Ripple’s CTO Defends Low XRP Ledger Activity, Points to Off-Chain Bank Settlements
Ripple’s Chief Technology Officer, David Schwartz, has responded to growing concerns over declining on-chain activity on the XRP Ledger (XRPL), clarifying that many institutional transactions are being settled off-chain. This statement comes amid criticism from the crypto community about Ripple’s claimed partnerships with hundreds of banks, which have yet to translate into visible, high-volume usage of the ledger.
According to Schwartz, the slow on-chain adoption among banks is not a sign of failure but a result of how financial institutions currently operate. Most prefer settling transactions off-chain due to regulatory, compliance, and privacy concerns. He acknowledged that Ripple avoids using XRPL’s decentralized exchange for institutional transfers because it cannot guarantee that liquidity providers comply with anti-money laundering laws or other legal requirements.
Despite these limitations, Schwartz remains optimistic about the ledger’s future. He believes more banks will move toward on-chain settlement as regulatory clarity improves and technology matures. He also suggested that Ripple is exploring new ways to give institutions access to secure, trusted liquidity possibly through permissioned environments or upgraded infrastructure.
Recent data shows a significant decline in XRPL usage, with new wallet creations and transaction volumes down by as much as 40% in the first quarter of the year. However, decentralized finance (DeFi) activity on the ledger has held up relatively well in comparison, with trading volume on XRPL’s decentralized exchange dropping by a smaller margin.
In response to changing dynamics, Ripple has announced a shift in how it reports data on XRP usage. Instead of its regular quarterly market report, the company plans to share updates through its official channels in a more real-time, accessible format. This move is seen as part of a broader effort to increase transparency while adapting to the evolving role of XRP in the global financial ecosystem.
Schwartz also highlighted how the XRPL remains strategically positioned to support tokenized assets, stablecoins, and cross-border payments. He pointed to the growing trend of major financial players embracing blockchain technology, not by building private networks, but by integrating with open public ledgers like the XRPL. In his view, this strengthens the long-term value proposition of Ripple’s platform.
While critics continue to question the gap between Ripple’s partnerships and the actual on-chain activity, the company maintains that its vision for the XRPL remains intact. According to Schwartz, the focus is on building the tools and trust required for institutions to eventually transition more of their operations onto the ledger.
As the crypto industry matures and regulatory frameworks become more defined, Ripple is betting that the utility of XRPL will become more evident, not necessarily through high transaction counts today, but through deeper integration in the infrastructure of global finance.
