XRP Ledger Developers Propose Four Fixes to Tighten Restricted Token Holding Rules

XRP Ledger developers have proposed four fixes aimed at closing loopholes that allow restricted tokens to enter accounts without the issuer's approval. These modifications have been integrated into the network upgrade fixCleanup3_5_0, which has not yet been activated on the mainnet. Some restricted tokens require prior approval from the issuer before an account can hold them, but developers have found ways to bypass this approval. The fixes include: requiring both tokens in an automated market maker pool to be approved before purchasing; fixing an issue where approval checks were only triggered on zero-balance trust lines, allowing trust lines that already held tokens to continue receiving more tokens. The XRP Ledger Foundation stated that this is part of routine protocol hardening and not a security incident, with no reports of user impact at this time. Existing unapproved balances come from the issuer or accounts previously approved by them, and no external parties have been found to exploit remaining exceptions to create balances. Once the fixes are in effect, unapproved restricted tokens can only be returned to the issuer, who can approve the holder's trust line at any time to restore usage. The four modifications have not yet been merged into the main software, and after merging, they will require support from over 80% of trusted validators for two consecutive weeks to activate.

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