By Sohrab Khawas
Ripple’s Chief Technology Officer (CTO), David Schwartz has confirmed that the majority of the company’s revenue comes from selling its XRP holdings. In a recent Twitter exchange, Schwartz explained that this approach not only generates revenue for Ripple but also contributes to decentralization by reducing the company’s XRP holdings.
Clarifying Misinformation about XRP
The Twitter conversation began when a user with the handle @/ScamDetective5 asked Schwartz to address some misconceptions regarding XRP. The CTO obliged and provided a series of clarifications on various topics related to the digital asset and RippleNet.
Sure.
1. XRPL certainly needs the Internet for now and the foreseeable future.
2. No CBDCs on XRPL right now. …
— David “JoelKatz” Schwartz (@JoelKatz) April 13, 2023
Schwartz acknowledged that the XRP Ledger (XRPL) is dependent on the internet for the time being and the foreseeable future. He also confirmed that there are no Central Bank Digital Currencies (CBDCs) on the XRPL at the moment.
Regarding transaction processing, Schwartz admitted that the live XRPL has never seen 1,500 transactions per second (TPS). He estimates that the current configuration could likely sustain between 300-500 TPS.
The CTO clarified that RippleNet does not use On-Demand Liquidity (ODL) and that proposals to allow it all include new sources of liquidity. While he is unsure of the exact percentage of RippleNet volume attributed to ODL, he stated that hearing it was 60 per cent would not surprise him.
Circulating Supply Growth and XRP Sales; No Higher-Priced XRP
Schwartz next confirmed that the circulating supply of XRP is indeed growing, similar to other cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH). He also addressed the topic of XRP sales, stating that if “sell” is broadly defined, then selling XRP accounts for most of Ripple’s revenue.
The Ripple expert explained that the company’s options are either to sell or hold XRP, and many people believe Ripple holds too much of the digital asset. By strategically selling XRP, the company can reduce its holdings and contribute to decentralization.
Finally, Schwartz debunked the notion of a higher-priced XRP existing elsewhere. He argued that if such an XRP could not be easily exchanged for XRP on the XRPL, there would be no reason to call it XRP. Furthermore, if it could be exchanged, nobody would pay substantially more for it unless they were “really dumb.”
