DepositAuth Amendment: Controlling Incoming Transactions on the XRP Ledger

Depositauth Amendment
Depositauth Amendment

The DepositAuth Amendment, recognized by Amendment ID F64E1EABBE79D55B3BB82020516CEC2C582A98A6BFE20FBE9BB6A0D233418064, introduces a powerful tool for account management on the XRP Ledger. This amendment adds an account flag, DepositAuth, enabling accounts to exercise strict control over incoming transactions. This feature is particularly useful for businesses and entities that must adhere to rigorous regulatory compliance standards, ensuring due diligence before accepting funds from any source.

Key Features of the DepositAuth Amendment:

1. DepositAuth Account Flag:

  • The primary feature of this amendment is the introduction of the DepositAuth account flag.
  • When activated, this flag allows an account to strictly reject incoming money from transactions initiated by other accounts.

2. Enhanced Regulatory Compliance:

  • Businesses and organizations can use the DepositAuth flag to adhere to strict regulations that necessitate thorough due diligence before accepting funds from any source.

3. Transaction Failures for Restricted Accounts:

  • Transactions targeting an account with DepositAuth enabled will fail if that account is the intended destination, regardless of whether the transaction involves XRP or tokens.

4. Exception for Small XRP Amounts:

  • Accounts with DepositAuth enabled may still receive Payment transactions involving small amounts of XRP (equal to or less than the minimum account reserve), provided that their current XRP balance falls below the account reserve.

5. Bug Fixes:

  • The DepositAuth Amendment also addresses a bug related to EscrowCreate and PaymentChannelCreate transactions.
  • These transactions mistakenly enforced the Disallow XRP flag, which was intended to be a non-binding advisory flag.

The DepositAuth Amendment offers enhanced control and regulatory compliance capabilities for accounts on the XRP Ledger. With the DepositAuth account flag, businesses and organizations can strictly manage incoming transactions, ensuring they comply with stringent regulatory requirements. This feature provides a valuable tool for entities that must exercise due diligence before accepting funds from any source. Additionally, the amendment includes bug fixes related to the Disallow XRP flag, improving the overall transaction processing experience on the XRP Ledger.

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