Ripple’s XRP: A Token Beyond Control

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David Schwartz, that paragon of cryptographic wisdom, has taken up his quill to dispel the fog of misunderstanding surrounding the XRP Ledger’s arcane mechanisms.

He has penned a manifesto detailing why the network’s native token, XRP, is not the squire of blockchain security, but rather a mere spectator in the grand ballet of consensus.

Why XRP is not used for consensus 

An inquisitive soul, armed with a keyboard and a penchant for confusion, questioned Schwartz’s prior musings comparing the ancient rites of proof of work, the modern-day alchemy of proof of stake, and the enigmatic dance of the XRPL.

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Schwartz had once mused that the XRPL thrives on “stakeholder chosen scarcity.” For contrast, PoW relies on the sweat of miners, and PoS on the gilded chains of token value.

The inquisitor wondered if XRP itself was the asset “chosen” to be scarce in this model. Schwartz, ever the diplomat, swiftly corrected this heresy.

He explained that the token plays no role in consensus, and here’s why: first, when the XRPL was conceived, proof of stake was still a secret whispered in the shadows of academia, and the developers were too busy sipping tea to invent it. Second, using XRP for consensus would have handed Ripple a crown of control, which, as any self-respecting decentralist knows, is a fate worse than a poorly designed smart contract.

The XRPL, Schwartz claims, is a garden where participants choose validators they believe are tending the soil of trust. A democracy of nodes, if you will-though with fewer debates and more cryptographic signatures.

The best incentive is no incentive 

In a 2020 lecture, Schwartz lamented that artificial financial rewards are the plague of blockchain, turning users into mercenaries rather than stewards. He argued that “eventual consistency” is the lifeblood of blockchains, but paying exorbitant fees to achieve it is like hiring a scribe to transcribe a poem-expensive, inefficient, and entirely missing the point.

Schwartz, ever the purist, views mining and staking rewards as a curse: “artificial incentives are attacks on the natural stakeholders, and they represent friction left in the system.” As he put it, “natural incentives decentralize the only reason to participate in the system is because you want the system to work reliably there is nothing for you to take from the system.”

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2026-05-13 08:51