Ethereum Sidechain Threatens XRPL’s Value, Claims Ripple Official
The Ethereum Sidechain and the Threat to the XRP Ledger
A discussion was recently sparked about the impact of the Ethereum Virtual Machine (EVM) on the XRP Ledger (XRPL). Thomas Silkjær, the head of the XRPL’s compliance department, commented on this, referring to the EVM as the biggest attack on the protocol.
The Role of XRP on the Ledger
Silkjær expressed this opinion in response to a post stating that XRP is not being utilized on the ledger. For those who don’t know, XRP is the native token on Ripple. The XRPL, on the other hand, is the decentralized public blockchain that enables XRP transactions, the development of smart contracts, and cross-border payments.
The EVM Sidechain and Its Impact
According to Silkjær, XRP locked on the EVM sidechain is no different than XRP embedded in another chain. However, he noted that the EVM sidechain does not help Ripple attract new developers. He added that the sidechain does almost nothing for the XRPL in terms of utility.
The Development of the EVM Sidechain
Ripple began testing an EVM-compatible sidechain through its developer arm RippleX in October 2022. Since then, the sidechain has been helping users work on Ethereum by bridging via the XRPL. In this case, XRP is the native token and the gas fees are collected in the token, while validators also receive rewards in XRP.
However, Silkjær emphasized that his view is a personal one and not necessarily shared by Ripple’s development team. To support his argument, he wrote: “The attack is not that one can bridge to an EVM chain, because that is already possible. It is the fact that it is being driven forward with marketing that sounds as if it were “the XRPL”. The XRPL is being diluted by the entity that should actually protect it.”
Surprises on the Other Side
This development might be surprising for the overall crypto community. One reason for this might be related to the statement by RippleX in 2023. According to the team, the EVM should help make the XRPL more developer-friendly. The integration should also facilitate access to Decentralized Finance (DeFi) for XRP users. But with the public statement of one of its insiders, it seems that the XRPL has not yet achieved this.
The Activity on the XRPL
Following the discussion, AMBCrypto investigated what is happening on-chain on the XRPL. According to our findings, the total number of XRP issued on the ledger has increased since December. This suggests that transactions on the network have increased. Another indicator we looked at was the daily new number of created XRP trustlines. At the time of publication, the number had risen to 1526, suggesting that the protocol was busy and users were active.
It seems that Silkjær’s opinion does not match our findings. However, as our investigation focused on the users, it could be that the standpoint was related to development activity. If that’s the case, Silkjær might be right. What we cannot conclude, however, is whether the EVM is the problem.