Ripple’s CTO David Schwartz Discusses XRP Pricing on Social Media
In a recent social media discussion, Ripple’s Chief Technology Officer, David Schwartz, shared his insights regarding the valuation of XRP, the cryptocurrency associated with Ripple. He made it clear that he holds XRP and if there was a way to increase its price, he would certainly do so.
XRP’s Pricing Debate
During the online conversation, another user pointed out that even after seven years, XRP remains relatively affordable. In response, Schwartz dismissed the notion that XRP could be considered “dirt cheap.” He explained, “It can’t be dirt cheap. That doesn’t make any sense. If XRP costs $1, they’d need a million XRP which would cost $1 million. If XRP cost a million dollars, they’d need one XRP which would, again, cost $1 million.”
David Schwartz elaborated on the concept, stating that regardless of the price of XRP, the cost of making a $1 million payment with XRP would still amount to $1 million. This is because the value needed for the transaction remains consistent, irrespective of the individual token price.
The Impact of Low XRP Prices on Payments
Schwartz also highlighted a crucial point: lower XRP prices can actually make payments more expensive. He drew a comparison to Bitcoin, explaining that when Bitcoin was valued at $300, it was impractical to use it for large purchases like buying a house. As Bitcoin’s value increased, it became more feasible for such significant transactions. Similarly, lower XRP prices make payments less efficient and more costly from an institutional standpoint. He emphasized, “That won’t make your payments any cheaper. It’ll just mean that buying and selling the same value of XRP moves the market against you more, making payments even more expensive.”
The Current State of Cryptocurrency Payments
David Schwartz shared his thoughts on the usage of cryptocurrencies like XRP for payments. He pointed out that the adoption of cryptocurrencies for payment purposes is still limited. Despite XRP being widely available, ranking in the top five by market size, and offering low fees combined with fast transaction times, it is not extensively used for payments. According to Schwartz, the reasons hindering XRP’s use for payments are similar to those affecting other cryptocurrencies.
In summary, while XRP holds significant potential due to its low transaction costs and quick processing times, its usage in payment systems remains constrained by broader issues affecting the cryptocurrency market. Schwartz’s insights provide a deeper understanding of the challenges faced by cryptocurrencies in achieving widespread adoption as a payment method.
