- The real role of XRP on the XRPL has been unveiled by Xumm founder.
- The coin is used as an access to the entire Ripple Network.
Amidst discussions about the possible role that XRP plays on the XRP Ledger (XRPL), Wietse Wind, the founder of XRPL Labs and Xumm have compared the token to a bus ticket.
For context, he claimed that XRP is only a resource for consuming network capacity on the XRPL. Noteworthy, the conversation was triggered by an initial X app comment from Vet, an XRPL DUNL validator who tried to dismiss the concept that XRP is a gas token on the XRPL.
In his opinion, gas refers to an auction mechanism where XRP is used to bid on gas to secure transaction processing just like Ethereum (ETH) is used by validators. He argued that this is not the case on the XRPL. Ripple’s Chief Technology Officer David Schwartz totally supported this notion.
To clarify, Wind explained that XRPL still leverages a bid mechanism that goes into burning XRP. In XRP’s defense, Xumm’s founder highlighted that this bidding approach was not noticed because the ledger was hardly utilized compared to its capacity. He went in to recall a certain time when the fees increased.
As a dynamic protocol, there is a mechanism where users can fast-track their transaction processing by offering higher XRP fees. This makes up for the auction-style bidding for transaction inclusion which the protocol does not employ.
Usually, there is an automatic movement of fees on the XRPL to the burn address. This kind of mechanism takes away the problem of spam transactions and it is quite different from the structures found on other networks.
XRP Ledger Shows Underutilization
Per being a bus ticket, XRP is the means to access network capacity. A less congested network is more likely to allow the processing of transactions with standard fees. In the case of congestion, on the other hand, users can get their transactions processed ahead of others by paying higher transaction fees but this is hardly the case due to the underutilization of the ledger at this time.
“At the end of the day, XRP is simply what you use to consume network capacity like bus tickets. And if the bus is full, you can kick someone out by paying more for a ticket. The bus is usually pretty empty,” Wind said.
To conclude, Wind asserted that the commotion surrounding XRP currently is hinged on investors trying to speculate on the need for more XRP tokens. Meanwhile, the token has been doing well since it was conferred the non-security status by Judge Analisa Torres. It has now become a promising beacon in the crypto ecosystem. There is a renewed enthusiasm and optimism surrounding the XRP token.
The XRP token is recognized for its utilization for cross-border payments amongst its other utilities. Several partnerships and adoption of the XRP have been seen lately.
