A recent discussion around the XRP Ledger’s fee structure prompted David Schwartz, Ripple‘s Chief Technology Officer and a primary architect of the ledger, to clarify how XRP derives its value. His remarks have quickly gained attention within the XRP community.
The origin of the debate
The conversation began when a user on X questioned the rationale behind the XRP Ledger’s approach to burning transaction fees. The user contended that the ledger’s architects intended for XRP to function as a deflationary currency, emphasizing the eventual impact of continuous fee burning over time.
Saul, another community member, responded by challenging this view. He maintained that the primary reason for the fee structure on XRPL is to prevent spam rather than to drive up prices. Saul stated, “You need fees for spam prevention, but they can’t go to validators, so instead they burn the fees. But the key is that they keep them LOW.”
David Schwartz clarifies XRP’s value
Schwartz entered the discussion by outlining the factors behind XRP’s value accumulation on the ledger. He explained, “Low fees and reliable operation make XRPL a great place to move and hold value. That drives value flow to XRPL. XRP captures some of that value because of its unique advantages over other assets on XRPL.”
Low fees and stable performance bring users to the XRPL network, encouraging capital flows. XRP benefits from this activity due to its position and features as the native asset within the ecosystem.
Schwartz’s comments connect the quality of the XRP Ledger’s infrastructure—namely low fees and operational stability—to its appeal as a medium for value transfer. As more activity takes place on the network, XRP increasingly benefits from its integral role.
Mini dictionary: XRP Ledger (XRPL) is a decentralized blockchain network designed for fast, low-cost digital asset transfers and serves as the foundation for XRP transactions.
The purpose of low fees
According to Schwartz, the design choice to keep fees low is deliberate. While higher transaction fees could theoretically accelerate the deflationary impact through fee burning, they would also deter users and damage the ledger’s utility. The architects set low fees to ensure accessibility and encourage regular use, with deflation being an incidental outcome rather than the main goal.
This approach highlights that XRP’s underlying value thesis is linked to the ledger’s practical benefits—not merely decreasing token supply. Sustained network activity and cost-effective operations serve as the foundation for utility-driven demand.
The value proposition for XRP centers on utility and network activity, not just scarcity. Maintaining a cost-effective and efficient ledger ensures continued value transfer through XRP.
XRP’s unique position on XRPL
Schwartz pointed to XRP’s unique advantages on the ledger. As XRPL’s native asset, XRP serves several purposes, including acting as a bridge asset in cross-currency transactions and being required for transaction fees. This embedded role ensures XRP can capture a significant share of the value moving through the network.
Crypto community member Archie later highlighted Schwartz’s explanation on X, noting that the CTO had summarized the XRP value thesis in just three sentences. Schwartz’s direct involvement as one of the original architects lends additional weight to these comments within the community.
