David Schwartz, the chief technology officer (CTO) of the crypto solutions company and cross-border payment firm Ripple has made clarifications regarding the relationship between XRP and Ripple.
According to Schwartz, the changes that were introduced to the XRP Ledger’s (XRPL) system rules and operations by Ripple did not result in the creation of a new version of XRP.
The topic of XRP, the sixth-largest cryptocurrency by market capitalization, being created by Ripple resurfaced on Twitter on Sunday following a comment from DS, the founder of the Metaverse project xSpectar. DS took to Twitter to point out a well-known fact that the United States Securities and Exchange Commission (SEC) has chosen to ignore in its ongoing lawsuit against Ripple.
DS tweeted, “Remember, XRP was created before its founders built Ripple. A simple and glaring fact which the SEC chooses to ignore.” Responding to this post, an industry expert with the pseudonym Scam Detective reshared a thread he published in 2022 that contended that the XRPL native currency XRP was created by the Silicon Valley technology company Ripple.
Schwartz immediately reacted, emphasizing that the company Ripple isn’t the creator of the crypto asset XRP. The idea behind the claims from Scam Detective made no sense, the CTO said, citing the creation of the Bitcoin Cash (BCH) project and Ethereum’s transition to proof of stake.
Schwartz wrote, “The entire logic behind this is nonsensical. When bitcoin cash was created, there were lots of people who already had it, and it wasn’t because anyone connected to bitcoin cash in any way created it or gave it to them.”
“People held assets that became bitcoin cash before anyone even had the idea to fork bitcoin into bitcoin cash. Do changes in system rules or operations create new versions of existing assets?”
That's not an unamibiguous question. People held assets that became bitcoin cash before anyone even had the idea to fork bitcoin into bitcoin cash. Do changes in system rules or operations create new versions of existing assets?
— David "JoelKatz" Schwartz (@JoelKatz) June 5, 2023
Notably, former Ripple CTO Jed McCaleb restarted the XRP Ledger in 2012 which introduced changes in the network’s rules and accounting systems, taking out the older rules and systems. This also resulted in the loss of the first 32,569 blocks on the XRP Ledger. Contrary to claims that this incident recreated all XRP tokens, Schwartz noted that nothing of such happened, citing Ethereum’s transition to a proof of stake blockchain.
He wrote, “When Ethereum switched to proof of stake, did that somehow “issue” all the Ethereum that existed both before and after the new system launched? Was all Ethereum that will ever be mined created when the chain launched?”
In addition, Schwartz noted that no new tokens were created when the Bitcoin blockchain was forked.
“Remember when Bitcoin forked into Bitcoin and bitcoin cash? It was entirely possible at the time that one side would have died out and the other just been “bitcoin”. Regardless of which side survived and which died off, no rational person would have claimed that was the birth of bitcoin or that bitcoin was issued in that process.”
“Yes, we now think of it as a new cryptocurrency having been launched that we now call bitcoin cash. But no new currency was created by the fork itself, just as none would have been if one side had died off.”
Overall, it is worth noting that Ripple and XRP are two different entities. Some of the founders of XRP only happen to be co-founders of Ripple, the San Francisco-based cross-border payment firm.
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