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Ripple (XRP) is not a cryptocurrency and is highly centralized in the hands of the company called Ripple. This is the opinion of a cryptocurrency switch that listed XRP on its platform a day ago.
"XRP is not a cryptocurrency"
Ripple CEO Brad Garlinghouse says XRP is "very clearly decentralized," but many others disagree. | Source: Steve Jennings / Getty Images for TechCrunch
The Coinmotion Fellowship, based in Finland, published this article just hours after listing Ripple on its trading platform "XRP is a centralized virtual currency".
This article details the view of trading operators that XRP is not a typical cryptocurrency, is not backed up by a traditional blockchain and is highly centralized in the hands of the parent company, Ripple Labs .
"What you need to know about XRP is that it is not a cryptocurrency in the strict sense of the word … What sets XRP apart from crypto-currency?" currencies, it is that it is not based on the blockchain, that it is not exploited and that it is highly centralized. Ripple Network is a suite of different applications from Ripple Labs. XRP, is the Ripple network currency, used by applications. "
This is a notice that has been circulating for a long time in crypto circles. Every few months, another voice is heard to reveal the "shady truth" that XRP is actually a centralized product.
But the difference is that this time it comes from a voice that has something to lose by making this allegation. Coinmotion has absolutely no interest in spreading FUD about XRP, and the fact that the publication of this blog post coincides with its list of XRP (after the huge demand of Finnish consumers) shows just how much point they must be worried.
"Ripple Labs XRP Controls"
The Finnish crypto exchange claims that Ripple Labs controls XRP. | Source: Shutterstock
The article claims that Ripple (the network) does not use a blockchain to secure transactions, but instead uses a method known as HashTree that is patented by Ripple Labs (the company). From the post office:
"In HashTree, all transactions and balances are combined into one number, so the servers compare themselves to each other to reach a consensus. This type of system is faster than the blockchain, but much more centralized. "
Coinmotion also details the details of XRP's supply statistics (the currency), noting:
"XRP is not exploited like typical crypto-currencies.The 100 billion ripple pieces have already been created.Ripple plans to release about half of them to the markets while retaining the At the moment, there is about 39% ripple in open markets, while Ripple Labs holds 61%. "
According to Coinmotion, controlling XRP in the hands of a single company equates to a monopoly, contrary to the basic tenets of a cryptocurrency such as Bitcoin:
"Ripple Labs also has control over when and when to release new market impacts. This contrasts sharply with how decentralized crypto-currencies work: with Bitcoin, everyone knows and agrees on how new bitcoins are hit. With Ripple, it's the monopoly of Ripple Labs to make the decisions. "
Why could Ripple (XRP) succeed anyway?
The article concludes by suggesting that XRP could still succeed despite the points detailed above. Even though Coinmotion does not consider XRP as a purely crypto or blockchain solution, it still qualifies as a modern fintech solution. The article notes:
"As a centralized system, it could also be easier to access than decentralized blockchain systems. Large institutions such as large corporations and banks are often quite conservative in adapting new systems. A centralized system may seem less daunting than a decentralized system. "
It's a feeling I've expressed and it's an easy feeling to find towards the end of last year, as every week in September and October seemed to be about the introduction of a product by Ripple Labs by financial institutions.
In January of this year, Ripple Labs announced the addition of thirteen other financial institutions to its RippleNet network, bringing the total to over 200. At about the same time, co-founder Jed McCaleb – now of Stellar – has found time to get started. Cryptocurrency competitors, alleging that Tron (TRX) was "just garbage."
Brad Garlinghouse says XRP is "very clearly decentralized"
Regarding the criticism of XRP, Brad Garlinghouse, CEO of Ripple Labs, never deviated from the debate and said in 2018 that even him no control over the XRP ledger:
"It's very clearly decentralized. As CEO of the company, I can not control the XRP ledger. "
Ripple CEO Brad Garlinghouse responds to criticisms that #XRP "It's not decentralized and is not a real cryptocurrency:" It's very clearly decentralized.As CEO of the company, I can not control the XRP ledger. "#SwellbyRipple #Ripple #xtrpthestandard pic.twitter.com/HFanjmJjTV
– ??? (@BankXRP) October 2, 2018
Coinmotion ends with a rather disturbing statement that seems to translate as follows: "If it's not right, it's up to you!"
"Nevertheless, since you asked for it, our dear customer, we have offered you the opportunity to buy and sell XRP on Coinmotion.
Featured image of Shutterstock
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