XRP Automated Market Maker Launches

Ripple’s Chief Technology Officer, David Schwartz, took to Twitter to announced the launch of the XLS-30 automated market maker (AMM) on XRP mainnet. 

Alongside the announcement, Schwartz also emphasized the importance of caution for users venturing into trading via the newly deployed AMM, providing essential guidance to ensure safe participation.

After ~2 years, the day has finally arrived – the AMM is live on XRPL mainnet! Thus begins a longer road from today’s initial rollout to future growth milestones for users, traders, devs, market makers and many more. Looking forward to the journey alongside all of you in the XRPL… https://t.co/JZjxloxo06

— David “JoelKatz” Schwartz (@JoelKatz) March 22, 2024

In a recent blog post, RippleX developers discussed deploying the non-custodial XLS-30 AMM on the XRP Ledger. This marks a major change in the network’s liquidity and trading patterns. 

XRP Trading with XLS-30 AMM

Designed specifically for the XRPL DEX (Decentralized Exchange), this integration promises returns for liquidity providers while offering reduced slippage for traders dealing with a wide range of tokens. Furthermore, developers now have access to XLS-30 to facilitate integration with the AMM, allowing them to create custom interfaces for trading and liquidity provision.

Schwartz warned traders who were navigating the AMM landscape to be careful. He told people not to make one-sided payments into AMMs that don’t have a lot of cash on hand because they could lose money during the deposit process.

CAUTION: If you make a single-sided deposit into an AMM that doesn’t have significantly more liquidity than the size of your deposit, you will take a loss in the deposit process.

Whatever tool you’re using typically warns you about this loss as a report of “slippage”. If you see…

— David “JoelKatz” Schwartz (@JoelKatz) March 23, 2024

Traders with a lot of slippage during deposits were also told to look into other choices besides single-sided deposits. Schwartz also talked about the chance of losses during deposits made into an AMM that wasn’t balanced before the investment. 

Nonetheless, he reassured users that such instances should be rare, suggesting that prolonged imbalance within an AMM indicates missed profit opportunities for all involved.