Wietse Wind, founder of Xaman development team XRPL Labs, has called for a reduction in the XRP Ledger’s (XRPL) account reserve fee.
Taking to X, Wind recently explained why he supports reducing the account reserve from 10 XRP (about $5.50) to 1 XRP ($0.55), a 90% drop. His argument centers on making the XRPL more accessible, especially to users and projects in regions with lower purchasing power.
Currently, the XRPL requires users to hold a reserve of 10 XRP in their accounts, which they cannot access while the account remains active. This reserve fee aims to prevent excessive account creation, protecting the ledger from becoming overcrowded with unused or spam accounts.
However, Wind believes this deterrent also impedes growth, especially for new users. Others have also raised similar concerns. XRPL protocol SpendTheBits called the community’s attention to the issue last November, promoting a response from Ripple CTO David Schwartz.
Two months back, early Bitcoin investor Davinci Jeremie also spotlighted how the reserve fee poses a barrier to adoption. Through his latest commentary, Wind suggested that reducing the reserve to 1 XRP would open the door to greater network participation.
Wind’s Proposed XRPL Changes
Besides reducing the reserve fee, Wind also mentioned other proposed changes for the XRPL in his earlier post. He revealed that XRPL Labs has configured its validator to support a reduction in the account reserve and also an increase in transaction fees.
Notably, the transaction fee would rise from 10 drops (a small fraction of XRP) to 200 drops. This increase, while still maintaining affordability, would make transactions slightly more expensive to help prevent spammy transactions.
Wind also proposed lowering the object reserve on the XRP Ledger from 2 XRP ($1.1) to 0.2 XRP (about $0.11). The object reserve refers to the amount held for other items like trust lines and escrows within XRPL accounts.
Encouraging Wider XRPL Adoption
Notably, in his latest disclosure, Wind argued that lowering the account reserve will benefit individual users and projects operating on the XRPL. To him, a 1 XRP reserve is an amount that businesses can more easily sponsor, as opposed to 5 or 2 XRP.
Account reserve is currently 10 XRP.
We will vote for 1 XRP.
People wonder why. Why not 5. Why not 2.
It’s impossible to quantify the amount of users being scared off by a 2 or 5 or 10 XRP reserve. We don’t know who these users are, what they will come for (chicken egg, use… https://t.co/anT5DvaV2i
— WietseWind (🪝🛠 Xaman @XRPLLabs) (@WietseWind) October 16, 2024
For instance, companies like Xaman Wallet (formerly Xumm) could cover this cost as part of onboarding new users. This would make it simpler for businesses to bring users into the XRP ecosystem, reducing the friction that comes with requiring users to fund the 10 XRP reserve themselves.
He argued that the reduction would make it easier for people to open accounts and also encourage projects to adopt more sustainable monetization strategies.
Potential Challenges
Despite the potential benefits, Wind admitted that lowering the account reserve could lead to a spike in activity on the XRPL, which may present challenges. However, Wind views this as a good problem to have.
He argues that dealing with increased usage and its infrastructure challenges would be a positive development. Wind believes the XRP community is prepared to handle such challenges, whether that requires improving hardware, optimizing configurations, or scaling horizontally.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
