“Eventually, we will see the NFT market expand,” says David Schwartz, Ripple’s CTO. Ripple may be a little late to the NFT party, but XRP Ledger will try to be a game changer in the industry and challenge Ethereum’s hegemony. Interview with Ripple CTO cryptocoin.com we have prepared for you.
You also mentioned that XRP Ledger is energy efficient. Can you explain why this is so?
Yes, the reason Proof of Work (PoW) systems like Bitcoin (BTC) and Ethereum (ETH) consume energy is because they are specifically designed to create artificial scarcity. If you’re trying to profit from something that should be scarce, you want artificial scarcity. You also need artificial scarcity for something to be valuable, and you need to convince customers that the scarcity isn’t artificial.
So PoW creates artificial scarcity by using something that is scarce, namely energy. When energy is used to create purely artificial scarcity, it increases the cost. The only reason you want to do this is because you’re getting a share of the money. Only people who get these fees are promoting this technology. No one charges transaction fees on XRP Ledger, so no one wants high fees. The fee literally covers the cost of processing the transaction. The truth is that XRP Ledger works just as well without artificial scarcity.
Are there any other benefits of using Riple (XRP) Ledger for NFTs versus Ethereum?
Yes, one of them is scalability or transactions per second. While you can’t do it with XRP Ledger, there are things you can do with Ethereum. That’s why a lot of decentralized finance (DeFi) work is being done on Ethereum today. You can do pretty much anything you can imagine, like things like loans or TradeFi or mortgages and bets. We don’t have these capabilities in Ripple (XRP) Ledger today, but you can print NFTs. We also have a decentralized exchange (DEX) and you can issue new tokens. Payments are cheap and fast, so to some extent this is a basic engineering tradeoff.
If you want to do everything, then you cannot be very good at anything. There is a list of things XRP Ledger does really well. If one of these is one of the things you need, that’s great. Whatever you need, then you need to move on to something more general.
Part of Ethereum’s slow transaction speed and cost is due to the fact that you can build more flexible technologies on its blockchain. Most people building on the XRP Ledger do complex things, but for technical reasons they don’t need to be on the ledger.
What are the best use cases for someone looking to push NFT to XRP Ledger?
Today, usage examples are mainly collectibles. The cost is much lower on Ripple (XRP) Ledger so if you are building an NFT on Ethereum it should be worth at least $500 and even then the fees are close to $100. Fees are much less on XRP Ledger and this allows for a wider range of use cases.
I think most of the use cases today are collectibles in general, such as works of art, things connected with digital art, things connected with musicians. But over time, I think we will see the NFT market expand.
I also wanted to discuss Wrapped Ripple (XRP). Can you go into detail about that?
Wrapped XRP is an asset designed to monitor the price of RP. Each Wrapped Wrapped XRP for XRP, in a place connected to an ecosystem There is an XRP that keeps it locked until XRP is released. The idea is that they should follow the price closely. Wrapped XRP will behave similarly to XRP. For example, if you only use XRP for moving value and own something with the same value, they should serve as substitutes in the market.
The downside of Wrapped XRP is that you cannot move it cheaply and quickly on XRP Ledger like Ripple (XRP). But the advantage is that you can use it in DEX on Ethereum.
For example, if you have 500 XRP to use in a DEX and you can’t do it at any price today, Wrapped XRP lets you get the tokenomics of XRP and the semantics of Ethereum. This will help prevent Ripple (XRP) from being locked out of features. We can expect to see the Wrapped XRP launch in December.
What’s next for Ripple?
We push hard for CBDCs. The exciting thing is that there are so many people in space who don’t really know what CBDCs can do. Our vision is to imagine that every financial institution in the world can close every fiat currency with every other financial institution in seconds. This is huge, but requires interoperability and security.
If you’re going to build a payment system this large, you need a security model that isn’t what Swift uses, and Blockchains have virtually no security issues.
Another feature is interoperability. For example, the United States could not establish such a system because Saudi Arabia would not use it. But if Saudi Arabia installed a system and the US installed one, there should be a standard for interoperability. Otherwise, banks in the USA cannot reconcile Euros with banks in Europe.
Another thing we’re working on is federated side chains that allow assets to move freely between blockchains. Wrapped XRP is an example of this as it allows XRP to move between XRP Ledger and Etherem. But these are point solutions to specific problems. The advantage of solutions for a particular problem is that they allow for a kind of innovation that is not currently possible.
Today, if you want Ethereum smart contracts, you need to create a Blockchain with Ethereum smart contracts. You have to follow the rules as well as how big a smart contact can be. Therefore, you cannot innovate at the level of changing these rules. What federated side chains do is allow you to innovate at the lowest level. Thus, users can create a Blockchain with whatever fees and assets they want. It can be public or private and can be brought to life in a short time with real money.
This is great for developers who need to solve specific problems or want to make changes to other Blockchains and convince people that those changes work and are safe. Federated sidechains provide a recipe today for creating living blockchains that allow users to innovate within the blockchain itself.
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