Similarities to Gold
Zach Rector, a crypto expert, has compared XRP to gold due to their shared characteristics as investments. According to Rector, both XRP and gold are:
- Currencies
- Commodities
Ripple’s Perspective
Ripple’s CTO, David Schwartz, agrees with Rector’s assessment. He emphasizes that XRP is:
- A “raw good” traded in commerce
- Each XRP is equivalent to every other XRP
- A commodity by definition
Schwartz refutes claims that XRP’s value is derived from external obligations. Instead, he attributes its value to market factors such as supply, demand, and investor sentiment.
Community Reaction
Rector’s comparison has sparked debate within the crypto community. Some users argue that XRP is not gold because it is an inflated currency used by banks. Others suggest that it could be a “neutral bridge asset” backed by gold.
SEC Lawsuit
In 2020, the SEC filed a lawsuit against Ripple, alleging that XRP is a security and that its sale was an unregistered securities offering. However, a judge ruled in 2022 that XRP is not a security when sold to retail investors through digital asset exchanges.
