Vet explained that such claims are due to a basic misunderstanding of how the $XRP Ledger works.
“The $XRP Ledger is a multi-asset ledger since 2012. $XRP has a special role in auto-bridging: bridging liquidity on the DEX for the long tail of assets, aside from reserves/accounts/fees. More importantly, it’s the only native asset on the network without a counterparty, neutral, can’t be frozen, and anyone can accept it.”
Why $XRP is important
Auto-bridging is one of $XRP‘s most important capabilities. This means that when two different assets are being traded on the decentralized exchange (DEX) within the $XRP Ledger, $XRP can act as a bridge between them.
However, Vet emphasized that the importance of $XRP isn’t only in its use cases for liquidity, transaction fees, account reserves, etc.
“More importantly, it’s the only native asset on the network without a counterparty – neutral, can’t be frozen, and anyone can accept it,” he said.
Unlike issued tokens that can have a counterparty and can be frozen, etc., $XRP is not a claim on anyone.
What about the $XRP price?
Vet also responded to the popular question of why the price of $XRP doesn’t necessarily correlate with the increased utility of the $XRP Ledger.
The expert explained that it is not necessary for the price of $XRP to rise instantly whenever there is new tokenization or institutional integration.
Instead, the expert believes that the focus should be on increasing the adoption of the network first.
Then, as a secondary effect, one can expect that the price may potentially increase.
“A valuable network is a good place to house money,” he said.
“It’s order of operations. Let the price of the native asset be a knock-on effect of large-scale usage and acceptance of the $XRP Ledger.”
