The Ripple community is in a state of turmoil right now as token holders get angrier and angrier with the actions of Ripple executives. These execs are selling XRP at a rapid rate, and token holders don’t like how it is keeping prices down.
Financial reports have revealed the high quantity of tokens being sold off by Ripple in an effort to fund their aggressive investments. Ripple leadership is attempting to build a large community around the network, as well as fund their operations in the short-term.
To investors, this represents a two-fold betrayal. Firstly, the executives are cashing out on Ripple, which removes the alignment of their incentives with that of token holders. Second, they are putting downward pressure on the price of XRP and hurting the investors that actually believe in the project and bought XRP.
Ironic Twist in Cryptocurrency
Comically enough, just like Bitcoin’s supposed catalyst was quantitative easing by the European Central Bank, it seems like the same applies to Ripple here. Centralized intervention is causing an upset within the community which could lead to a hard fork.
The ideology behind hard forks are essentially what created cryptocurrency in the first place. Forks are a democratic vote against the way one cryptocurrency is being governed.
One Twitter user tweeted:
“I’m thinking about forking $XRP so we don’t have to deal with the founders dumping. — This will be a community effort. Retweet if you’re in.”
This seems all too similar to Bitcoin being created as an alternative to fiat currency and central banks. Just as quantitative easing kept the value of the dollar lower, the dumping of Ripple by high level executives is suppressing the price.
Rebelling against centralized actions leads to decentralization. It is unclear if this users 102,000 followers would be enough to make any sort of dent in the system, but with a change.org petition with the title “Stop Ripple dumping”, it could be the beginning of something bigger.
Brad Garlinghouse, the CEO of Ripple, has countered with the argument that these sales are actually increasing Ripple’s utility. Quarter-over-quarter sales of XRP has decreased and this shouldn’t be a problem for the long-term viability of Ripple.
A Decentralized Coup
As Twitter pointed out, a community takeover would only be possible if Ripple truly was operating a decentralized network. So in a way, the rebellion wins no matter what. They can either successfully take over the network, or prove that Ripple is a centralized entity. Either way, the executives would suffer big time.
On a political level this relates a bit to the situation in Hong Kong right now. Some of the best form of rebellion is by using decentralized currency that can’t be touched by the government.
Protesters in Hong Kong have pre-emptively taken out their money and begun converting it to USD, and some businesses are allowing users to make purchases using Bitcoin in defiance against the Hong Kong government.
The idea is that if funds can’t be monitored or seized, these protestors have less to lose. Violence may triumph in the short-term, but economics will triumph in the long-term.