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Saturday, April 13, 2024

XRP Myths: Expert Corrects Three Misconception About Ripple

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An illuminating conversation unfolded on X this week about XRP Ledger’s smart contract features. A Ripple expert corrected some misconceptions that Ripple is not as feature-rich as its competitors.

Are Ripple Use Cases Limited?

If you ask Google Bard or any AI chatbot why XRP price hasn’t shown the kind of gains Bitcoin (BTC) and Solana (SOL) have this year, it might tell you it’s because Ripple doesn’t have as many use cases:

“While XRP is initially designed for fast and cheap cross-border payments, its use case hasn’t evolved or broadened significantly.

Other competitors like Ethereum and BNB Chain offer a wider range of functionalities like smart contracts and decentralized finance (DeFi), which might attract more user interest and drive price appreciation.” – Google Bard, Dec. 2023

This is a common misconception about Ripple. But a recent conversation thread with XRPL Labs founder Wietse Wind on X, formerly Twitter, set the record straight.

Three Myths About XRP Corrected

An X.com user wrote a harsh critique of XRP Ledger on Wednesday:

“And it’s failed horribly, unbelievable XRPL has been around since 2014 and is so far behind other blockchains.”

In response, the CTO at XRPL Labs asked:

“Genuine question: If you could have 5-10 things added to the XRPL, that other chains already have, what would those be?”

In reply to some of the answers, XRPL founder Wietse Wind cleared up some of the misconceptions markets and cryptocurrency communities online still have about Ripple.

Myth #1. XRPL is Centralized

While some have claimed that XRPL is centralized because RippleNet works by API rather than a consensus mechanism, XRP Ledger is, in fact, decentralized. It uses a hash-based consensus mechanism via a network of trusted node validators.

Myth #2. XRP Lacks Smart Contract / DeFi Capabilities

The XRP Ledger protocol does allow for token issuance, programmable money, smart contracts, and decentralized finance applications (DApps) such as decentralized exchanges (DEX).

Myth #3. There’s Regulatory Uncertainty Around XRP

After multiple court victories for Ripple Labs against the Securities and Exchange Commission this year, Wietse said in the discussion thread that this is “mostly irrelevant” to the value that XRP provides.

Ripple is currently in the remedies phase of the trial and may settle with the SEC. But it could fight all the way to the Supreme Court.

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