The XRP Ledger activated a new permission system on October 8 that lets banks, stablecoin issuers and tokenized fund managers grant limited powers to subordinate accounts while keeping master keys offline, according to the amendment tracker.
The feature, called PermissionDelegationV1_1, allows a delegator to assign up to 10 specific permissions to separate accounts. Those permissions can include approving customers, executing payments, and freezing accounts. The delegator retains full control of the master key and can revoke any delegated permission at any time.
Institutional custodians and payment processors have long faced a security trade-off: keeping master keys offline requires manual intervention for every transaction, slowing settlement; keeping keys online exposes the full account to compromise if a signing device is breached. The new system splits the risk. An operator can keep the master key in cold storage while granting a hot wallet only the power to, say, approve KYC'd customers or move funds within pre-set limits. If the hot wallet is compromised, only those specific functions are exposed.
The XRP Ledger, which processes transactions for Ripple's payment business and other networks, has pursued institutional adoption through custody and compliance tooling. In March 2024, the ledger added account freeze functionality that lets issuers block transfers of their own tokens. The delegated key feature extends that model by letting issuers and custodians architect their own permission hierarchies without modifying the ledger itself.
The activation required an amendment, meaning it needed approval from the network's validator set. Amendments to the XRP Ledger typically demand 80 percent support from active validators before they take effect. The feature is now available to all network participants.
The mechanism is native to the ledger's account model. Unlike Ethereum, where permission delegation often requires smart contracts, the XRP Ledger encodes it directly into the protocol layer. This removes the need for a third-party custody service or middleware to manage sub-accounts, though institutions can still layer those services on top if they choose.
Adoption will depend on how quickly custodians, stablecoin issuers and tokenized asset platforms integrate the feature into their systems. The ledger does not publish live adoption metrics, so the real-world take-up will only appear through ecosystem announcements or on-chain analysis of delegated account activity over time.
