In a recent online discussion, Ripple’s former CTO David Schwartz firmly rejected allegations that the company’s ongoing XRP sales negatively impact token holders. He explained that financial markets are forward-looking and factor in the expected future sales of XRP into its current price. Therefore, when Ripple sells XRP, it receives a lower value because the market has already discounted those distributions. Consequently, it is Ripple, not the investors, that bears the economic cost.
Pro-crypto lawyer Bill Morgan added context, noting that Ripple has not sold XRP directly to retail investors for years. However, an executive from Chainlink challenged Ripple’s business model, arguing that Ripple monetizes its pre-mined XRP holdings to fund operations, acquisitions, and shareholder returns. The executive claimed this transfers financial risk to token holders while they benefit. Additionally, the executive asserted that Ripple’s RLUSD stablecoin has replaced XRP’s utility as a bridge asset.
Schwartz countered these points by emphasizing that any rational investor entering the XRP market already accounts for the possibility of future Ripple sales. This means that selling pressure is baked into the price, preventing unexpected disadvantage for existing holders. He added that Ripple’s diversification into other areas, such as payments and custody, while maintaining a large XRP position, ultimately supports the token’s long-term value.
The debate comes amid a broader discussion about Ripple’s evolving strategy. An AI-driven analysis suggested that since the SEC lawsuit, Ripple has shifted its focus away from making XRP the central pillar of its business. Instead, the company increasingly uses XRP’s value to finance acquisitions and expand offerings like RLUSD. Bill Morgan and Zach Rynes also engaged in a debate over whether Ripple’s growth predominantly benefits XRP holders or Ripple shareholders.
Schwartz’s intervention primarily aimed to correct misconceptions about market pricing, rather than re-litigate XRP’s overall utility. His statements reflect an ongoing conversation in the crypto community about the alignment between Ripple’s corporate interests and those of XRP token holders.
