Ripple’s Secret Weapon: The Clawback Feature You Didn’t Know You Needed!

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In a recent exchange on the digital agora known as X, the illustrious Ripple CTO, David Schwartz, took it upon himself to illuminate the masses about a rather intriguing aspect of Ripple’s stablecoin, RLUSD. Ah, the wonders of modern finance! 🌍💰

The discourse was ignited by none other than XRP aficionado and legal sage, Jeremy Hogan, who, in his infinite wisdom, pondered the implications of a newly proposed stablecoin bill. He concluded his musings with a question that could make even the most stoic of philosophers raise an eyebrow: “Can Ripple or Circle actually freeze RLUSD or USDC once it’s transferred? I thought that was as likely as finding a unicorn!” 🦄

As fate would have it, an inquisitive soul in the digital crowd directed this burning question to Schwartz, seeking further enlightenment. And lo! Schwartz, with the flair of a seasoned orator, responded, revealing that indeed, RLUSD can be frozen or “clawed back.” He elaborated, “This is necessary because we want balances on the ledger to accurately reflect the legal obligations of the issuer. After all, off-ledger activities, like court orders, can make those obligations vanish faster than a magician’s rabbit!” 🎩✨

RLUSD can be frozen or clawed back. This is necessary because we want balances on the ledger to accurately reflect legal obligations of the issuer and off-ledger activity, such as court orders, can make those legal obligations go away or change.

— David “JoelKatz” Schwartz (@JoelKatz) March 12, 2025

Then came Vet, an XRPL dunl validator, who chimed in with the wisdom of the ages, stating that “RLUSD can be frozen and clawed back on both Ethereum and the XRP Ledger if the issuer, Ripple, is requested by law enforcement or court orders to do so.” A round of applause for the legal eagles, please! 👏

More on “clawback”

Ah, the clawback! A feature that allows the issuer to reclaim tokens from users’ wallets under certain conditions. It’s like a financial safety net, ensuring compliance with regulations, recovering assets from the clutches of fraud, or simply retrieving tokens sent to the wrong address—because who hasn’t sent a birthday gift to their ex? 🎁😅

In a moment of legislative triumph, a clawback amendment was enabled on the XRP Ledger after garnering a whopping 90% approval. The “AMMClawback” amendment allows issuers to reclaim tokens from an Automated Market Maker (AMM) if the clawback feature is enabled. It even modified the “AMMDeposit transaction type” to prevent frozen tokens from being deposited into the AMM. Talk about a financial fortress! 🏰

This amendment paved the way for Ripple’s RLUSD stablecoin to be traded directly on the XRP Ledger’s decentralized exchange (DEX). A true marvel of modern finance!

In other news, the XRP Ledger has been integrated into RWA.xyz, an analytics platform for RWA tokenization. Users can now bask in the glory of real-time insights across a plethora of tokenized assets and blockchain activity, including U.S. tokenized treasuries and RLUSD stablecoin data. Because who doesn’t want to keep tabs on their digital treasures? 💎

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2025-03-12 17:27