XRP Community Divided Over Ripple’s Obligations to Token Holders
An impassioned open letter addressed to Ripple CEO Brad Garlinghouse and CTO Emeritus David Schwartz has ignited a significant debate within the XRP community, centering on the question of what, if any, obligations Ripple has to those who hold its digital asset.
The Letter’s Argument
The letter, posted on X by an XRP holder, contends that the community’s unwavering support for Ripple through years of uncertainty, negative press, and the protracted legal battle with the Securities and Exchange Commission (SEC) warrants a reward. The author argues that this loyalty should be acknowledged and reciprocated.
Holder Pushback and Counterarguments
The letter garnered a substantial number of responses, with many disagreeing with its premise. A significant portion of XRP holders asserted that Ripple has no inherent obligation to artificially inflate the XRP price. One commenter pointed out that individuals purchased a commodity, not equity in the company, and highlighted that Ripple, not retail investors, bore the financial burden of the SEC lawsuit. Another noted that Ripple itself holds a substantial quantity of XRP, thus possessing a vested interest in seeing the token’s price rise.
However, some responses were more sympathetic, with several individuals expressing understanding for the frustration stemming from years of anticipation for a significant price surge that has yet to materialize.
Bill Morgan: “That Is On You”
Bill Morgan, a legal expert well-recognized within the XRP community, identified a perceived contradiction in the community’s stance. He recalled that during the SEC lawsuit, many XRP holders maintained they did not depend on Ripple’s efforts to enhance XRP’s value. This position, Morgan explained, was crucial to Ripple’s legal defense, as reliance on another party’s actions is a key determinant in classifying an asset as a security.
Morgan now observes that many of these same holders are criticizing Ripple for prioritizing RLUSD over XRP. He believes that individuals who invested at peak market cycles based on influencer predictions of $10, $20, or $100 XRP should accept personal responsibility for those investment decisions.
The Escrow Conundrum
Morgan also addressed Ripple’s XRP escrow, a recurring point of contention. In December 2017, Ripple placed 55 billion XRP into 55 escrow contracts. This arrangement permitted Ripple to release a portion of the monthly supply while re-locking the remainder.
Morgan posited that had Ripple simply released 1 billion XRP each month, the escrow would have been depleted by the latter half of 2023. This would have resulted in approximately 95% of XRP’s total supply being in circulation, thereby ending the persistent criticism regarding Ripple’s alleged “dumping” of escrowed XRP.
Significance of the Debate
This exchange underscores a persistent tension within the XRP community. Ripple operates as a private entity with its own strategic business objectives, while XRP holders possess a distinct asset whose market price is beyond Ripple’s direct control. As Ripple diversifies its operations into areas such as stablecoins, custody services, and banking, this divergence in expectations is likely to remain a recurring theme.
