XRP Ledger Breaks Barriers: Ethereum Smart Contracts Coming via Sidechain Summer 2025

Ripple''s XRP Ledger is about to get a major upgrade—one that could finally silence the ''it''s just for payments'' crowd. By summer 2025, a new sidechain will bridge the gap between XRP''s speed and Ethereum''s smart contract dominance.

No more ''choose your fighter''—developers get both.

The move strategically positions XRP to compete in DeFi without sacrificing its settlement-layer efficiency. Banks get their compliant rails, degens get their yield farms, and everyone pretends this wasn''t obvious five years ago.

Watch for the usual hype cycle: VC money floods in, legacy finance feigns shock, and some hedge fund manager calls it ''the future'' right before dumping their bags.

How the sidechain works

The Axelar network will function as the exclusive bridge for transferring assets, including the XRP required to create wXRP, between the XRPL mainnet and the new EVM sidechain. The architecture connects XRPL to the more than 69 other blockchain ecosystems supported by Axelar.

The sidechain operates on a Proof-of-Authority (PoA) consensus mechanism, selected for performance and efficiency. Its targeted metrics are over 1,000 transactions per second and transaction costs below $0.01.

To ensure network integrity, the sidechain’s code underwent a security audit by Informal Systems in February 2025. The audit identified and led to the resolution of one critical issue related to a Cosmos SDK module, with other findings being of low risk.

This initiative represents a strategic effort to attract developers from the larger EVM ecosystem and provide new avenues for applications on the XRP Ledger. By lowering the barrier to entry, the sidechain may foster a more diverse application environment for XRPL’s user base, which holds over six million wallets.

The use of wXRP for transaction fees introduces a new demand mechanism for the XRP token, tying its utility directly to the activity level on the EVM sidechain. This could extend its tokenomics beyond its primary function in facilitating cross-border settlements.

Activity on the sidechain’s testnet suggests initial developer interest. According to a post from Peersyst, projects including Strobe Finance, Vertex Protocol, and Secured Labs are already building applications.

The firm also reported that 87 new entities with no prior involvement in the XRP ecosystem are now contributing on the testnet, suggesting the potential for broad ecosystem growth upon the mainnet’s release.

The project’s structure as a sidechain allows these new capabilities to be introduced without altering the XRPL mainnet’s Core protocol, which remains optimized for payments. The mainnet launch of the XRPL EVM Sidechain is scheduled to proceed in the second quarter of 2025.