A recent post by crypto researcher *SMQKE* has sparked a lot of buzz in the crypto world, with claims that *Ripple’s private central bank digital currency (CBDC)* ledger directly uses *XRP*. This has led to some serious debates, as many people are questioning whether XRP truly plays a major role in Ripple’s enterprise solutions.
Let’s break it down and see what’s really happening! 🔍
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*SMQKE’s Claim: XRP in the Private Ledger* 💭
SMQKE suggested that *Ripple’s CBDC private ledger* directly *utilizes XRP*, citing documentation to back up the statement. This raised eyebrows in the community because XRP has historically been seen as a key player in *RippleNet*, but not necessarily in *Ripple’s enterprise solutions*, especially those used by banks. 🤷♂️
*The Counterargument: XRP is Not Always Involved* 💥
An X user, *Juliett Echo Tango*, jumped in with a *counterargument*, claiming that XRP is used only in *one* of the three main products within *RippleNet*. She explained that *banks avoid exposure to cryptocurrency* and *public transaction records*, which is why they prefer *centralized private ledgers* that *don’t rely on XRP*. 🚫
*RippleNet Structure*: The Breakdown 📊
RippleNet is made up of several products:
1. *xRapid*: The only product where *XRP* is used for *on-demand liquidity*.
2. *xCurrent* and *xVia*: These provide cross-border payment infrastructure *without the need for XRP*. These solutions allow for faster and more efficient international payments *without exposing banks to the volatility of cryptocurrencies*. 💸
*Regulatory and Financial Concerns* ⚖️
One of the main reasons banks shy away from XRP is *regulatory uncertainty*. The *SEC’s lawsuit* against Ripple raised concerns about XRP’s legal classification, making banks *hesitant* to use it, as they need to comply with strict *AML* and *KYC* regulations. 🛑
Another important factor is *risk management*. XRP’s *volatility* is a *turn-off* for institutions that prefer stability in their transactions. *Banks* need consistency when processing cross-border payments, and the unpredictable nature of cryptocurrencies could create financial risks. 📉
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*The Bottom Line: What Does This Mean for XRP’s Role?* 💬
- *XRP’s role in RippleNet* is mainly for *on-demand liquidity* through *xRapid*, while *xCurrent* and *xVia* provide cross-border payment solutions without XRP.
- *Banks* prefer *centralized, private ledgers* that don’t rely on cryptocurrencies because of *regulatory concerns* and *volatility*.
- The *CBDC* might use a private ledger system, but that *doesn’t mean XRP* is *involved* in all Ripple’s products or solutions.
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So, if you’re still holding onto the belief that *XRP is the backbone* of Ripple’s entire operation, *it’s time to rethink that*! 😬 XRP has a specific role, but it’s not *everything*. 📉