U.Today - Software developer and seasoned XRP Ledger ecosystem enthusiast Wo Jake shared his thoughts on the most important challenges for XRPL in terms of making its XRP tokenomics reasonable, inclusive and democratic. He proposed three ideas on how to make participating in the XRPL consensus more attractive for retail users.
Technically competitive, but economically terrible: What's wrong with XRP Ledger?
When it comes to monetary incentives, XRP Ledger still lacks viable reward mechanisms and adheres to a poor and unfair model of network. As such, it underperforms in this regard compared to mainstream EVM ecosystem blockchains, Jake admits in his recent Twitter thread.This status quo is dangerous for real-world adoption of XRP Ledger and XRP-based solutions, he added. Meanwhile, representatives of the banking segment are aware of the technical competitiveness of both the network and its core asset.
For Jake, introduction of a non-network-securing incentive model to XRP Ledger looks like a viable solution to some of the aforementioned challenges. He started a discussion, and over 50% of his followers agreed that XRPL needs incentive mechanisms.
To start with, Jake recommended to focus on three elements of XRP Ledger: Hooks, balances and periodical lockups. For instance, the creator of this or that Hook can be rewarded once someone uses this hook and destroys XRP gas using this Hook.
Also, users of the XRP cryptocurrency can be rewarded for holding tokens during a predetermined period of time.
Can Hooks change game in XRP tokenomics?
Last but not least, the lockup instruments should be able to distribute XRP rewards for locking XRP in on-chain liquidity mechanisms.As such, the tokenomics of XRP Ledger can have a boost once the Hooks amendment is live. As covered by U.Today previously, the Hooks activation is designed to enhance XRPL tooling with basic smart contract functionality.
A month ago, on June 6, 2023, the Hooks amendment successfully passed a third-party security audit by the U.S.-based vendor FYEO.