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David Schwartz: Low Price Makes XRP Bad for Payment
$XRP A recent post by crypto enthusiast FoJAk (@FoJAk3) on X highlighted a statement from former Ripple CTO David Schwartz that is drawing attention in the crypto community. When asked about XRP prices, Schwartz explained that “a low price for XRP actually makes it more expensive to use for payments and exchanges.” This comment clarifies a key aspect of XRP’s utility in global transactions. Unlike some cryptocurrencies, where a low price is seen as an advantage for adoption, Schwartz’s explanation emphasizes that XRP functions differently. The token’s efficiency in moving value depends on price levels. If the XRP price is too low, larger amounts are required for transfers. This increases operational complexity and transaction costs for users and institutions. Higher XRP prices reduce the number of tokens needed to move the same value, making transactions more efficient and cost-effective.
👉Impact on Market Perception Schwartz’s clarification aligns with ongoing discussions about XRP’s role in financial infrastructure. For investors and institutions, the statement reinforces the idea that XRP’s value is closely linked to its practical use. The token’s design enables it to settle payments quickly and at scale, which makes its price a crucial factor in adoption. This perspective also suggests that XRP’s growth potential is rooted in its functional utility rather than speculative interest. Users and institutions benefit from a higher token price because it reduces the transaction volume needed. This operational advantage encourages long-term use and supports the argument for XRP as a reliable tool for cross-border payments. 👉Institutional and Practical Considerations Financial institutions integrating XRP must account for liquidity and cost efficiency. Schwartz’s point underlines that extremely low token prices can create unintended inefficiencies. For companies processing large payment volumes, higher XRP prices streamline transfers and reduce the complexity of managing token balances. This explanation strengthens the case for XRP’s adoption in both retail and institutional settings. Schwartz has previously explained that XRP cannot remain cheap because fewer tokens are required at higher prices. Institutions can achieve faster settlements with fewer tokens, simplifying accounting and liquidity management. Over time, this dynamic could support broader acceptance of XRP as a standard payment asset in global financial networks. 👉Implications for Investors For investors, the statement highlights a unique aspect of XRP’s value proposition. Unlike purely speculative tokens, XRP’s pricing directly affects its practical applications. Investors looking for sustainable growth may view higher token prices as positive for long-term adoption and network efficiency. By linking price to usability, XRP demonstrates that its design encourages adoption through functional benefits rather than purely market speculation.
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