A proposal circulating in the XRP Ledger (XRPL) community targets one of crypto’s most entrenched trading activities: options.
The idea is to build a purpose-built XRPL sidechain that feels ‘Hyperliquid-like’, a venue designed for exchange-level execution, and then bridge that activity back to the XRPL base layer.
In the proposal documentHyperliquid has shown that a dedicated chain can achieve deep liquidity in derivatives if the execution engine, risk controls, and right incentives are applied.
This move is notable because it signals a broader shift in how parts of the XRPL ecosystem can compete in decentralized finance.
Rather than trying to match universal DeFi ecosystems on an app-for-app basis, the network and its developers want to focus on a specialized financial primitive where market structure matters more than breadth.
In this case, those primitive derivatives are, and more specifically, options.
Why timing matters
The backdrop is a derivatives market that has become one of crypto’s biggest liquidity battlegrounds.
Data from Coin gecko estimates that total perpetual futures trading across centralized and decentralized venues reached $92.9 trillion in 2025, while Perp DEX volume rose 346% to $6.7 trillion.
That level of growth has changed the strategic map for blockchains that were once outside the core conversation of DeFi. If a network can host the power, it can capture the fees, the users, and a larger share of the market relevance.
Hyperliquid has become the clearest example of that shift.
By focusing on a trading-focused stack, including tight execution, cohesive risk design, and an order book model that feels familiar to exchange users, it has become one of the most important on-chain platforms in the industry.
DefiLlamas facts show Hyperliquid booking hundreds of billions in perpetual 30-day futures volumes, billions in open interest, and tens of millions in rolling monthly revenue.
That’s the template the XRPL proposal borrows from, even as it targets a different corner of the derivatives market.
The most important point is strategic. A successful trading platform does not have to be all things to all users. It must solve a limited but valuable problem better than its rivals.
For XRPL, the proposal suggests that the opportunity lies less in pursuing general DeFi composability and more in building a derivatives platform where execution quality and liquidity depth define the product.
The XRPL sidechain focuses on options, not perpetuals
That distinction matters because eternal futures are already busy. Options are not.
However, liquidity in crypto options remains highly centralized, with Coinbase-owned Deribit widely seen as the dominant venue. The company claims to account for approximately 85% of the $40 billion in BTC and ETH options business.
That concentration reinforces itself. Market makers cluster where order flow is deepest, and order flow is attracted to the locations with the tightest spreads and most reliable liquidity.
The XRPL sidechain pitch tries to wedge itself into that structure by highlighting features that are less common in crypto-native options products.
One of the key differentiators is the support for American-style options, which can be exercised before expiration. Much of the crypto options market, especially on centralized platforms, is built around European-style expiration.
That distinction won’t matter to every merchant, especially at launch. But it is important for some hedging and structured strategies, and it gives the proposal a more TradFi-like profile.
For an ecosystem that has spent more time building payment rails than derivatives infrastructure, that’s part of the point.
The proposal also makes clear that this is not intended to be a low-risk testing ground as it includes margin functionality and leverage up to 200x.
In practical terms, this means that the proposal does not describe a prudent options sandbox.
It describes a high-performance platform that would compete for serious derivatives traders, the kind who value execution speed, reliability and capital efficiency as much as product design.
That’s where the opportunity becomes real, but also the difficulty.
Risk engines and liquidity are the real test
Building a derivatives sidechain is easier to describe than to execute, because two tough problems are at the heart of any serious derivatives platform.
The first is the risk engine. Options and leveraged trading require consistent market prices, reliable oracles, liquidation systems, and margin models that hold up under pressure.
If American-style exercises are part of the design, the location must also handle assignments neatly and practice edge cases.
This is not back office data. In volatile markets they become the product.
Trading systems rarely fail in a contained manner. If a platform misjudges risk, freezes during sharp moves, or fails to reliably process liquidations, traders and market makers can quickly lose confidence.
That is one of the reasons why Hyperliquid’s success has been so important. Not only did it provide throughput, but it also provided a cohesive trading experience that convinced liquidity to stay.
The second problem is the concentration of liquidity. Derivatives markets tend to be the winners because traders care about spreads, depth and uptime.
A new location can launch with cutting-edge technology and still remain irrelevant if it cannot attract market makers and sufficient mutual flow.
That makes the XRPL proposal a distribution and credibility challenge as well as a technical challenge.
In that sense, the sidechain pitch isn’t just about copying Hyperliquid’s architecture.
It’s about replicating the flywheel that made Hyperliquid so important in the first place: execution quality leads to liquidity, liquidity improves execution, and stronger execution drives more flow.
Meanwhile, the XRPL sidechain would rely on a minimum-trust bridge design, using XPOP-style proofs and a high validator signature threshold of around 80%.
That’s a strong security posture on paper, but it also makes the coordination of validators an operational issue of the first order. High thresholds can reduce certain attack surfaces, but they can also create a risk of liveness if validators don’t participate consistently or if coordination becomes a bottleneck.
For many blockchain applications, that would be a manageable inconvenience. For a derivatives platform, this is a much more serious problem.
Downtime during calm conditions is one thing. However, downtime during a liquidation cascade is something completely different.
A platform that promises a Hyperliquid-like trading experience implicitly promises reliable operations when markets are disorderly, not just when they are calm.
XRPL’s compliance tooling could shape this bet
The proposal comes as XRPL has built more explicit compliance-oriented primitives.
In recent months, the XRPL has implemented institutional features such as the Permissioned Domains and DEXs.
While it’s unclear whether or not this option’s sidechain is explicitly designed for permissioned liquidity pools, the broader direction is becoming clearer: XRPL is building tools that can support open infrastructure with segmented access on top.
This is important in derivatives, where regulatory scrutiny and compliance are often intense, especially for highly leveraged retail-oriented products.
One plausible long-term design is not a purely permissionless or purely closed site, but a structure that can support permissionless experimentation alongside permitted institutional pools.
That would fit more naturally with XRPL’s existing identity than a direct attempt to become a general-purpose DeFi chain.
In light of this, the commercial opportunities presented by the options market are significant enough to make this effort worth a look.
Using DefiLlama’s rolling monthly metrics for Hyperliquid, a raw implied take rate on volume lands in the low single-digit basis points range.
On that basis, a niche platform on XRPL would generate $0.1 billion to $1 billion in rolling 30-day derivatives volume, which translates to tens to a few hundred thousand dollars per month.
However, a location that reaches 30-day rolling volume of $10 billion to $50 billion could generate low single-digit millions to low tens of millions per month under similar assumptions.
Meanwhile, the bigger prize would come later. Deribit has reported annual options volume in the hundreds of billions in recent year-end updates.
Capturing even 1% to 5% of that amount would be a worthwhile endeavor, but only if the platform can keep spreads tight and systems reliable during volatile periods.
So if the proposal moves from concept to testnet with credible specs, audits, validator participation, and early liquidity programs, it would amount to a serious attempt to reposition XRPL in one of crypto’s most competitive arenas.