One of the issues casting a shadow on the XRP cryptocurrency is just how decentralized it is. After all, Ripple owns the lion’s share of XRP’s supply and relies on the cryptocurrency to power its cross-border payment products. Ripple CTO David Schwartz, however, insists that the blockchain startup is not pulling the strings on the cryptocurrency.
Schwartz participated in a Quora session, saying in response to a question on whether XRP is controlled by Ripple: Schwartz participated in a Quora session, saying in response to a question on whether XRP is controlled by Ripple: “Absolutely not. The XRP Ledger is open source technology with a robust community of developers, so if Ripple were to vanish, XRP and the XRP Ledger will remain.”
Schwartz’s defense of XRP being separate from Ripple is three-pronged:
Utility — XRP fuels payments and can do so with or without Ripple’s products.
Ownership – Investors who hold XRP do not own any equity in Ripple.
Decentralization – Ripple runs fewer than 10 of more than 750 validators that authenticate transactions on the XRP ledger.
The Ripple CTO goes on to explain how “IBM, SWIFT, and the rest of the old guard attempt innovation with blockchain but do not solve the centralization issue.” In Big Blue’s case, the tech company is responsible for approving validators on Stellar, which gives it control of the network.
Schwartz, who was part of a trio that created XRP in 2011, went on to criticize “centralized stablecoins” for bank transactions, suggesting that a USD-backed stablecoin doesn’t have the potential to achieve mass adoption. IBM recently announced the addition of six international banks that will use the Stellar blockchain for stablecoin and XLM-fueled payments. Of course, Ripple execs have to downplay these products as they are competition for the blockchain startup’s XRP-powered cross-border payment products, as is JPMorgan’s JPM Coin.
Does Ripple Control XRP? ‘Absolutely Not’, Insists Ripple CTO, CCN, Apr 02