In a recent interview with Gamespot, Microsoft state that they still plan on supporting digital game trades and lending, but only when the time is right.
“We were trying to implement the ability to trade [and] loan digital games with your friends which is something that no one else was doing. I believe, in retrospect that people have calmed down and gone back and actually looked at what we said, people are starting to understand, ‘Wow, they did want actually to allow me to loan and trade’ which other digital ecosystems don’t want to do. And so, yeah, I think we need to do that. That has to be part of the experience. Right now, we’re focused on launch and we switched the program back to discs, because that’s what customers wanted.” says senior director Albert Penello.