The Context Behind Schwartz's Admission
On July 18, 2022, financial author Linda P. Jones highlighted a Forbes profile of David Schwartz, Ripple's Chief Product Officer and co-creator of the XRP Ledger. The article revealed Schwartz's decision to accept Ripple stock instead of XRP during the company's early days—a choice he now views as potentially misguided.
Jones noted that other Ripple founders opted for XRP allocations, suggesting the token itself wasn't problematic. This prompted public speculation about Schwartz's reasoning, leading to his candid Twitter response.
Schwartz's Candid Reflection
The Liquidity Factor
Schwartz acknowledged the likely error in his decision, stating:
"The jury is still out, but it probably turned out to be a pretty big mistake. A number that was thrown around was 500 million XRP. And, of course, XRP is nearly perfectly liquid."
👉 Discover how XRP's liquidity compares to traditional assets
The Salary Dilemma
He clarified that his actual choice wasn't between stock and XRP, but rather:
- Taking XRP as compensation vs. receiving immediate salary payments
- Needing quicker cash flow during Ripple's startup phase
- Assuming he could later purchase XRP on exchanges
Risk Assessment in Hindsight
Schwartz admitted his miscalculation of early XRP holders' risk tolerance:
"At the time, [accepting only XRP] seemed insane... most people involved 8 years ago probably wish they'd taken greater risk."
XRP's Market Journey: Resilience Amid Challenges
Volatile History
- 2017-2018: Peaked as #3 cryptocurrency with numerous bank partnerships
- 2020-2023: Faced multiple lawsuits including SEC's high-profile case
- 2024: Regained stability with $17.2B market cap (#7 ranking)
Current Positioning
Despite U.S. regulatory uncertainty, XRP has gained:
- Strong adoption in Europe and Asia
- Continued utility in cross-border payments
- Price stability around $0.35 (as of 2024)
👉 Explore XRP's current use cases in global finance
Investment Perspectives on XRP
Pros
- Established real-world payment network
- Faster transaction speed than many competitors
- Growing institutional adoption outside U.S.
Cons
- Ongoing regulatory uncertainty in key markets
- Competition from other payment-focused cryptos
- Dependence on Ripple's business success
FAQs: Addressing Common XRP Questions
Q: Why did Schwartz regret choosing stock over XRP?
A: XRP's long-term value appreciation outpaced Ripple's private stock growth, and its liquidity made it easy to convert when needed.
Q: How much XRP could Schwartz have received?
A: Negotiations suggested ~500 million XRP (worth ~$175M at current prices).
Q: Is XRP a good investment today?
A: While promising, investors should consider both its payment network utility and regulatory risks.
Q: Where is XRP most widely accepted?
A: Primarily in Europe and parts of Asia where regulatory clarity exists.
Key Takeaways for Crypto Investors
- Early Decisions Matter: Founder choices can significantly impact long-term outcomes
- Liquidity Premium: Easily tradable assets often outperform restricted ones
- Risk-Reward Balance: Higher early risk sometimes yields greater rewards
- Ecosystem Growth: Project success depends on both technology and adoption
For those considering XRP investments, thorough research into both its technological advantages and legal landscape remains essential. The project's ability to navigate past challenges suggests resilience, but as Schwartz noted—the final verdict on XRP's long-term success remains undetermined.