Ripple’s Chief Technology Officer, David Schwartz is of the view that Ripple’s XRP token is more decentralized than Bitcoin and Ethereum. Schwartz has been very vocal on Twitter ever since he assumed the role of CTO.
His activeness on Twitter had led Ripple’s Chief Market Strategist, Chief Market Strategist to state that Schwartz deserves the title of Chief Tweeter. David Schwartz had earlier published a post on Ripple’s website which talked about the decentralization of the XRP ledger.
According to the blog post, Schwartz stated that:
Bitcoin and Ethereum are currently viewed as the gold standard for decentralization…
Since these blockchains are considered decentralized, then by design, the XRP Ledger is also — if not more so — decentralized than both Bitcoin and Ethereum.
He further noted that the proof of work used by Bitcoin and Ethereum was a great starting point for decentralized systems. It gives miners the incentives to validate transactions.
However, a blockchain’s proof of work over time can become highly centralized as with the case of Bitmain which controls a large chunk of Bitcoin’s hashrate.
He added that Ripple’s ledger operates differently to that. He stated that:
The XRP Ledger uses a consensus protocol that relies on a majority of validators to record and verify transactions without incentivizing any one party (this is one of the main reasons why I began working on XRP Ledger more than six years ago). Validators are different from miners because they aren’t paid when they order and validate transactions.
To validate his argument, he stated that:
Put simply, the XRP Ledger is based on an inherently decentralized, democratic, consensus mechanism — which no one party can control.
In order to get more profits, miners always want the transaction costs to increase. Schwartz pointed out that this desire to increase the cost of each transaction makes the cryptocurrencies less attractive to real-world use cases such as payments.
He added that XRP doesn’t operate that way, stating that:
The XRP Ledger encourages the opposite behavior. Those using XRP and the XRP Ledger are able to make progress without mining, saving significant compute power and time. Also, a built-in system, called fee escalation, is part of its consensus protocol and helps to regulate fees overall. This means lower costs and faster transaction times for XRP compared to other digital assets — the attributes that make it the most useful asset for settlement.
Schwartz also talked about the centralization of Bitcoin. Four mining groups control 58% of the Bitcoin network while only three groups control 57% of Ethereum’s network. This is a huge problem according to him.
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He further pointed out that China accounts for 80% of Bitcoin mining at the moment. All these factors combined put BTC and ETH at risk of manipulation and can be easily disrupted by a government.
Ripple, however, is immune to that. He stated that 80% of all validators on the XRP ledger must be on the entire network for a period of over two weeks so they can support a change before it is approved.
XRP has a total of 150 validators, with Ripple running only 10 of them, a figure that is too low for them to make any changes to the network.
By making all these points, Schwartz has proven that Ripple’s ledger is more decentralized than Bitcoin and Ethereum’s network. With time, the cryptocurrency world might come to realize that Ripple is one of the fastest and most reliable cryptocurrencies in the world.
Weiss Ratings revealed that XRP is the best cryptocurrency to use when transferring funds across exchanges.
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