Security-related changes are spread throughout the release. The update introduces distinct signing hash prefixes for counterparty and sponsor signatures, strengthens transaction and proof validation, and includes fixes originating from MPT and DEX audits and attackathon reports.
The XRP Ledger Foundation has also changed where official DEB and RPM packages are hosted. The packages are now available through packages.xrplf.org with an XRPLF signing key, and server operators using older versions need to update their repository configuration to use the new package infrastructure.
For developers, the release adds additional ledger metadata fields, improves API behavior and includes changes across the build and testing systems. These updates are less visible to everyday XRP users but matter for applications, exchanges, infrastructure providers and operators running XRPL servers.
The larger significance of version 3.4.0 is therefore broader than a single DeFi feature. XRPL is continuing to build native infrastructure for lending, tokenized assets and permissioned markets while also tightening the underlying software that supports the network. The LendingProtocolV1_1 amendment will still need to progress through the network’s voting process before its new functionality becomes active.
For the XRP community, the immediate development is the release itself and the technical foundation it provides. If the new lending amendment receives sufficient support and activates, closed-ended vaults and cash-basis accounting could give developers another framework for building credit markets on XRPL. For now, 3.4.0 marks an infrastructure upgrade rather than proof of a large-scale new lending economy.
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