Ripple’s XRP cryptocurrency is under pressure along with the rest of the cryptocurrency market. The third largest cryptocurrency by market capitalization is struggling to hold on to the $3 valuation as criticism regarding the centralization of its ledger technology mounts. The situation has added complexity to the ongoing debate around whether or not it could potentially be added to the much-hyped US crypto reserve in the future.
Ripple Technology Czar Dismisses Centralization Concerns
Ripple’s Chief Technology Officer (CTO) David Schwartz has defended the platform’s ledger (XRPL) and argued that its extensive structure and decentralization mechanism defend it against price manipulation.
He stated that this was just another ploy by naysayers to discredit the widely successful cryptocurrency and its rapidly reviving fortunes.
XRP Cite Centralization Fears Yet Again
Critics, led by Bitcoin maximalists, believe that the innate centralization of Ripple’s ledger makes it vulnerable to organizational influence. Pierre Rochard, the Vice President of Research at Riot Platforms, tweeted that the company could directly manipulate the XRPL software, adjust escrow locks, or flood the market with additional XRP.
Rochard argued that XRP uses a simple consensus algorithm rather than a rigorous Proof of Work (PoW) regime like Bitcoin. As a result, there are fewer validators than Bitcoin, and there is no incentive to maintain the ledger’s integrity, which Ripple’s higher-ups can easily manipulate.
Ripple’s Storied Past
This is not the first time Ripple has been accused of centralization. The controversial digital asset has been criticized for this approach for the better part of the 10 years of its existence.
Fiercely loyal Bitcoin users see Ripple as a corporate distraction that has nothing to do with blockchain or even decentralization and brings nothing to the table.
Will XRP be Part of the US Strategic Crypto Reserve?
Ripple CEO Brad Garlinghouse has also dismissed these concerns and stated that the company is in a good position to take advantage of the pro-crypto stance of the new Donald Trump administration. He also cited Trump’s policy of promoting American blockchain firms, which could pave the way for XRP to be included in the strategic reserve asset announced by Trump on his campaign trail.
While the debate around its inclusion in the reserve continues, Ripple’s digital currency has been doing extremely well in the last few months, rising 600% in the previous few months. The recent 10% fall from its 7-year high of $3.3 can mostly be attributed to the recent slump in the crypto market that has wiped out $1 billion in derivatives in the last 24 hours alone.
