Ripple's XRP: A Divisive Contender for U.S. Crypto Reserve

Ripple's XRP Faces Scrutiny Amid Push for U.S. Crypto Reserve Inclusion

Ripple, the company behind the cryptocurrency XRP, has been actively promoting its native token as a potential component of a U.S. crypto strategic reserve. However, the proposal has sparked intense debate within the cryptocurrency community, with industry leaders expressing skepticism about XRP's suitability for such a role.

Ripple CEO Brad Garlinghouse has expressed optimism about the asset's potential inclusion, aligning the company's goals with the current administration's emphasis on promoting American innovations. Garlinghouse believes that incorporating assets like XRP alongside Bitcoin would be consistent with efforts to support U.S.-based companies and technologies.

Despite Ripple's efforts, many industry leaders are skeptical of XRP's suitability for a U.S. crypto reserve. Ryan Selkis, founder of Messari, has been one of the most vocal critics. Selkis advocates for Bitcoin as the sole cryptocurrency fit for such a reserve, citing its decentralized nature, reliance on energy-backed mining, and dominant global position as critical factors.

Selkis also criticized Ripple's lobbying efforts, accusing the company of aggressively promoting the token despite concerns about its centralized distribution and the large volume of XRP held by Ripple. This criticism highlights broader hesitation among industry leaders about moving beyond Bitcoin when considering digital assets for a strategic reserve.

The U.S. government has shown interest in exploring the feasibility of a digital asset reserve. A working group has been tasked with evaluating the concept, with Bitcoin initially dominating early discussions. However, attention has recently shifted toward other assets, including XRP and Solana, particularly those marketed as "American-made" technologies.

Ripple's lobbying efforts have drawn both support and criticism. Advocates argue that including a diverse range of digital assets could strengthen the foundation of a U.S. crypto reserve. However, critics warn that prioritizing assets like XRP could undermine the initiative's credibility. Riot Platforms and other Bitcoin-focused advocates have expressed concerns that Ripple's push for inclusion may detract from Bitcoin's proven stability and decentralization.

A central point of contention is Ripple's substantial control over its native token, XRP. The company reportedly holds above 50% of the total token supply, raising questions about its decentralization and suitability for a government reserve.