XRP Ledger developers are reviewing two code changes designed to close remaining gaps in the network's controls for permissioned tokens. The proposals would tighten authorization checks for automated-market-maker liquidity tokens and prevent an unauthorized trust line from receiving additional funds simply because it already carries a balance. Both pull requests remain open, so the changes are not part of an activated mainnet rule.

Two proposals remain open

The current work is grouped under the planned fixCleanup3_5_0 amendment. Developers initially split the authorization review across four pull requests, but two broader layers were closed after review. The two remaining proposals, opened October 27, target specific paths that could expose an account to a restricted asset without the issuer approval normally required by the XRP Ledger's trust-line model.

Related reporting: XRP Ledger Batch upgrade slips to October 9

AMM liquidity tokens would face a wider gate

Pull request 8648 focuses on liquidity-provider tokens issued by XRP Ledger automated market makers. An LP token represents a claim on both assets held by a pool. The proposal says an account should therefore be authorized for both underlying assets before it can acquire the LP token. The check would cover payments, exchange offers, NFT offers, AMM bids and deposits, addressing routes that could bypass the authorization applied when liquidity is deposited directly.

The proposed gate would not prevent an account from divesting. Returning an LP token to its pool or withdrawing one asset at a time would remain possible. The code also leaves issuer-led clawback handling outside this new check, reflecting the distinction between preventing new unauthorized exposure and allowing an issuer to remediate an existing position.

Closing the existing-balance exception

Pull request 8650 addresses a separate payment-engine behavior. The authorization check currently applies when an unauthorized trust line has a zero balance, but a line that already holds tokens can continue receiving more. Under the proposal, an unauthorized line would be unable to receive additional units. An exact redemption back to the issuer would still be allowed, while a payment that tries to cross through zero and create a fresh unauthorized balance would fail.

Why issuers and holders should care

The changes matter most to issuers that use permissioned tokens for identity, eligibility or compliance controls, including potential stablecoin and tokenized-fund structures. They concern issued assets and claims on AMM pools, not ordinary ownership or transfer of the ledger's native XRP asset. For holders, the practical effect would depend on authorization status. A balance on an unauthorized line would remain returnable to the issuer, but it could not be expanded or routed onward as ordinary spendable inventory. CoinDesk reported that the XRP Ledger Foundation knew of no outsider exploiting the remaining exceptions and described the work as routine protocol hardening rather than an incident response.

No activation date yet

The proposals still have several steps ahead. They must complete review, be merged into the reference software and ship in a release before validators can consider activation. XRP Ledger amendments require support from more than 80% of trusted validators for two consecutive weeks. Until that process occurs, fixCleanup3_5_0 is a development proposal, not a live restriction. Review changes could also alter the final scope, so issuers and infrastructure providers should track the merged code rather than assume the current draft is settled.

Sources

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