Ripple's chief technology officer, David Schwartz, gave his opinion on how the company could have managed its massive amounts of XRP.
Schwartz responded to a cryptocurrency enthusiast on Twitter who believes Ripple's “biggest sin” was the way the company managed its holdings of more than half of the total XRP supply.
What do you think we should have done? As soon as there was a market price, giveaways stopped working.— David Schwartz (@JoelKatz) December 28, 2020
The former XRP fan called the technology "wasted potential" and said that Ripple holding more than 55 billion units of the token was "a sign of greed". The number of tokens insured by Ripple is so large that only with the devaluation of the token did the company feel a loss of US $ 15.5 billion.
Ripple's CTO answered:
“What do you think we should have done? As soon as there was a market price, the distributions stopped working … In the beginning, we were donating. Everyone I wanted was using it. But, since it had a market price, the gifts were only handled by people who immediately sold them and caused enormous collateral damage. ”
When questioned if Ripple should have committed his XRP directly to the development of the XRP Ledger itself, Schwartz questioned the amount of risk involved in such a move.
“At that time, we would have no idea what to do. You are imagining that we somehow committed to immutable rules too early, at the risk of being wrong. ”
As to whether he feels good about how XRP was used, Schwartz said who thinks Ripple has done a good but not perfect job of managing its holdings.
“I think we faced some unprecedented challenges and we did a good job overall. Imperfect. I don't think making big irrevocable commitments earlier would help and it definitely didn't seem prudent at the time. The biggest problem was that we didn't want to keep XRP forever, but donating it became impossible. It was a bizarre challenge. Blockages also don't work very well. ”
The U.S. Securities and Exchange Commission (SEC) accuses Ripple of illegally selling XRP as an unregistered security from 2013 to the present day. An initial pre-trial conference is scheduled for February 22.
The chief technology officer also used his Twitter to criticize the SEC lawsuit, saying:
“The United States is one of the few countries where regulators, after years of operating in broad daylight and frequently updating them on everything you’re doing, turn around and say you should know you’ve been breaking old laws all along this time."
See also: Leaked document reveals that Ripple ignored legal advice
Invest in cryptocurrencies with security, high liquidity and the lowest rates in the market.
NovaDAX: the most complete exchange in Brazil with over 25 listed cryptocurrencies and the best customer service score.