XRPL EVM: Bidirectional Bridge, Axelar Cross-Chain, and Gas Mechanics Explained – How XRP Ledger Competes with Ethereum

XRPL EVM: Bidirectional Bridge, Axelar Cross-Chain, and Gas Mechanics Explained – How XRP Ledger Competes with Ethereum

In July 2025, Ripple introduced the XRPL EVM Sidechain on mainnet, bringing full Ethereum-style smart contract functionality to the XRP Ledger for the first time. This EVM (Ethereum Virtual Machine) compatible sidechain connects to the XRP Ledger and effectively bridges the gap between XRP’s high-speed, low-cost payments network and Ethereum’s expansive smart contract ecosystem.

In simpler terms, XRPL EVM lets developers deploy Ethereum-based decentralized applications (dApps) while leveraging XRP’s liquidity, fast transactions, and low fees. The result is a hybrid platform aimed at competing with Ethereum by offering similar capabilities with improved performance and cross-chain interoperability.

Below, we break down how XRPL EVM works – including its bidirectional Ethereum bridge, use of the Axelar network for cross-chain transfers, unique gas fee mechanics, and how it stacks up against other EVM chains like BNB Smart Chain and Avalanche.

XRPL EVM Sidechain Overview and Current Status

XRPL EVM is a dedicated sidechain of the XRP Ledger (XRPL) that supports the Ethereum Virtual Machine. Launched on mainnet on June 30, 2025 after a successful testnet phase, it enables Ethereum-compatible smart contracts to run within the XRP Ledger ecosystem.

This sidechain was developed through a collaboration involving Ripple, Peersyst, and contributors from the Cosmos and Axelar communities. It’s built using the Cosmos SDK and Evmos (Ethereum-on-Cosmos technology), and operates with a Proof of Authority (PoA) consensus model for fast finality.

In practice, this means a set of trusted validators (over 25 companies at launch) produce blocks, prioritizing speed and efficiency. Thanks to this design, the XRPL EVM chain can handle more than 1,000 transactions per second with block times around 3–5 seconds, a big improvement over Ethereum’s ~15 TPS and ~14-second blocks.

Importantly, the XRPL EVM Sidechain shares XRP as its native currency, mirroring XRPL’s core asset on the sidechain for all fees and transactions. Developers can use familiar Ethereum tools like Solidity, Hardhat, and MetaMask to deploy or port dApps to XRPL EVM without steep learning curves. This environment combines the advantages of XRPL (fast, low-cost, reliable payments) with Ethereum’s flexibility.

As Ripple’s CTO David Schwartz put it, the goal is to “extend the capabilities of the ecosystem without changing the fundamentals that make the XRPL reliable”. Early interest has been strong – during testnet, XRPL EVM processed over 10 million transactions and attracted dozens of new development teams, signaling enthusiasm for bringing DeFi and smart contracts to the XRP Ledger’s millions of users.

Bidirectional Bridge to Ethereum and Token Compatibility

One of XRPL EVM’s headline features is its bidirectional bridge connecting the XRP Ledger and Ethereum environments. In practice, this is achieved via the Axelar interoperability network (explained more below) which acts as the bridge between XRPL mainnet and the EVM sidechain, and further out to other chains. This bridge allows assets – especially XRP – to move back and forth between the XRPL and Ethereum ecosystems in a secure, one-to-one manner.

For example, an XRP holder on the XRPL mainnet can transfer XRP into the EVM sidechain, where it appears as a wrapped equivalent (often called eXRP) for use in EVM applications. The original XRP on the mainnet is locked while the wrapped token circulates on the sidechain, ensuring a 1:1 peg that preserves value.

When the user wants to move back, the process reverses: eXRP on the sidechain is burned/unlocked and the same amount of XRP is released on the main ledger. This two-way bridge means XRP can seamlessly flow into Ethereum-style smart contracts (lending, DEXs, NFTs, etc.) and return to the XRPL, effectively making XRP interoperable with Ethereum’s DeFi world.

Token compatibility is a major benefit of this bridge. On the XRPL EVM sidechain, XRP functions much like ETH does on Ethereum – it’s used for gas fees and can serve as the base currency for trading and liquidity. Moreover, the sidechain supports ERC-20 tokens and other Ethereum standards, so developers can create or bridge tokens that adhere to Ethereum’s formats. This means that assets from Ethereum (or other EVM chains) can be represented on XRPL EVM and interact with XRPL-based dApps. For instance, one could bridge a stablecoin (like USDC) from Ethereum onto XRPL EVM and use it in an XRP-based DeFi application.

Likewise, XRPL’s own issued tokens (or XRP itself) could potentially be exported to Ethereum or networks like BNB Chain and Avalanche via the same interoperability routes. In short, the bidirectional bridge makes XRP and XRPL assets “Ethereum-compatible” and vice versa, unlocking cross-platform liquidity.

All transfers are managed by the Axelar network’s decentralized protocols, which maintain the accounting so that for every XRP on the sidechain, one XRP is locked on the mainnet (preserving scarcity and value). This development brings a new level of token flexibility to XRP holders – XRPL value can be deployed in Ethereum’s extensive dApp ecosystem without leaving the XRPL network’s orbit.

Cross-Chain Interoperability via Axelar Network

To achieve these seamless transfers, XRPL EVM leverages the Axelar network as its cross-chain interoperability layer. Axelar is a decentralized protocol that links over 80 different blockchains, enabling secure cross-chain communication and token transfers. Think of Axelar as a universal translator and bridge connecting otherwise isolated networks. In the context of XRPL EVM, Axelar serves two key purposes:

• XRPL ⇄ XRPL EVM Connectivity: Axelar provides the official bridge between the XRPL mainnet and the EVM sidechain. When you move XRP into the sidechain (or out of it), Axelar’s network of validators and its smart contracts handle the locking, minting, and verification to ensure the transfer is atomic and secure. This unified bridge infrastructure simplifies the user experience (there’s a single, consistent method to bridge assets) and was chosen for its robust security (Axelar is secured by a large validator set with dynamic key management). Using a trust-minimized network like Axelar means there is no single custodian of bridged funds; instead, the process is decentralized and audited, mitigating risks that have plagued older cross-chain bridges.
  

• Beyond XRPL – Multichain Integration: In addition to linking XRPL to its EVM sidechain, Axelar opens the door for interoperability with many other chains. Since Axelar connects dozens of blockchains, the XRPL EVM sidechain becomes one more “spoke” in that cross-chain hub. In practical terms, this means assets and messages can flow between XRPL EVM and other EVM-compatible networks (and even some non-EVM chains) with relative ease. For example, a user could move value from XRPL EVM to Ethereum, Polygon, or others supported by Axelar, and developers can build cross-chain dApps that tap into liquidity on multiple networks. The XRPL EVM team even integrated Squid (Axelar’s official cross-chain swap interface) to make moving assets via Axelar user-friendly.

Furthermore, plans for Wormhole integration are underway to complement Axelar. Wormhole is another major cross-chain protocol, and integrating it will connect XRPL (and the EVM sidechain) to an even broader set of ecosystems (over 35 blockchains), including prominent ones like Solana, Avalanche, Polygon, and BNB Chain. In fact, Ripple announced in June 2025 a Wormhole bridge integration that would allow XRP Ledger’s native tokens to move across those networks while maintaining their native issuance.

The combination of Axelar and Wormhole connectivity positions XRPL EVM as a truly interoperable platform. Developers can envision cross-chain applications where, say, an XRP-backed tokenized asset on XRPL interacts with a smart contract on Avalanche or a Solana-based NFT, all enabled by these bridges.

This focus on multichain capability shows XRPL’s strategy: rather than operate as a silo, XRPL EVM aims to be a hub in the wider blockchain universe, extending XRP’s utility across many networks. By doing so, the XRP Ledger ecosystem can compete not just with Ethereum, but in a multichain world where value moves freely to wherever it’s most effective.

Gas Mechanics on XRPL EVM vs. Ethereum and Others

A critical difference users and developers will notice on XRPL EVM is the gas fee mechanism. On Ethereum, every transaction or smart contract operation consumes “gas” measured in units of ETH. Ethereum’s fees have historically been high, often ranging from a few dollars to tens or even hundreds of dollars for complex transactions during peak congestion.

In contrast, XRPL EVM uses XRP as the gas token, and the fees are designed to be minimal – typically under a penny per transaction. This means when you execute a smart contract on XRPL EVM, you pay in XRP (the same coin that powers the main XRP Ledger) instead of ETH. Because XRP Ledger technology was built for efficiency (standard XRPL transactions cost just 0.00001 XRP as a base fee, which is a tiny fraction of a cent), the EVM sidechain inherits a philosophy of ultra-low fees.

The gas model on XRPL EVM is similar in structure to Ethereum’s (you still have gas limits and gas prices for EVM operations), but thanks to the network’s higher throughput and PoA consensus, the gas price can be kept very low and stable. There aren’t bidding wars for block space like on Ethereum – the trusted validators can process a high volume of transactions (1000+ TPS capacity) without needing to let fees spike to throttle usage.

As a result, transactions that might cost a few dollars on Ethereum could cost a tiny fraction of an XRP (worth far less than a cent) on XRPL EVM. For end users, this is a big win: everyday DeFi operations – swaps, yield farming, NFT trades – become affordable and fast, much like on other low-cost chains (e.g. BSC or Polygon). The block finalization in under 4 seconds also means you get nearly instant confirmation of transactions, improving the user experience over waiting half a minute or more on Ethereum.

Another implication of using XRP for gas is the bridging of liquidity between XRPL and EVM realms. Since XRP is one of the most liquid cryptocurrencies globally, having it as the gas and base currency on the sidechain means that value can move readily between the XRPL EVM and other networks without constantly swapping between different coins.

Developers can list XRP trading pairs in their dApps, and users can utilize their XRP holdings directly in DeFi. This is the first time XRP can be used directly within Solidity smart contracts (previous attempts to use XRP in Ethereum required wrapped IOUs or third-party bridges).

Now, XRP effectively “lives” in both worlds – the XRPL mainnet for payments and the EVM sidechain for contracts – using the same asset. This gas design contrasts with BNB Smart Chain’s BNB gas or Avalanche’s AVAX gas in that XRP’s value proposition (fast, low-cost transactions by design) underpins the whole system.

In short, XRPL EVM inherits XRP Ledger’s fee philosophy: prevent spam but keep costs negligible. While Ethereum burns a portion of its fees and pays the rest to miners/validators, XRPL EVM’s fees (denominated in XRP) go to the network validators for now, and are expected to remain very low per transaction, making the chain attractive for both developers and users who have been priced out of Ethereum’s gas fees.

XRPL EVM vs. BNB Smart Chain and Avalanche: Key Comparisons

XRPL EVM enters a competitive landscape of EVM-compatible chains, which already includes platforms like BNB Smart Chain (BSC) and Avalanche C-Chain. All these networks share the ability to run Solidity smart contracts and use familiar Ethereum tooling, but they differ in performance, cost, and ecosystem. Below we compare XRPL EVM with BSC and Avalanche on a few key points:

• Developer Experience: From a developer’s standpoint, XRPL EVM, BSC, and Avalanche all offer a very similar experience. Each is EVM-compatible, meaning developers can write smart contracts in Solidity and use tools like Truffle, Remix, and MetaMask with minimal changes. XRPL EVM was designed to be “Ethereum-equivalent” – developers can migrate Ethereum dApps over with almost no modifications. This is akin to BSC (which famously attracted Ethereum dApp forks like PancakeSwap by offering an Ethereum-like environment with faster/cheaper transactions) and Avalanche’s C-Chain (which also supports Solidity out-of-the-box). One minor difference is how these chains connect to their broader ecosystems: for example, XRPL EVM developers might interact with XRP-specific features (like XRPL’s native DEX or account system) or use bridging tools to tap XRPL mainnet assets, and Avalanche developers can leverage its subnet architecture for custom blockchains. However, in terms of writing and deploying smart contracts, if you know Ethereum, you can quickly get started on XRPL EVM just as easily as on BSC or Avalanche. This low barrier to entry is intentional – Ripple wants to attract the large pool of Ethereum developers to build on XRP’s network. Additionally, XRPL EVM is compatible not only with MetaMask but also with Cosmos ecosystem wallets like Keplr, reflecting its cross-chain DNA. Overall, the developer experience is familiar and straightforward across all three chains, with XRPL EVM offering the bonus of direct XRP integration (which could simplify certain payment-centric dApps).
  

• Transaction Costs and Performance: XRPL EVM distinguishes itself with ultra-low fees and high throughput, in line with XRPL’s ethos. All three chains boast significantly cheaper and faster transactions than Ethereum, but XRPL EVM is pushing the boundary even further. As noted, XRPL EVM transactions typically cost <$0.01 in fees and finalize in about 3–4 seconds. BNB Smart Chain also features low fees (often just a few cents) and fast 3-second blocks, thanks to its Proof-of-Staked-Authority consensus (20+ active validators). Avalanche’s C-Chain similarly offers a few-second finality and usually low fees (a typical swap might be a few cents in AVAX). In terms of throughput, XRPL EVM’s 1,000+ TPS capacity is an ambitious target – likely higher than what BSC handles (BSC has seen a few hundred TPS in practice) and competitive with Avalanche’s capabilities. All three networks can comfortably support common DeFi and gaming applications without the kind of congestion seen on Ethereum L1. It’s worth noting that XRPL EVM’s performance comes partly from its PoA consensus (trusted validators optimize speed), whereas Avalanche uses a more decentralized proof-of-stake with hundreds of validators and an innovative consensus for fast finality, and BSC uses a limited validator set tied to BNB staking. For the average user, these differences manifest in cost and speed: XRPL EVM’s transactions are near-instant and virtually feeless, which lowers the barrier for micro-transactions and high-frequency dApp use. This gives XRPL EVM a competitive edge – it marries the low latency and cost of XRPL (the base ledger can settle payments in ~4 seconds for fractions of a cent) with full smart contract functionality. By contrast, while BSC and Avalanche are inexpensive, XRPL EVM’s fees may undercut even those chains (especially during periods of high activity where BNB or AVAX fees might rise to tens of cents). In summary, all three chains beat Ethereum on cost and speed, but XRPL EVM aims to be among the cheapest and fastest of the EVM lot, making it attractive for both developers (who don’t want users scared off by fees) and users (who can trade and interact freely without worrying about gas costs).
  

• Ecosystem and Integration: BNB Smart Chain and Avalanche have a head start in building out ecosystems, but XRPL EVM brings some unique integration strengths. BSC (now often just called BNB Chain) launched in 2020 and quickly grew a massive ecosystem of DeFi dApps (DEXs like PancakeSwap, lending platforms, NFT marketplaces) by attracting projects and users with low fees and the backing of Binance. It also benefits from Binance’s huge user base – many users can access BSC directly via Binance’s exchange wallet integrations. Avalanche, launched in 2021, carved out its own DeFi community (with platforms like Trader Joe, BENQI, Pangolin, etc.) and introduced subnets allowing custom app-specific blockchains, which broaden its appeal for institutions and gaming projects. Avalanche’s ecosystem also connects to Ethereum through the Avalanche Bridge, and it has been focusing on institutional partnerships as well. In comparison, XRPL EVM is brand new on mainnet (mid-2025), so its native dApp ecosystem is just beginning to sprout. However, it leverages XRP Ledger’s existing community and infrastructure in a significant way. The XRPL has over 6 million wallet accounts and a deep liquidity pool of XRP that can now be tapped by smart contracts. Moreover, XRPL has had a built-in decentralized exchange (order-book based) on its main ledger for nearly a decade, predating many Ethereum DeFi innovations. This means XRPL isn’t starting from zero – there’s already an established network of users, a history of token issuance, and even native DEX functionality that new XRPL EVM dApps can hook into. Early examples of projects deploying on XRPL EVM include a money market (Strobe), a lending protocol (Securd), and a derivatives platform (Vertex), which are poised to leverage XRP liquidity and attract XRPL’s user base.
  

In terms of cross-chain integration, XRPL EVM is arguably ahead of the curve by design. From day one it is interoperable with other chains via Axelar, and soon Wormhole, enabling scenarios like multi-chain dApps and omnichain assets. This is somewhat unique – while BSC and Avalanche can use third-party bridges, XRPL EVM baked interoperability into its architecture (thanks to the Cosmos SDK and IBC support). For instance, an NFT marketplace on XRPL EVM could allow NFTs from Ethereum, BSC, or XRPL itself to be traded in one place.

This kind of out-of-the-box multichain connectivity could attract developers who want their app to span multiple ecosystems. It also means XRPL EVM can integrate with networks like Ethereum, Solana, Avalanche, BNB Chain, Polygon and more through official bridges, potentially giving it one of the broadest reaches. Both BSC and Avalanche have made efforts in multi-chain (BSC is connected to the older Binance Chain and has bridges, Avalanche has subnet interoperability and bridges), but XRPL EVM’s use of Axelar/Wormhole and IBC puts it in a strong position to be a connector chain between ecosystems.

Finally, we should mention regulatory and institutional aspects. XRP (the coin) has an arguably more regulatory-friendly status in certain jurisdictions after lengthy legal proceedings in the U.S., and Ripple positions XRPL as an enterprise-ready blockchain. This compliance focus is reflected in design choices like PoA consensus (with known validators) and partnerships in the banking sector.

Ripple’s “compliance-first approach” and the fact that XRP is considered to have regulatory clarity (it’s one of very few crypto assets with a favorable legal precedent in the U.S.) could make XRPL EVM appealing for institutional use cases. BSC, being tied to Binance, has faced some regulatory scrutiny, and Avalanche, while institutional-friendly, doesn’t have the same history of being designed for cross-border finance as XRP. Thus, XRPL EVM’s edge might not only be technical but also reputational: it combines the trust XRPL built in payments and compliance with the flexibility of Ethereum technology.

This could attract fintech and enterprise developers who want DeFi or tokenization but need a network with a track record in the regulated finance space. In summary, BNB Chain and Avalanche are formidable EVM chains with large ecosystems, but XRPL EVM enters the fray with a unique blend of XRP’s strengths (speed, low cost, large user base, regulatory legitimacy) and a fresh interoperability-driven strategy that could carve out a competitive niche in the multichain future of DeFi.

Conclusion

The launch of the XRPL EVM sidechain marks a major evolution of the XRP Ledger, transforming it from a payments-focused network into a multi-dimensional platform that can run the same smart contracts as Ethereum. By introducing EVM compatibility, Ripple and its partners have effectively bridged two worlds: Ethereum’s world of decentralized apps and XRPL’s world of fast, low-cost transactions.

This development eliminates the old trade-off – XRP holders and developers no longer have to choose between XRPL’s efficiency and Ethereum’s functionality; they can have both. The XRPL EVM Sidechain uses XRP as gas, carries XRP’s liquidity into new arenas, and connects with an array of blockchains via Axelar and Wormhole, signaling a commitment to openness and interoperability.

Will XRP Ledger truly compete with Ethereum? In certain aspects, yes. It now hosts Solidity smart contracts, meaning many Ethereum dApps can be replicated or extended on XRPL with far lower fees and faster execution, which is a strong value proposition. XRPL’s built-in features (like its DEX and issued currencies) combined with EVM capabilities may foster innovative cross-chain DeFi projects that set it apart. That said, XRPL EVM is a sidechain with a permissioned validator set, so it doesn’t yet match Ethereum’s level of decentralization or maturity of ecosystem.

However, this might be a deliberate trade-off to achieve scalability and attract institutional projects in the near term. If adoption grows, we could see XRPL EVM transition to a more decentralized model or simply thrive as a fast settlement network for specific use cases (e.g. FX trading, tokenized assets, regulated DeFi).

In the rapidly evolving multichain landscape of 2025, the XRPL EVM sidechain has positioned XRP Ledger as a credible contender in the smart contract arena – not by copying Ethereum outright, but by playing to XRP’s strengths and integrating with the wider ecosystem. By combining Ethereum’s programmability with XRPL’s performance and reliability, XRP Ledger is making a play to be the go-to network for developers who want the best of both worlds.

Enthusiasts can look forward to a growing XRPL DeFi ecosystem, where you might trade or lend assets at a fraction of a penny in fees, or move your tokens from an Ethereum dApp to an XRPL dApp in one click. In summary, XRPL EVM is expanding what’s possible on XRP Ledger and intensifying the competition among EVM-compatible chains – ultimately a win for users seeking faster, cheaper, and more interconnected blockchain experiences.

Sources: The information in this article was gathered from official XRPL EVM documentation and announcements, as well as multiple reputable news outlets and blockchain research reports, to ensure accuracy and a current (July 2025) perspective.

Key references include the XRPL EVM developer site, Ripple’s press releases and statements, and industry analyses from Crowdfund Insider, CryptoBriefing, CoinDesk, and others that covered the XRPL EVM launch and its implications. These sources collectively verify the technical details and competitive context discussed above.