The recently established XRP Ledger Foundation aims to promote the expansion and adaptation of the XRP ecosystem. A task, which so far has been the main focus of Ripple.
The establishment of the XRP Ledger Foundation (XRPLF) has prompted speculation about a possible withdrawal of the Californian FinTechs Ripple from the XRP ecosystem. A spokesperson for the foundation has now denied such Ripple efforts to the Forbes news portal.
The XRP Ledger Foundation was launched on September 24. It sees itself as an independent organization dedicated to the maintenance and development of the XRP Ledger (XRPL), the home of the ripple coin XRP. This includes the technological development of the XRP Ledger as well as the creation of criteria for network nodes that can be used as so-called Validator Nodes for the confirmation of transactions in the XRPL. The Foundation intends to use these criteria to create its own Unique Nodes List (UNL): A recommendation list of trusted validator nodes.
The Foundation does, however, fish in Ripple waters. Despite all attempts to distance the FinTech still has a significant influence on the XRP Ledger. For one thing, Ripple itself operates numerous validator nodes in the XRPL. On the other hand, although it is already possible to create your own UNLs, Ripple controls the composition of the standard UNL, which most nodes use.
In addition, Ripple still controls over 50 percent of all XRP units. Out of 100 billion XRP, 45.1 billion are in circulation. FinTech itself holds 6.2 billion, the rest is held in so-called escrow wallets. In 2017 Ripple set up 55 such wallets, each filled with one billion XRP. Since then, one billion XRP per month has been released for circulation – for 55 months. The part of it that does not find a buyer – usually the majority – goes back into a new escrow wallet. In the first quarter of 2020, 2.6 billion of the 3 billion XRP released for circulation flowed back into escrow wallets. This circumstance ensures that Ripple – or XRP – regularly faces accusations of centralization.
XRP decentralization light
In this context, the establishment of the XRP Ledger Foundation can be interpreted as a step towards a decentralized network – at least according to the interpretation of David Schwartz, CTO of Ripple.
We and the community have worked over the past 8 years to dramatically increase the decentralization, performance, and feature set of the XRP ledger, and we will continue to work to drive its growth and innovation under Foundation leadership.
Lets quote Schwarz in the press release on the launch of the XRP Ledger Foundation. The latter received a financial start-up grant of 6.5 million US dollars from Ripple, Coil and GateHub.
Ripple should continue to play a key role
Rumors that Ripple – which still employs a core development team for the XRP protocol – plans to outsource XRPL development entirely, Bharath Chari, spokesman for the XRP Ledger Foundation, tells Forbes no.
We believe that this is not the case at all, although this question is better answered by Ripple. As with many open source projects, the companies involved invest time and resources to help with development. The XRPLF continues to see Ripple as a key developer in both the technical and business aspects of XRPL. In addition, the XRPLF is just one institution that promises to act in the best interests of the XRPL. It is not about controlling an open, decentralized ecosystem like XRPL,
said the foundation spokesman in the Forbes interview. Chari also believes that concerns that the XRPLF could influence network governance through its own UNL – for example, by giving members on the Foundation Council a better chance of getting a place on the UNL – are unfounded:
Any overlap [between XRPLF Council and UNL] will be random and in no way forced. The main criteria for inclusion in the UNL, as published by us, would be based not only on ecosystem participation, but also on hard technical evidence that they are capable of meeting the stringent requirements of maintaining high approval rates.
At least one overlap already exists between the XRPLF and the UNL defined by Ripple. XRPL developer Wietse Wind, who among other things created the XRP TipBot, operates one of the 35 validator nodes that set the tone on the XRPL.
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