As the crypto market prepares for a new season of growth, XRP has opted to reduce its reserves 10 times lower. The current adjustment reflects a decrease to $2.64 from $26.40. This presents an opportunity for new network users to fund their wallets with a smaller amount of crypto, thereby attracting a larger user base.
The modification was applied to XRP Labs nodes on October 16. However, adjusting the reserve requirement required a validator reset and a consensus vote from all validators, which only took place yesterday.
Developers have said that the high reserve of 10 XRP has slowed down the network’s uptake, which was not why they made it high. They explained that the high reserve was meant to keep the record from getting too big for the nodes to store. They also wanted to stop people from making fake accounts with little to no XRP, so they made the 10 XRP reserve minimum.
1 XRP instead of 10 XRP – The details
On December 2, blockchain data shows that XRP Ledger cut the base reserve needs from 10 XRP to just 1 XRP. This allows new network users to fund their wallets with less crypto, which could make it easier for more people to join. It also lets people spend some XRP that they would have had to save up before.
XRP account reserve requirements
The ledger developer WietseWind said, “The number one concern would be increased activity on the ledger to the point where it becomes a challenge for infrastructure.” He said that it was a good problem that they could handle. He also claimed that engineers would develop means to accommodate the extra strain on the network and could manage it.
The change happened on 2nd December on the XRP ledger website. An XRP holder showed in an X post that owner reserves had gone down from 2 XRP ($5.12) to 0.2 XRP ($0.51). This means that users only need to hold on to 0.2 XRP for each item they own.
XRP Ledger papers say that objects can be trust lines, signer lists, non-fungible tokens (NFTs), or owner directories. Some oracles are also things that need to be reserved by their owners.
XRP prepares for a seamless flight
For a long time, Ripple Labs, the development team behind XRP, has conflicted with the US Securities and Exchange Commission (SEC). Ripple denies that XRP is a security and that the SEC should have registered it, but the SEC maintains that it is. Ripple is appealing the decision that penalized them $125 million in the lawsuit.
Ripple CEO Brad Garlinghose said that XRP would have done better than Bitcoin if it had not been for the SEC’s distractions. Paul Atkins, the most highly anticipated SEC candidate, is one that crypto entities believe would give them an easy time.
The decision to cut reserve requirements comes at a time when the XRP Ledger native coin is experiencing significant growth. Before Donald Trump was elected US president, XRP was worth less than a cent per coin.
However, since the election, it has increased to $2.65, jumping 435% in 30 days to reach its highest level since February 2018. Large holders are significantly influencing this move.
According to on-chain data, XRP has gone up 14% in the last 24 hours, doing better than Bitcoin and all the other big cryptos. Over the weekend, the token quickly beat Solana’s SOL and tether (USDT), and as of Tuesday, it was the third-largest token by market cap.
In addition, XRP trading volume has also been reported to have hit $3.7 billion on the South Korean crypto Exchange – Upbit. Trading volumes of XRP tokens against the Korean won hit $3.7 billion on Upbit in the last 24 hours.
With Trump entering office in 2025, Ripple will be more eligible to compete with other crypto companies without any distractions. Kain Warwick asserted that the crypto space has a four-year window to expand to a scale that makes it resistant to anyone shutting it down.
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