Ripple CTO Defends XRP; Says it’s NOT a Security
Ripple’s Chief Technology Officer (CTO), David Schwartz, recently went on a live session organized by The Next Web (TNW) and answered a lot of questions from the internet users.
In the live session, he was asked questions ranging from important technical questions to questions about how to fold socks (seriously?)
A user going by the name Dr. T asked the Ripple CTO:
“Will it ever be technically feasible to source liquidity from multiple pools (like two or more exchanges) and recombine them into a single atomic payment that’s settled at a destination exchange?
I’m thinking along the lines of something similar to incremental filling of orders on XRP Ledger decentralized exchange that consumes offers from multiple sources. In the RippleNet case, it would mean constructing synthetic order books that have offers from XRP/Fiat pair from multiple exchanges.
I understand that this might not be possible with ILP but perhaps some other solution?”
To this, he replied:
“Congratulations on asking the most technical question today! I believe it is actually possible to do this with ILP, however I don’t know if anyone will ever go to the trouble of building the infrastructure necessary to do it. The philosophy of most of those working on ILP is that it makes more sense to “stream” payments in multiple directions, see which direction is giving you the best rate, and increase the payments you stream in that direction. This is cheap, fast, efficient, and simple to implement, however, it doesn’t guarantee that you will be able to make the entire payment. The hope is that we can design systems that fix that problem at higher levels and keep the money flow layers as simple as possible — kind of the opposite of lightning’s approach.”
Another user going by the name Fred Del Rosario asked:
“David, your thoughts on XRP being labeled a security, Should we expect a decision from SEC soon?”
Schwartz replied to that by saying:
“Ultimately, this will be up to the SEC to decide. We believe that XRP should not be classified as a security. XRP does not give ownership shares in Ripple or any other entity, XRP exists independent of Ripple. If Ripple went away tomorrow, XRP would continue to exist and have the same utility it does today. Neither Ripple nor any single entity can exert unilateral control over the XRP Ledger.”
A user going by the name Gerard asked:
“Where will Ripple and XRP stand 5 years from now?”
Schwartz’s reply to that was:
“I’m always hesitant to try to predict the future and particularly committing to specific timelines. My hope for that time frame is that exchanging value becomes as easy as sending an email. You shouldn’t have to care about what assets or systems the people you’re paying, or who are paying you, prefer to use. It should all just work. This takes a lot of pieces, and I expect ILP to be the enabler that lets these work together.
I think we’ll see open global pools of liquidity that anyone can contribute to and draw off. Perhaps not in five years, but around that timeframe we should have ubiquitous micropayments allowing machines to pay other machines as transparently as other types of information requests occur today. I expect that to be transformational in ways we can’t foresee today and I look forwarding to seeing what the internet of value equivalent of things like Twitter and Uber are.”
Mr Silenos, a TNW user asked Schwartz:
“Do you plan on further decentralizing the XRP ledger even after Ripple now runs less than 50 % of the validators in Ripples suggested UNL? If yes, will you do other steps than simply to remove Ripples validators?”
Schwartz replied to that by saying:
“The XRP Ledger is inherently decentralized because its ultimate governance is the code people choose to run. Anyone who runs a node in any decentralized network is the ultimate arbiter of their node’s behavior, subject only to the limitation that they can only interoperate with nodes with compatible rules.
We are definitely planning on continuing to improve aspects associated with decentralization. While PoW has seemed to be a technological dead end and networks using it are either stagnating or abandoning it, there’s lots of further progress on Byzantine agreement algorithms. Ripple recently proposed adding code for censorship detection to the XRP Ledger software to provide certainty that censorship is not actually occurring. We’ve also published a paper on a new agreement algorithm, Cobalt, that can reduce confirmation latency and also provide provable assurance of correct behavior under a broader set of conditions than the current algorithm”