The XRP community has continually voiced concerns regarding the sluggish growth of XRP to the Ripple CTO, David Schwartz, proposing solutions such as burning the escrowed XRP tokens to potentially boost the cryptocurrency’s value. Consequently, the CTO of Ripple has responded to the community’s fervent calls, providing insights into their suggestions.
Ripple CTO Addresses Community Concerns
An XRP community member with the handle “GDP.Burn the escrow” has voiced out concerns regarding the stagnant growth of XRP, the native token behind the Ripple network. Taking to X (formerly Twitter), the community member directly questioned Ripple’s Chief Technology Officer of Ripple, David Schwartz asking if Ripple’s core business was “dumping?”
In response to the query, Schwartz explained Ripple’s approach to managing XRP and enhancing its value. The CTO revealed that Ripple utilizes only two strategic options, including holding large amounts of XRP or reducing the amount of XRP in circulation. Schwartz confirmed that Ripple initially planned to reduce the network’s XRP holdings expeditiously.
Following this, the XRP community member suggested an alternative solution, proposing burning the XRP tokens in its escrow wallet as a third option. Nevertheless, Schwartz emphasized that burning the escrow would yield no “real benefits.”
Another XRP community member replied to Schwartz saying “So in essence XRP holders are screwed for at least 10 years until the escrow is depleted.”
Countering the statement, Schwartz used the Stellar (XLM) escrow burning event as an example. In November 2019, Stellar burnt approximately 55 billion XLM tokens in an effort to increase the value of the cryptocurrency.
Despite the large-scale token burn, XLM’s price rose to a meager $0.09 at the time before subsequently declining. Schwartz argued that the outcome of the XLM burn event renders the notion of an escrow burn bolstering the price of XRP as “nonsense.”
Token price falls into the hands of bears | Source: XRPUSD on Tradingview.com
Community Grapples With XRP Bearish Concerns
During the discussion concerning burning the XRP tokens held in escrow, an XRP community member asked if the price of XRP is presently bearish or not. The member’s inquiry factored in Ripple’s regulatory developments, the evolving market sentiment towards XRP, and ongoing projects associated with the cryptocurrency.
Addressing the question, Schwartz acknowledged that the XRP market is presently marked by limited confidence. However, he expressed his optimism, highlighting that the cryptocurrency would experience improvement over time as it continues to grow.
Despite achieving regulatory clarity during the ongoing court case between Ripple and the United States Securities and Exchange Commission (SEC), XRP’s price has struggled to rally significantly. Meanwhile, many altcoins including Ethereum and Solana have experienced major price surges fueled by the excitement surrounding the 2024 bull run.
The relatively slow growth has become a cause for concern and frustration among XRP’s dedicated community members, who have long championed the cryptocurrency. As major altcoins ride the bullish tide, the XRP community scrutinizes market dynamics, proposing solutions such as burning the escrow to potentially push the price of XRP upwards.
Featured image from Coinmarketcap, chart from Tradingview.com
