XRPL governance faces renewed scrutiny as Ripple’s CTO, David Schwartz, addresses concerns regarding account reserves and the network’s voting mechanism.
Schwartz emphasized that XRPL’s voting system primarily coordinates feature activation rather than serving as the network’s primary governance tool. This discussion arises amidst heightened investor interest in XRP, driven by Ripple’s upcoming RLUSD stablecoin launch and a surge in XRPL activity.
Ripple CTO highlights voting system concerns
David Schwartz recently shared insights into the XRPL voting mechanism, focusing on how it influences reserve changes. He clarified that while voting can determine reserve adjustments, it is limited to active validators. Schwartz warned that inactive validators may impact decision-making, potentially destabilizing the process. To address this, he suggested two key improvements.
The first proposal requires explicit configurations for voting to increase reserves, with the default setting remaining inactive. The second involves setting no default preference regarding reserve levels, allowing changes only when explicitly configured. Schwartz acknowledged the recent reserve reduction was overdue but suggested it was more aggressive than ideal. He reassured users that lowering reserves unlocks XRP for all accounts without removing or losing funds while cautioning that increasing reserves could unintentionally lock XRP and cause concerns over undue influence.
Validators’ role in protecting the network
Daniel Keller, who identifies as the XRPL’s CEO, responded to Schwartz’s comments by emphasizing the critical role of validators in safeguarding the network. He stressed that validators act as a defense against hasty decisions, referencing past challenges like the XLS-20 rollout and premature automated market maker (AMM) proposals. Keller’s remarks reinforced the need for caution and consensus in governance decisions to avoid potential setbacks.
RLUSD stablecoin launch boosts XRP momentum
Investor excitement around Ripple’s RLUSD stablecoin launch has significantly increased activity on the XRP Ledger. Ripple announced that RLUSD will be introduced globally on December 17, 2024, following regulatory approval from the New York Department of Financial Services (NYDFS). The stablecoin launch is made possible through Ripple’s acquisition of Standard Custody, which will oversee RLUSD distribution to key exchanges.
As the CEO of the XRPL I want to share my thoughts on this comment and matter as well.Validators are the last bastion to defend the network from bad decisions, and given the history of the previous two years, we have learned that this is necessary. Who doesn't remember the… https://t.co/YcIRsIIN65
— Daniel "Wen DexTools" Keller (@daniel_wwf) December 17, 2024
Ripple CEO Brad Garlinghouse highlighted RLUSD’s compliance with regulations and its potential for widespread adoption as U.S. crypto policies clarify. The stablecoin is expected to be available on platforms including Archax, Bitso, CoinMENA, MoonPay, and Uphold.
XRP’s price has surged by 16% in the past week, contributing to an impressive 366% gain over the last 60 days. XRP now ranks as the third-largest cryptocurrency, with a market capitalization exceeding $147 billion. At the time of writing, XRP trades at an average price of $2.57, with a 24-hour trading volume of $13.96 billion, marking a 111% increase. As Ripple prepares for RLUSD’s launch, discussions surrounding XRPL’s governance and reserve system remain central to ensuring the network’s stability and long-term success.
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