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An XRP community expert has shared how investors could avoid selling their XRP tokens while still realizing income from it.
Notably, several market pundits have encouraged investors to hold their XRP rather than sell it. These experts argue that selling creates capital gains taxes and reduces long-term exposure to the token. Instead, they promote borrowing against XRP as a way to access funds while keeping ownership intact.
Brad Kimes from Digital Perspectives recently shared this view in his latest video commentary after reports surfaced that Ripple developers may be working on native XRP lending on the XRP Ledger.
Ripple Developers Exploring Native Lending on XRPL
Kimes credited community figure Diana with highlighting the update, noting that Ripple developer Edward Hennis brought the proposal to light. As previously reported by The Crypto Basic, Ripple developers are exploring a system that would allow institutions to borrow XRP directly on the ledger, treating it more like traditional money.
According to Kimes, native lending would allow XRP to be borrowed, locked, used, and repaid entirely on the XRP Ledger. This removes the need for third-party platforms and reduces risk. He noted that each loan would stand on its own, meaning one borrower’s failure would not affect others.
Kimes also explained that borrowed XRP would stay locked for set periods, similar to traditional loans. The pundit stressed that this temporarily reduces the amount of XRP available on the market, which could support prices as demand grows. He called the idea a major trust upgrade for banks and payment companies.
Throughout his commentary, Kimes mentioned his preference for borrowing directly on the ledger. He said he feels safer using a built-in system rather than relying on outside platforms when taking loans against crypto assets. Notably, the implosions of Voyager, Celsius, and BlockFi in 2022 exposed the risks of third-party lenders.
Kimes explained how the lending structure could work, noting that each borrower’s XRP would sit in a single-asset vault. A pool administrator or loan manager would oversee the process, while external platforms could build user interfaces. Importantly, this ensures that borrowers only face risks tied to their own positions.
How to “Never Sell Your XRP”
Kimes aligned the concept to what he called the “holy grail” in the XRP community: never selling XRP. While he clarified that he was not giving financial advice, he said many wealthy individuals follow this approach by borrowing against assets instead of selling them. This method helps delay taxes and maintain long-term ownership, as long as borrowers avoid taking on too much risk.
He also referenced comments from EasyA founder Dom Kwok, who expects market volatility to decrease over time as crypto markets mature and liquidity improves. Kimes said increased utility in areas such as payments, settlement, ETFs, and lending could make XRP prices more stable.
To explain the strategy further, Kimes presented a model he could follow. In his example, an investor could use a small portion of XRP holdings, such as 10%, as collateral for a loan. The borrowed funds go into income-producing assets like apartment buildings or laundromats.
Kimes explained that income from these assets can repay the loan, while remaining earnings become taxable income. Over time, the investor owns both the XRP and the businesses. Eventually, the investor can borrow against those businesses instead, leaving XRP untouched.