As someone who’s been deeply ingrained in the software development community for 20 years, I’ve come to realize that misinformation propels hearsay unlike anything else. There are a number of falsehoods circling the XRP Ledger (XRPL) that I encounter on a regular basis including the misconception that it’s centralized, that there are hidden fees, that it’s private and used only by banks — and it’s time to set the record straight. If you’re a developer interested in building on the XRP Ledger, or you simply want to learn more about the network, keep reading. I’m breaking down the facts and debunking the biggest misconceptions about XRPL.
MYTH: The XRP Ledger is Centralized. Based on my experience as a developer and my conversations with fellow devs, this is perhaps the most rampant falsehood — and here’s why. In a centralized blockchain, a single authority governs the entire network, controls validation, controls updates to the ledger, and creates a single point of failure (which theoretically leaves the entire network vulnerable to an attack).
TRUTH: The XRP Ledger is Decentralized. The XRPL delivers powerful utility to developers on a public, decentralized blockchain. Validation occurs via a consensus process where independent nodes are managed by a wide range of participants — not by a singular controlling entity. Amendments to the XRPL can be proposed by any participant and require 80% quorum approval for two consecutive weeks by the validator community. And once confirmed, transactions cannot be reversed or altered.
These are all hallmarks of decentralized ledgers. If there’s one takeaway I want you to remember, it’s this: Ripple is a contributor to the network, but only one contributor among many. As of writing, Ripple run around 5% of the approximately 900 nodes on the XRP Ledger, and six of the approximately 150 validator nodes. Ripple follows the same protocols and its rights are the same as those of any other contributor.
Final Myths to Debunk
MYTH: New XRP Can Be Added to the Ledger. According to this myth, a single authority can make unilateral changes to the fundamental, underlying code, which leaves the Ledger open to hackers who could create new XRP.
TRUTH: Even if a bad actor attempted to add unauthorized XRP to the Ledger, the consensus protocol ensures no single authority can execute on this. More than 66 million ledgers have been successfully closed since the XRP Ledger was first conceived with 100 billion XRP created at the inception of the Ledger, and no additional XRP has ever been added into the system.
MYTH: XRPL Has Hidden Fees. Fees, including transaction costs and reserve fees are returned to Ripple after being implemented into the Ledger, or rewarded to validators after being implemented into the XRP Ledger.
TRUTH: Just like other public blockchains, transaction fees are applied on the XRP Ledger, although they are far lower than most (just fractions of a cent on XRPL). Unlike other blockchains, however, the fee is neither returned to a central authority or paid as a reward to validators or any other party. It is, in fact, irreversibly destroyed. Because fees rise in-step with the load on the network, this protects the network from spam, malicious behavior and DDoS attacks. Furthermore, XRP transactions on the Ledger are settled almost instantaneously (only 3-5 seconds to confirm completion vs. 10+ minutes for other blockchains, or multiple days for banks to send cross-border fiat funds to other banks). The XRPL consensus protocol bridges the gap, saving substantial time and transaction costs.
MYTH: Blockchains Can’t Be Decentralized, Scalable and Secure. Improvement in one of these aspects must negatively impact one of the other two. We must sacrifice one to optimize the others, right? Not so fast–here’s the truth.
TRUTH: The Blockchain Trilemma is a model to conceptualize the challenges that all blockchains face, stating that the platforms cannot be truly decentralized, scalable and secure all at once. The truth is, the XRP Ledger was the first and is one of only a few blockchains able to run a decentralized, on-chain, limit order book exchange in near real-time. It can sustain a maximum throughput of up to 1,500 transactions per second (scalable), is managed by a range of diverse participants who collectively confirm transactions and approve proposed amendments (decentralized) and utilizes consensus protocol that protects against attacks and failure modes (security). And XRPL does all this in a very sustainable way. In fact it is the world’s first major, global, carbon-neutral blockchain.
In Conclusion…
Developers need to find the best blockchain for their project requirements. Any misunderstanding around how the tech works hinders that process.
By diving into the nuts and bolts of how the XRPL operates, we’ve been able to debunk several myths and misconceptions about the ledger as well as review some of the advantages that make it ideal for a wide variety of projects. Hopefully, this overview will help you to look beyond the unfounded myths circulating about the XRPL to discover another viable tool for your needs.
For more information, head to XRPL.org, where you can find plenty of background documentation, updates on ongoing projects and an extensive FAQ. If you happen to be scrolling through Twitter, feel free to ask me anything @HammerToe.
The post Facts & Fiction: Debunking XRP Ledger Misconceptions appeared first on Ripple.
