Many will not even classify XRP as a crypto because of Ripple's control, but they could also claim that the XRP token is more decentralized than BTC
Ripple, and its token, XRP, have faced a constant barrage of criticisms relating to their decentralization of the token over the years. Many cryptocurrency purists have criticized their internal functioning with Ripple, the company, which is clearly responsible for the XRP token and its distribution.
However, this statement was equally denied by those at the head of Ripple; in fact, he even saw the managing director, Brad Garlinghouse, state that the XRP register is indeed more decentralized than both Bitcoin and Ethereum.
Only this statement will get many rare fights, but an inspection and a closer interpretation of what it means to be decentralized might indicate that Ripple has a point. They could argue that they are more decentralized than the other two major cryptocurrencies, based on mining pools.
It is well known that controlling most of the traditional work-proof coin mines, such as Bitcoin and Ethereum, can lead to a 51% attack, which destroys the decentralization of the blockchain and gives full control to a person or group or pool.
Bitcoin has flirted recently with the 51% attack and previously, but for Ripple, it's a different story, as they only have seven percent control over validators. Looking at the interpretation of decentralization, technically there have been more chances that Bitcoin is controlled by a group than Ripple – so it is less decentralized?
To be honest, the idea of decentralization is really questioned, and it's also addictive to interpretation, so the claims made on their side of this fence are debatable, but it's interesting to hear Garlinghouse's thoughts.
"It is very clear that the XRP register is decentralized," said Ripple CEO. "Ripple manages seven validators, or about four percent of all public validators."
"With almost all measures now, XRP Ledger is more decentralized than the Bitcoin register or the Ethereum register, where there is a very small number of miners who control to know well over 50% of the mining power".
It is true that Bitcoin mining has been almost monopolized in the past by people like Antpool, BTC.com and ViaBTC, with Bitmain sometimes having the power to launch a 51% attack, but it never does this way. However, it only shows how much mining has been centralized in Bitcoin.
The subject of Ripple
If it were to base the mining and validation of cryptocurrencies as a determining factor for their centralization, it would be absurd to say that Bitcoin is decentralized.
Ripple, the company, despite having control in several areas of the XRP token, controls only seven percent of its validation. Therefore, on this basis, they have very little control and it should be argued that the XRP is decentralized.
Many of these topics are also based on the algorithms used by these two coins.
Bitcoin and Ethereum use proof of work algorithms. This system rewards miners for transaction validation by paying a commission for their work. This was a good starting point for a decentralized system that incentivates complete strangers to contribute to the greater good of a network and to move forward.
But over time, there have been clear limitations. Blockchains using the job test can be subject to centralized control, where some miners have significant control over the system.
XRP Ledger uses a consent protocol that is based on the majority of validators to record and verify transactions without encouraging a part. Validators are different from miners because they are not paid when ordering and validating transactions.
Today these validators operate all over the world and are managed by a wide range of individuals, institutions, business exchanges and more.
As mentioned, this form of argument regarding decentralization only takes one aspect into consideration. But in this aspect, in fact, Ripple is superior. However, when it comes to purists and believers about how blockchains should work, many have a problem with a company that has token discretion.
Ripple was a currency that differs substantially from most of the top 20 coins by market capitalization – which does not necessarily mean it's wrong or fair, but it's definitely proving that things can be done in different ways in the blockchain space.