A recent exchange between Ripple CTO David Schwartz and VanEck's Matthew Sigel has shed light on the core value proposition and operational mechanics of the XRP Ledger, particularly addressing common misconceptions about its utility and any potential "tax" on its users. Schwartz’s insights clarify the network’s purpose, its fee structure, and its decentralized nature.
Demystifying XRP Ledger's Value
VanEck's head of digital assets research, Matthew Sigel, challenged the XRP community by questioning the Ledger's utility and asking who "collects the tax" if XRP holders don't earn passive income. David Schwartz, Ripple's CTO, countered this perspective by emphasizing the blockchain's fundamental ethos: "no middlemen, be your own bank." He highlighted that the XRP Ledger offers a robust platform for issuing assets, facilitating trades, creating NFTs, and processing payments, positioning it as a versatile public good accessible to all.
The Truth About "Taxes" and Ownership
Schwartz explicitly stated that there is no "tax" on the XRP Ledger. Instead, what some might perceive as a levy are merely transaction fees and reserves, which are meticulously designed to combat spam and ensure network stability. These minimal fees, typically less than $0.003 per transaction, are systematically burned, contributing to a deflationary pressure on XRP's total supply. The CTO further clarified that the XRP Ledger is not owned or controlled by XRP holders; it operates as a decentralized public utility, emphasizing that "Holding XRP gives you XRP. Full stop," underscoring its role as a direct utility rather than an income-generating asset for holders.
