David Schwartz Discusses 'Bottom-Up Growth' of XRP Ledger, Counters Criticism

• David Schwartz, CTO of Ripple Labs, on Crypto Regulation and Developer Adoption
• Ripple Labs' SEC Case: What It Means for Adoption
• Impact of Ripple's SEC Case on Customer Acquisition
• New Feature 'Hooks': Enabling Smart Contract Functionality
• Challenges of Ripple's Enthusiastic Fan Base
• Ripple's Place in the Developer Conversation
• Multi-chain Crypto Ecosystem: XRP Ledger as a Payments Pioneer
• Ripple's Strategy Amid Crypto Libertarianism
• Addressing Centralization Criticisms

David Schwartz, CTO of Ripple Labs, on Crypto Regulation and Developer Adoption

David Schwartz, CTO of Ripple Labs, is a highly respected figure within the cryptocurrency industry, regarded highly among followers of Ripple's native cryptocurrency, XRP$0.620 -1.68%. However, the XRP Ledger, Ripple Labs' blockchain, has been subject to criticism from Bitcoin$42,260 -0.64% and Ethereum$2,315 -2.42% enthusiasts as well as the U.S. Securities and Exchange Commission (SEC).

Ripple Labs' SEC Case: What It Means for Adoption

Six months ago, Ripple Labs triumphed in its extended legal battle against the SEC, ending years of uncertainty for the company. This lawsuit had made it challenging for Ripple Labs to attract banks and other customers to its platform, RippleNet- an institution-focused cross-border payments platform powered by the XRP Ledger and XRP cryptocurrency. However, it wasn't just the legal issues that slowed down adoption. Since its inception, Ripple and the XRP Ledger have struggled to captivate the developer community in the same way that Bitcoin, Ethereum and other main crypto platforms have. Ripple's legal victory could attract more developers to its platform.

Impact of Ripple's SEC Case on Customer Acquisition

Schwartz acknowledged that a significant impact of the SEC case was seen when exchanges started delisting XRP. RippleNet, however, saw minimal impact as most of their deals were not based in the U.S., with the notable exception being MoneyGram. Most of the intriguing volume is from the Asia Pacific and Middle East regions.

New Feature 'Hooks': Enabling Smart Contract Functionality

Ripple has been testing out a new feature called 'Hooks' that could introduce smart contract-like functionality to the XRP Ledger. While Ripple Labs itself didn't play a significant role in the development of Hooks, the team did express their support. This major change doesn't come without risks, such as potentially damaging the XRP Ledger and disturbing the network. However, if successful, it could add value to the XRP Ledger network.

Challenges of Ripple's Enthusiastic Fan Base

Having a passionate fan base can be a double-edged sword, Schwartz said, comparing Ripple's devoted fans to those of companies like Tesla and Apple. While the support can be encouraging, it can also sometimes spiral into unwarranted expectations and uncorroborated speculations which can reflect negatively on the company's efforts to build and be constructive. Striking a balance between engaging and not engaging with fans can be challenging for the company.

Ripple's Place in the Developer Conversation

When it comes to attracting developers, Ripple has had less success than platforms like Bitcoin and Ethereum. Bitcoin initially attracted developers as it was the first of its kind, while Ethereum reeled in developers with its flexibility to build anything on its platform. The XRP Ledger, in contrast, appears less attractive to developers due to its fixed functions. Despite being well-suited for its use cases, it has ironically made it more challenging to attract developers.

Multi-chain Crypto Ecosystem: XRP Ledger as a Payments Pioneer

Schwartz believes that the XRP Ledger should dominate cross-currency payments and liquidity provision, given that it was specifically built and optimized for this use case. However, he also sees potential for an ecosystem to evolve around XRP Ledger for smart contract chains, real-world asset tokenization, carbon markets, tokenized securities, stablecoins, and more.

Ripple's Strategy Amid Crypto Libertarianism

While there's a vocal libertarian faction in the crypto world that opposes blockchain being used in government-backed Central Bank Digital Currencies (CBDCs), Schwartz points out the potential for due process rights when the government runs things. He argues that in a government-operated system, there would be rights to challenge actions and decisions in court, a benefit not always available in a privately owned system.

Addressing Centralization Criticisms

Responding to criticisms that Ripple is more centralized than other blockchains, Schwartz stated that as the world has become more hospitable to different consensus mechanisms, people have found that these technologies work just fine. He pointed out that the function of the blockchain's consensus method is to agree on a transaction order, and the XRP ledger is designed to do just that.

Edited by Jonathan Stoker