Ripple CTO Explains XRP’s ‘Gradual Appreciation’

• An X user questions how XRP fits into the “gradual appreciation” theory, and claims it is nowhere near projects like Bitcoin favored by speculation. 

• Ripple’s CTO believes that moments of bull or bear market are not “gradual appreciation” in his book. 

Ripple Labs’ Chief Technology Officer (CTO) David Schwartz has weighed in on an ongoing skepticism surrounding the steady rise of XRP. Responding to an X user who questioned the asset on the grounds of its “gradual appreciation” tag, Schwartz referred him to a 12-year chart of Bitcoin showing how the digital asset has appreciated gradually over a long period. 

According to the user who identifies himself as Mr. Huber, XRP does not look like something that is appreciating over time compared to projects that are favored for speculation. Elaborating on this, the user explained that the only price increase the asset has been able to hold was not gradual. In comparison, he stated that Bitcoin can appreciate gradually more than XRP. He also referred to an earlier post comprehensively covered by Crypto News Flash where the Ripple CTO emphasized that he does not see XRP as a lottery ticket or speculative gamble, but rather, a volatile asset with potential for gradual appreciation. With this, Mr. Huber questioned the difference between the two. 

Schwartz Speaks on Concerns Surrounding XRP

Addressing the earlier post regarding XRP and gradual appreciation, Schwartz explained that things like Automated Market Maker (AMM) and staking are evaluated as alternatives to long-term holding. On top of that, moments of bull or bear markets do not appear to him as long-term gradual appreciation.

Here is a chart of Bitcoin over the past 12 years on a log scale. The long-term behavior is that of gradual appreciation. When evaluating things like AMMs or staking, I generally evaluate them as an alternative to long-term holding which gives you this long-term gradual appreciation. I realize that in the moment of a bull or bear market, it doesn’t feel like long-term gradual appreciation. And there’s no guarantee that this is how any particular asset will look over the future.

It was recently reported by Crypto News Flash that XRP Ledger (XRPL) is introducing AMM, offering a chance for passive income to XRP holders by providing liquidity to pools. However, most of the reactions around it have been quite discouraging. In this context, a user asked Schwartz if AMM would still benefit anyone after reading all the negative posts on social media. 

According to the Ripple CTO, people are always looking for riskier projects with the hope of a higher return. 

Digital assets have a lot of volatility. AMMs let you turn that volatility into yield, get yield from making markets, and reduce your risk of losses due to long-term price decreases. I suspect people who feel the way you do are looking for something even riskier that provides a promise of an even more absurdly high return. AMMs are not that.

XRP is currently up by 2.9% in the last 24 hours, trading at $0.61. Its 24-hour trading volume has, however, declined by 31% with a total figure of $1.6 billion. Regardless, pro-XRP lawyer Bill Morgan believes that there could be a new all-time high in 2024. 

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