Ripple’s CTO Clarifies Rationale Behind 100 Billion XRP Total Supply

In a recent Twitter exchange, lawyer Bill Morgan sparked a thoughtful discussion about the decision behind issuing 100 billion coins on the XRPL (XRP Ledger) and its implications for tokenomics.

The conversation unfolded in response to a user’s observation about SOL’s circulating supply being significantly smaller than XRP’s, prompting Morgan to delve into the rationale behind the XRPL’s substantial coin issuance.

Fredo Ayala, the X user, pointed out that, while the rate of inflation might be similar, the vast supply of XRP is designed to enhance liquidity. However, Ayala argued that this abundance could potentially hinder price appreciation, raising concerns about the tokenomics of XRP.

I will have to think about that but has anyone properly considered why the creators of the XRPL decided on an issue of 100 billion coins instead of a smaller number. https://t.co/zZaYTX9Gmx

— bill morgan (@Belisarius2020) December 14, 2023

Morgan, in response to Ayala’s insights, expressed the need for careful consideration regarding the decision to issue 100 billion XRP rather than a smaller number. This opened the door to a broader conversation about the impact of circulating supply on the asset’s value and market dynamics.

Notably, another X user contributed to the discussion by referencing former Ripple employee Bob Way’s explanation of the numeric intricacies underlying XRP’s design. Way emphasized that, from a technical standpoint, both 21 million Bitcoin and 100 billion XRP are represented by 64-bit integers.

Ripple’s Chief Technology Officer, David Schwartz, also joined the conversation, confirming the technical considerations behind the decision.

Right. We wanted integer amounts that fit in 64-bits with a bit left over for a sign and enough extra space that we wouldn’t have to worry about additions overflowing. We wanted an amount humans could understand and a reasonable amount of divisibility.

— David “JoelKatz” Schwartz (@JoelKatz) December 15, 2023

The CTO highlighted the preference for integer amounts that fit into 64 bits, leaving room for a sign and additional space to prevent complications like overflowing during additions. Schwartz mentioned that they wanted an amount that humans could comprehend and a reasonable level of divisibility.

Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.

Source