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Despite the Criticism, Ripple Arguably More Decentralised Than Bitcoin

  • Darryn Pollock
    🤷 Opinions

    Many won’t even class XRP as crypto because of Ripple’s control, but they could also argue that the XRP token is more decentralised than BTC


Despite the Criticism, Ripple Arguably More Decentralised Than Bitcoin
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Ripple, and its token, XRP, have faced a constant barrage of criticism relating to their decentralization of the token over the years. Many cryptocurrency purists have criticised their inner workings with Ripple, the company, clearly in charge of the XRP token and its distribution.

However, this allegation has been as equally denied by the those at the head of Ripple; in fact, it has even seen the CEO, Brad Garlinghouse, state that the XRP ledger is in fact more decentralized than both Bitcoin and Ethereum.

This statement alone will get many raring for a fight, but a closer inspection and interpretation of what it means to be decentralised could indicate that Ripple has a point. They could indeed argue that they are more decentralized than the other two major cryptocurrencies, based on the mining pools.


It is well known that controlling the majority of the mining of traditional proof-of-work coins, like Bitcoin and Ethereum, can lead to a 51% attack, which destroys the decentralisation of the blockchain and hands full control to one person, or group, or pool.

Bitcoin has been flirting with the 51% attack recently, and previously, but for Ripple, it is a different story, as they only have seven percent control of the validators. Looking at the interpretation of decentralisation, there technically have been more chances for Bitcoin to be controlled by one group than there has Ripple – so is it less decentralised?

Making claims

To be honest, the idea of decentralisation is really up for debate, and it is also dependant on interpretation, thus the claims being made on their side of these fence are debatable, but it is interesting to hear the thoughts of Garlinghouse.

“It is very clear that the XRP ledger is decentralized,” said the CEO of Ripple. “Ripple runs seven validators, which is about four percent of all public validators.”

He added:

“By almost any measures now, the XRP Ledger is more decentralized than the Bitcoin ledger or Ethereum ledger, where you have a very small number of miners controlling you know well past 50% of mining power.”

It is true that Bitcoin’s mining has almost been monopolised in the past by the likes of Antpool, BTC.com, and ViaBTC, with Bitmain at times having the power to launch a 51 percent attack, but never acting on this. However, it shows just how much the mining has been centralised in Bitcoin.

Ripple’s argument

If one was to base the mining and validation of cryptocurrencies as the key determining factor of their centralisation, then it would be preposterous to say that Bitcoin is decentralized.

Ripple, the company, despite having control in different areas of the XRP token, only controls seven percent of its validation. Thus, on this basis, they have very little control and it should be argued that XRP is decentralised.

cryptocurrency

 

A lot of this argument is also predicated on the algorithms that these two coins use, however.

Bitcoin and Ethereum use proof-of-work algorithms. This system rewards miners for validating transactions by paying a fee for their work. This was a great starting point for a decentralized system that incentivizes complete strangers to contribute to the greater good of a network and make forward progress.

But as time has gone on, clear limitations have manifested. Blockchains that use proof-of-work can be subject to centralized control, where a few miners have significant control over the system.

The XRP Ledger uses a consensus protocol that relies on a majority of validators to record and verify transactions without incentivizing any one party. Validators are different from miners because they aren’t paid when they order and validate transactions.

Today, these validators operate at locations across the globe and are run by a broad range of individuals, institutions, asset exchanges and more.

More to it

As mentioned, this form of argument in regards to decentralisation only takes into consideration one aspect. But in this aspect, indeed, Ripple is superior. However, when it comes to purists and believers in how blockchains should operate, many have an issue with a company having discretion over tokens.

Ripple has been a coin that differs substantially from most of the top 20 coins by market cap – that does not necessarily mean it is wrong, nor right, but it is certainly showing that things can be done in different ways in the blockchain space.

Cover image via u.today
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Blockchain Adoption Uncovered by Forbes as Billion Dollar Companies Buy In to Drive Technology

  • Darryn Pollock
    🤷 Opinions

    Blockchain adoption by billion dollar companies is probably a lot further along than expected as Forbes has revealed


Blockchain Adoption Uncovered by Forbes as Billion Dollar Companies Buy In to Drive Technology
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Forbes has recently released a list of 50 companies utilizing blockchain technology that are valued at over a billion dollars, these companies include the likes of Amazon, Microsoft, IBM, as well as less technical ones such as BP and Walmart.

What is surprising about the list is just how broad the scope of interest is when it comes to blockchain by these massive global companies. The adoption of blockchain, over the last 10 years, has been relatively slow, up until now.


But, in 2019, it seems that the future of technology has been laid out and to get a competitive edge these companies realise that there is a lot that can be done with blockchain and that they need to get their foot in the door.

Heavy hitters

While the Forbes list paints a grand picture of blockchain adoption, it also shows just how far along in the process some of these companies are. For companies to have made it onto the list, they have to have been using blockchain in some sort of effective and tangible way.

There are some, like insurance giant MetLife, which already has a working blockchain, and product, that has been going since 2014. Back then, the adoption of blockchain by major companies was not even heard of – it was more about the starting boom of Bitcoin.

But blockchain is the new leader in the space, taking over the batton from cryptocurrencies which certainly helped raise the profile of the entire ecosystem. If it was not for the cryptocurrency boom, a lot of these major companies would never even have stumbled across the underlying technology.

A drive for blockchain

Now, with the cryptocurrency market right back down again, and a lot of the speculation having been cleared out, there has been a whole year of rather focusing in on blockchain building and its application, instead of making money off speculative tokens.

That change in mindset has really helped major corporations take on the technology and begin experimenting with its efficiency and disruptive powers. There is almost an arms race going on as the advantages the technology can give across a huge spectrum of enterprises, which are massive and very coveted.

A need for enterprise investment

There still remains a debate as to whether blockchain, and crypto, with its decentralised nature, is in need of these major corporations coming in to monopolise the space which was born out of defiance of banks.

However, it would be foolish to think that blockchain can reach its full potential without a drive from big companies with big budgets. Smaller startups and companies are able to bring innovation and excitement to the space, but the mass adoption will only come when the heavy hitters are involved.

Cover image via 123rf.com
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