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Community can force Ripple to burn 50 billion XRP from escrow

  • 4 min read
  • XRP
  • Ripple CTO David Schwartz explains on Twitter that the community could force Ripple to burn its 50 billion XRP.
  • This would require an amendment proposal that is accepted by the majority of validators of the XRP ledger.

Ripple has committed to transfer 50 billion XRP to an escrow account at the end of 2017 and to release one billion XRP for sale each month. This is intended to strengthen the ecosystem by selling XRP to banks, exchanges, payment service providers and other RippleNet members. However, this routine to sell one billion XRP at the beginning of each month is suspected of exerting selling pressure on XRP and thus negatively impacting the performance of the digital asset.

On average, Ripple has sold 196 million XRP per month to investors from 2017 until early 2020. Until the middle of this year, XRP had underperformed, so that voices from the community were raised to stop these mass sales of XRP. However, several members of Ripple, including CEO Brad Garlinghouse, assured that these measures would not affect the price of XRP.

In a recent discussion on Twitter, Ripple CTO David Schwartz said that the community could force Ripple to stop these sales in the future and burn the 50 billion XRP. The user “IKHOR” asked David Schwartz on Twitter if it would be possible to burn all XRP of the escrow account if all nodes, validators and the community would stand united behind this proposal. Schwartz replied that Ripple could not do anything about it if the majority supported a change of the XRP ledger:

Yes. There would be nothing Ripple could do to stop that from happening. Public blockchains are very democratic. If the majority wants a rules change, there is nothing the minority can do to stop them.

In order for a change to be activated in the XRP Ledger, an 80% approval by the validators of the XRP Ledger must be obtained, and this large majority must be in place for two weeks. Only then a new proposal will be activated. In the past, several new features have been implemented for the XRP Ledger in this way, most recently the introduction of the check function.

At that time, it was criticized that it was not possible to refuse payments from unknown sources or to write a check on the XRPL. As a result, a large part of the community got together and put forward a proposal to change the ledger. This proposal was accepted with an 80% majority. According to Schwartz, if a majority agreement cannot be reached, the proposal simply has to be put forward again and discussed.

There are no restrictions on how often a proposal can be submitted. Nevertheless, regarding the question of the Twitter user “IKHOR”, it remains questionable whether there is a broad consensus that Ripple should burn the 50 billion XRP of the escrow account. Earlier this year, the Stellar Development Fund decided to burn 50% of the total 105 billion XLM development fund. In contrast, Ripple cannot simply make such a decision. Schwartz said earlier this year (the price of XRP at that time was USD 0.20):

Too bad XRP is decentralized or someone could just burn half the supply and raise the price to 29 cents.

Der Beitrag Community can force Ripple to burn 50 billion XRP from escrow erschien zuerst auf Crypto News Flash.