The value of the cryptocurrency ecosystem skyrocketed in 2017, with various cryptocurrencies surpassing 1,000% gains. Ripple’s XRP token, for example, was worth about $0,006 in the beginning of 2017 and is currently trading at $3.76. The 60,000% rise helped Ripple become the second-biggest cryptocurrency by market cap, and is now valued at over $140 billion.
Behind the XRP token is San Francisco-based company Ripple, which uses blockchain technology in financial transactions. According to Forbes, its co-founder and former CEO Chris Larsen, owns 5.19 billion XRP tokens, currently worth over $16.9 billion. He reportedly also owns 17% of the company, bringing his total net worth to $44.16 billion at current rates.
This makes Larsen the 18th richest person in the world, behind Indian business magnate Mush Ambani, according to Bloomberg’s Billionaire Index. Back in November 2016, the 57-year-old stepped down as CEO of Ripple, turning the reigns over to Brad Garlinghouse, the company’s current CEO.
Citing a source at the company, Forbes claims Garlinghouse owns 6.3% of Ripple, and additional XRP tokens. Per its report, his net worth was of “at least” $9.5 billion at the time, meaning he would be number 153 on the list, above Fidelity’s Abigail Johnson, a big cryptocurrency fan herself. Since Forbes’ report, XRP’s price surged 38%.
Another XRP billionaire is Ripple co-founder Jed McCaleb, who notably founded Mt Gox in 2010. McCaleb reportedly left the company in 2013, but came to an agreement with it over the tokens he owns.
The agreement involves him receiving a share of his 5.3 billion XRP tokens on a monthly basis, while the rest is under Ripple’s custody. If he had access to all of his tokens at once, he would have $19.9 billion. McCaleb claims to have no bitcoins left from his time with Mt Gox, and has founded Stellar after leaving Ripple. He’s said to own one billion Lumens, each currently trading at $0.89.
A ‘Centralized’ Cryptocurrency?
Ripple claims to have over 100 clients, including American Express and Santander, both currently collaborating on payments using Ripple’s technology. As reported by CCN, it recently launched the Arrington XRP Capital, a $100 million cryptoasset hedge fund launched by TechCrunch founder Michael Arrington.
Ripple itself holds 61.3 billion XRP tokens, 55 billion of which are kept in escrow. Taking into account that only 38.7 billion XRP tokens have been distributed, it’s clear the cryptocurrency isn’t as decentralized as, for example, Bitcoin. This, despite various holders having a large number of bitcoins, including Satoshi Nakamoto, the cryptocurrency’s creator, who’s believed to have 980,000 Bitcoins, equal to roughly 5.8% of all currently existing bitcoins.
Granted, Ripple has unveiled a strategy that, per its technology chief Stefan Thomas, will make the Ripple Consensus Ledger (RCL), Ripple’s blockchain, more secure, efficient and decentralized than bitcoin. The strategy will include three fundamental steps. First, Ripple will grow and diversity the validator nodes on its blockchain, to avoid the risk of a single point of failure. Then, it will recruit attested validators and monitor them, so it can then add them to its Unique Node Lists (UNLs). A UNL is a list of transaction validator nodes seen as “trusted.”
The strategy’s goal is definitely an applaudable one. However it has been argued that the company’s technology chief went too far in stating its blockchain would become “more decentralized than bitcoin,” as it may be undersireable, and maybe even impossible, for Ripple to become more decentralized than bitcoin.
Yacht image from Shutterstock.Follow us on Telegram or subscribe to our newsletter here.
• Join CCN's crypto community for $9.99 per month, click here.
• Want exclusive analysis and crypto insights from Hacked.com? Click here.
• Open Positions at CCN: Full Time and Part Time Journalists Wanted.