Ripple CTO Says Lowering XRPL Reserves Unlocks More XRP for All Accounts

The Ripple CTO David Schwartz confirms that the decision to lower the XRP Ledger (XRPL) account reserve fees unlocks more XRP accounts.

As crypto adoption grows, blockchains are constantly evolving to serve users better and improve experiences. The XRP Ledger (XRPL), the blockchain behind the XRP token, is no different.

Earlier this month, the community reduced the XRPL account reserve to encourage adoption. With the evaluation of the XRPL account reserve set to be a continuous and evolving process, Ripple CTO David Schwartz, one of the key architects of the XRPL, has offered suggestions to ensure better stability and predictability for users.

Voting Configurations

in an X post on Tuesday, December 17, Schwartz suggested changes to the XRPL account reserve voting process.

For context, the XRPL account reserve refers to the amount of XRP a user must lock up to activate an account on the XRPL (the base reserve) and hold objects like NFTs (owner reserve) to prevent spamming of the network by malicious users.

The account reserve is typically decided by a fee voting process by validators. Validators can set a preferred account reserve parameter once every 15 minutes, with the network adjusting to the median of the settings of trusted validators.

Some thoughts on recent discussion around XRPL account reserves and the voting mechanism to change the amount:

First, this mechanism’s main purpose is to coordinate feature activation, not as THE primary governance tool for the network. It can govern, but not particularly well,…

— David “JoelKatz” Schwartz (@JoelKatz) December 17, 2024

According to Schwartz, however, the voting process has one problem: it requires validators to be active to change their preferences.

The prominent XRPL figure contends that in instances where validators are inactive, votes may be too close, causing the network to bounce between two reserve levels and creating a bad user experience.

To make the process more stable and enable a predictable user experience, he suggested that the fee voting configuration have a default “off” setting so that voting by validators is more explicit.

The XRPL architect also proposed that the default setting should have no preference for lowering or increasing the reserve unless the validator explicitly makes the change.

Beyond offering improvements to the fee voting process, Schwartz shared his two cents on the recent reduction in the account reserve parameter. On December 2, the network adjusted the base reserve from 10 XRP to 1 XRP and the ownership reserve from 2 XRP to 0.2 XRP.

A Long Overdue Change?

Commenting on the account reserve reduction, Schwartz contended that the change was long overdue. Still, he maintained that the extent of the reduction may have been a bit more aggressive than he hoped.

The concern comes as some fear that the network could be exposed to denial-of-service attacks if the account reserve fee becomes too low.

Moreover, raising account reserves after the fact will likely be more tricky. This is because increasing the reserve would mean locking up XRP previously available to users, which could raise concerns of excessive influence over their holdings.

In light of these risks, Schwartz called for a thoughtful approach as the network continued to evolve.

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