David Schwartz, Ripple's chief technology officer emeritus, has criticized fee revenue as a metric for evaluating blockchain performance, arguing it overlooks the costs borne by users. His comments came in response to a proposal to significantly raise transaction fees on the XRP Ledger.
In an exchange on social media on October 4, Schwartz stated that fee revenue measures "how much friction the chain didn't remove." He distinguished between the interests of those collecting fees and those paying them, asking: "If you represent the people who collect the fees, then fees are great. But what about the people who pay the fees? Who cares about their interests?"
Fee Increase Proposal Focuses on Token Burns
An XRP Ledger participant suggested raising the base fee by 10-fold or 100-fold, framing the increase as a way to burn more XRP tokens rather than generate validator income. Unlike networks such as Bitcoin where fees compensate miners, XRP Ledger transaction fees are permanently destroyed, reducing the overall supply of XRP.
The proposal argued that even with higher fees, transactions could remain well under one cent while increasing the amount of tokens burned per transaction. The actual dollar cost would depend on XRP's price. Changes to the XRP Ledger's base fee require consensus among trusted validators rather than unilateral action from Ripple or company executives.
Adoption and Transaction Costs
The fee proposal raised a broader question about whether larger token burns justify higher transaction costs or whether inexpensive payments better support adoption of the network. Ripple has described XRP's practical applications in payments and liquidity provision, as well as its potential use with other assets including stablecoins and tokenized assets.
The current documented minimum standard transaction fee on XRP Ledger is 10 drops, equivalent to 0.00001 XRP, with costs potentially increasing under network load.
