Ripple Labs has defended its native XRP token against charges of being a security for a while now. More investors are confident that the SEC will consider XRP to be a security thanks to its seemingly centralized design.
David Schwartz, Ripple's Chief Technology Officer, seems to have had enough of this and wanted to settle things once and for all.
Addressing the theme of decentralization
By definition, decentralization means "dispersion or distribution of functions and powers". In the cryptosphere, however, it is less clear what it means to be decentralized.
David Schwartz says in the opening of his new report that the term "is wildly blurred, misunderstood and, frankly, evolving."
In his report, entitled "The Inherently Decentralized Nature of XRP Ledger", he tries to clarify some of the confusion surrounding the decentralization of XRP.
Bitcoin and Ethereum use labor-testing algorithms and reward miners for transaction validation and XRP uses a consent protocol that requires validators to record and verify transactions without any incentive.
According to Schwartz, these validators are widespread throughout the world and include more individuals, crypto-exchanges and institutions.
"Put simply, the Led XRP register is based on an intrinsically decentralized, democratic system, a consensus mechanism – that no party can control," explains Schwartz.
Brad Garlinghouse, CEO of Ripple, showed his approval of Schwartz's post on Twitter and promised even more data about the issue during his Ask Me Anything session.
. @joelkatz talks about the truth about XRP Ledger! Designed brilliantly to be intrinsically decentralized. More information on this during my AMA with @CoryTV at 3 pm (PT) today on https://t.co/OmzfxkPL6N https://t.co/IIcdA75bIt
– Brad Garlinghouse (@bgarlinghouse) August 22, 2018
XRP is more decentralized than Bitcoin and Ethereum
Schwartz says both Bitcoin and Ethereum are less decentralized than Ripple's XRP because Bitcoin has four large mining pools that control 58 % of BTC and Ethereum has three large mining basins that control 57% of ETH.
And whereas the fact that the SEC has stated that neither Bitcoin nor Ethereum are titles due to the lack of a central governmental organization controlling them, it would be fair that XRP is classified as non-security.
Schwartz continues and explains that the most critical reason why XRP is "decentralized in nature" is the fact that users on the XRP register select a Unique Node List (UNL) which is a list of trusted validators chosen by the & rsquo; user.
Users ar & # 39; free to choose and even change their UNL, and this means that the XRP register "is and has always been intrinsically decentralized". according to Schwartz.
We will probably hear / read more about this controversial topic in the future as well.