Before the process between the SEC and Ripple started, there was a statement that XRP was not a real cryptocurrency, but a centralized project. This is due to several features. The main reason for this was the criticism of the” closed ” centralized nodes of the network. This led to an ongoing animosity between XRP holders and the rest of the crypto community.
Can XRP transactions be restricted?
In an interview with the Crypto Jebb YouTube channel, Matt Hamilton, Director of Developer Relations of Rippe, commented on some Ripple and XRP myths. Hamilton said that the terms centralization and decentralization mean different things to different people. Therefore, the community cannot agree on whether XRP is a centralized or decentralized network.
But for him, decentralized means the opportunity for everyone to use the network without restriction. For example, Hamilton said that no party can stop XRP users from intervening on the network.
“The most important criterion is that you don’t want someone blocking or censoring you or preventing you from using the network, right? I want to be able to make a payment… In this regard, XRP Ledger is decentralized.“
He added that no one can seize XRP tokens and that transactions cannot be censored, which he believes is a crucial measure of decentralization.
Ripple has no control over the XRP network
Another point of contention relates to the centralization of nodes. A node connects to the network to validate and forward transactions, while also keeping a copy of the blockchain. Full nodes ensure that certain rules are followed. The danger here is that a dominant entity that controls the majority of nodes will manipulate the network.
The XRP network currently has 156 validator nodes, 19 of which are identifiable as Ripple nodes, meaning Ripple controls 12%. Hamilton confirms this by saying that Ripple nodes make up only a small percentage of the network. He also adds that an 80% consensus is required to validate transactions. Therefore, Ripple cannot manipulate the network.
The network itself is decentralized. Ripple controls only a few percent of the nodes on the network. And the consensus algorithm means you need 80% consensus on the transactions. So there is no one-sided party that controls it.
To round off the debate, Hamilton said that although Ripple holds most of XRP, it is a “trust-based” consensus algorithm and not a proof-of-stake model, and thus the amount of XRP held has no bearing on control.
Text credit: cryptoslate