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XRP Too Slow And Centralized For Banks: Nano Founder

Banks won't use a token that has a supply controlled by a private company


XRP adoption is unlikely as it’s slow and too centralized, says the founder of Nano (NANO). He thinks banks are unlikely to accept it as it would give Ripple Labs, XRP’s creator and biggest hodler, a near-monopoly on the entire Forex market.

Colin LeMahieu, who created the Nano cryptocurrency, explained to Crypto Briefing that the financial sector couldn’t use XRP. In his eyes, the fact that Ripple controls more than half of the total supply – with no obligation to spend or burn it- makes it “too risky” for the banks.

“Many FX firms I’ve talked with have considered and dismissed them based on the fact that one company holds over 50% of the market cap,” wrote LeMahieu in an email. “A single company holding this much of a position on a currency isn’t something they would accept from a risk perspective.” 

Is XRP centralized?

The XRP token is specifically designed as a transaction network for the financial sector. Banks can convert fiat funds into XRP and then send it to the recipient-bank, who convert it back into the local currency. Whereas traditional payment transfers can take up to three days to settle, XRP transactions can complete in seconds.

More than 100bn XRP tokens were created, exactly six years ago today. Out of the total supply, the creators retained 20%; the remaining 80% was given to Ripple Labs. Since then tokens have gradually been distributed to users.

In May, the company moved the supply into an escrow account; this gives it access to a billion tokens every month. Nearly 41bn tokens are currently in circulation, with the remaining 59% still held the Ripple escrow account. In Q3 2018, Ripple sold 400m XRP tokens. It would take at least 5 years* for the company to distribute the remaining supply.

Up until this summer, it was common practice to use ‘Ripple’ and ‘XRP’ interchangeably when describing the token. But in an email sent out in July, Ripple Labs dissociated themselves from the XRP token, which they described as an “independent digital asset”. 

The company still owns more than 60% of the XRP total supply, but as the Chief Marketing Strategist explained to The Street at the time, this didn’t necessarily mean they controlled it, “We happen to own a lot of XRP – we own a lot of cash, chairs, and computers.”

Nano is faster than XRP

Nano is fast. Most blockchains use a legacy structure; blocks are processed and confirmed sequentially. The Nano blockchain is based on a block-lattice architecture. Each user effectively has their own blockchain that is incorporated with other Nano users.

Tests in October found a Nano transaction to Binance completed in roughly three seconds, seven seconds faster than XRP. Stellar Lumens (XLM), another settlement token, could complete in six seconds.

Unsurprisingly, LeMahieu believes Nano is the best solution for the settlements market; it’s a fast and feeless payments solution. Banks want to speed up a process that can take days to confirm. He points out that Nano allows near-instant settlement and also lowers overhead costs, meeting the real-world priorities for most FX traders.

LeMahieu also argues Nano is more decentralized than XRP because the total supply is circulation. Surplus tokens not sold or distributed were burnt. No private entity, or even the Nano team, owns more than half of the supply.

“Our biggest differentiator to XRP is that we’re a true, decentralized currency rather than a company”, he wrote. “This translates well to the financial sector which will never really accept a private entity that controls ~50% of the currency supply for various purposes.”

XRP Adoption

Ripple Labs prides itself on its number of partnerships. Many of these are with well-known international banks and financial institutions. Crypto Briefing found out in October that the National Bank of Kuwait (NBK) was in the process of implementing xCurrent, a fast messaging service used by banks before, during and after a cross-border transaction.

LeMahieu believes most banks wouldn’t be able to adopt xRapid, the payments solution that uses XRP, because Ripple controls most of the supply and is too centralized.“XRP is taking the strategy of trying to insert itself as a new, central trading platform,” he wrote. “This is unlikely to be accepted by FX firms since it would be a central point of failure and puts one firm in monopoly control of the entire market. Regardless of how good they think their governance will be, this will be unlikely to ever be accepted.”

The number of banks actively implementing xRapid remains uncertain. We contacted numerous banks who had said previously they were testing it – including American Express, Credit Suisse, UBS and Barclays. All either declined to comment or never returned our emails.


The Nano team itself isn’t engaging in the FX market. Traders can build inter-dealing services on top of the network. Banks could add currency pairs and simply swap into Nano for a cross-border transaction, which would be faster and cheaper than the traditional settlement systems. With the total supply distributed among users, it would also be more acceptable from a risk perspective.

LeMahieu is confident interest in Nano will grow, and says that he is already in talks with a few interested traders. The main selling point is still its speed, three times faster than XRP. He says that this makes it an obvious alternative, “There’s little reason to market this as it’s a natural competitive advantage, anyone able to execute faster trades will win every time.”


*Clarification: an early version of this article overstated the time it would take to fully distribute the XRP token supply. It will take 52 months, not years, to unlock the full XRP escrow. The 5 years is worked out if Ripple Labs sold all 1bn XRP tokens unlocked every month – it will most likely take longer. 

The author is invested in digital assets, but none mentioned in this article.


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  1. Robert says

    XRP moves in 1 to 3 seconds. No need for FUD. Please correct your article. How long an exchange takes to credit an account is immaterial. The question is, how long does the network take to process a transaction….

    1. Bvdon says

      Ok, but xrp is still centralized and supply is largrly owned by Ripple. Nano is decentralized, 100% distrubuted, low supply of 132 million, developers hold less than 4%, a very modest amount to fund development.

      1. Wayne says

        Xrp becomes more decentalized the more banks use it as all their transfers will release xrp from escrow on to the open market thus reducing Ripples shareholdings. Nano low supply doesn’t make it viable for banks to use. Supply has to be large and unit price high to create stability which will reduce volatilty, something banks money insurers require as they will not support crypto in its current unregulated state

        1. Nano observer says

          Your low supply argument against Nano doesn’t makes sense. Each Nano is divisible 10^30 times.

          Your price argument against Nano also doesn’t make sense because it’s the amount of adoption and market cap a currency has that determines its stability, not its price. Even going by price, the price of Nano is higher than XRP’s, so according to your logic Nano is better than XRP in this regard.

          Your argument about decentralization misses the point. XRP is currently centralized since Ripple holds over 50% of it. Nano is already decentralized.

      2. Someone says

        Nano is a joke if they are coming out attacking XRP. Who makes up the team of Nano? I don’t even care to look. Why? This is the absolute first I’ve heard of Nano. Ripple is made up of the best of the best in the industry. Do you seriously believe they haven’t thought through every part of this in great detail? Do you seriously not see that they have employed people with not just experience, but extensive experience in every aspect of this? Just look at one very critical employee of Ripple, David Schwartz, who is a former National Security Employee. Need I really go down that list??? They know exactly what they are doing!! This stupid centralized argument is getting old! Nano may be trying to get a small piece of the action. There will be those that do. XRP being a monopoly is ridiculous. Most everything will be digital in the decades to come. So get real and not make accusations that aren’t warranted! Since you saw the need to publish such trash, do your real job as a journalist and back up what you say with actual sources. Then to make yourself even more credible, lay out a list of accomplishments by Nano. Who cares what the dude says that manages Nano and it’s marketing! What has he accomplished ?? That would be a more credible story. If it’s entirely in circulation, why aren’t they huge in the news? Sounds like they still have a very long ways to go. Come on folks, every Tom, Dick and Harry are waiting to take your money. A single statement by one person who has his own agenda is not worth anyone’s time. When they prove themselves, they will be all over the news. I know of one that already is. Peace!

        1. Nano observer says

          Nano isn’t a joke. It may be the most impressive project in the entire cryptospace. You admit you never heard of it before, your opinion of it has no merit.

          The Nano team is among the best of the best in the cryptospace. Nano is a truly decentralized currency. It is secure, almost instant, and feeless. Third party tests have shown it to be the fastest cryptocurrency. Nano is designed from the ground up to be a background, ubiquitous Internet protocol like http, the most efficient and effective P2P transfer of value protocol in existence.. Its consensus model is probably the best of any crypto. Nano’s block lattice architecture is widely regarded as revolutionary. These are impressive accomplishments from that ‘dude’. In addition, Nano has a large, vibrant community and the ecosystem development is thriving. Nano has accomplished all this through organic growth with almost no marketing.

          The points made by Lemahieu about XRP, and printed in this article, are not trash, they’re significant and very insightful. You haven’t actually addressed them in your screed, let alone rebutted them.

          1. whale says

            Nano is Rubbish. For attacking the wrong Coin backed and Supported with world class Team. Nano is Bullshit. Period

      3. Robert says

        There are two meanings to the term ‘centralized’ in the cryptosphere. One pertains to processing and the other relatively younger meaning, is about coin issuance. When the word ‘centralized’ was bandied about in the early days of crypto, it was about transaction validation privileges. It was about “How many parties are involved in the validation process?” If there is only 1 party, then the process is centralized. (i.e. only one entity makes entries on the ledger). The more participants there are, the more “decentralized” it is. Like it or not, Ripple is far more decentralized than BTC, ETC and many others. For example, the last I knew, 80% of BTC transactions are processed by a couple small groups in China.

      4. whale says

        Reason Why its useless. International settlement and FIs need Huge supply becos they process in Quadrillions not Million mentality you guys are thinking of. Aside this, There is an undisclosed purpose for Ripple to have Huge supply

      5. blabla says

        132Million bro ? you know how much for SWIFT settlement in one years ?
        it will very volatile since the supply amount so little …
        you dont understand dude ?

  2. Pete says

    Who is this guy? A sales guy for Nano? Please…..

    It’s NOT all about the difference of one second, it’s about the 5 year head start and the trust already gained in the space, working with regulators, banks and governments, not against. Sounds like a case of extreme sour grapes to me. 🙂

  3. Wayne says

    The only problem with your theory is that if banks start to use xrp Ripple are releasing more onto the open market from escrow to accomodate the transfer and reducing Ripples holdings. Basically the more xrp banks transfer, the more Ripple becomes decentralized. Next..

  4. Sallad says

    Ripple Labs is using the billions of XRP in escrow to distribute to banks. How is Nano going to be distributed to banks if all Nano have been released? Banks would have to purchase Nano over the market to fund their bridge payments. Why would they do this when they can partner with Ripple and be gifted the bridge currency????

    1. Salamander says

      “Why would they do this when they can partner with Ripple and be gifted the bridge currency?”
      Nice, so XRP holders are giving their money to banks for free?

  5. Sam says

    There is a lot of wrong information in this article…

  6. Dutchpanda says

    You guys just won the prize “writing the most silly and retarded article about XRP ever.” Congratulations!

    You are proudly selected for round two: price: a table size refrigerator…

  7. Munson says

    What a complete waste of 2 minutes of my life. XRP will supersede BTC in the next 3-5 years and that is inevitable. Ripple are way ahead in all aspects …fact. I won’t even entertain HODLing any other cryptocurrency, XRP is the sensible choice.

  8. KRÓL BITCOIN says

    FUD, FUD. Decentralization? Escrow? Only lies.
    Educate yourselves.

  9. Bob F says

    This might be one of the dumbest articles I’ve ever read. Ripple (the company) has a big chunk of XRP in escrow and the amounts that are released/sold are completely transparent. Amounts that founders hold is completely transparent and the amounts they can sell at any given time are known (they cannot just dump everything on the market). People lose their mind because XRP is a digital asset working with the banks… sorry but no one living on this earth presently will see banks, governments totally dissolve in some anarchist utopia… not happening.

    So you have a decentralized (yes it is) digital asset associated with a great company with strong, aggressive, professional team pushing a use case (movement of money across boarders) trying to solve a multi trillion dollar problem… and somehow it needs to be spun as bad I guess. Ripple already has like 200 partnerships with banks and financial institutions (and growing by the week)… many of which will be using xRapid (the XRP solution which is now live). A digital asset that can be used as a “currency” (very fast and cheap) and also has real world utility in a sea of useless whitepapers… how awful.

    Another company totally independent of Ripple (R3 – a blockchain software firm) just adopted XRP. And you have other use cases/ businesses being developed using XRP/XRP ledger. In my opinion there is far more “buzz”, actual use cases, partnerships around XRP than an other crypto presently.

    I know nothing about NANO other than it’s supposed to be fast… I don’t think it has proven much (?). I hope it does well, why not? Successful adoption of legit projects will help other legit project. Unfortunately the founder of NANO seems to have an attitude akin to the 10 year old fan boys on Reddit that act like they root for their favorite sport team and are deathly afraid a rival team (coin) will finish ahead of them in the “standings”… what a joke.

  10. Hudi says

    Being a slightly slower digital asset > Being an illiquid digital asset

  11. Kpuff says

    You keep bringing up this centralized argument that revolves around the amount of xrp ripple holds. Just going to give you some insight. The 55 or so billion XRP that they hold. On the xrp ledger if we do not like how ripple is handling their 55b xrp, there can be an amendment passed on the xrp ledger to take that away from them. Hence the decentralized nature of the ledger. Amendments can be voted on, on the ledger and change aspects of it. Now us as holders like the way that they handle their escrow and distribution to banks and FIs because first of all they do not sell on the open market, they sell on the OTC market, hence no price fluctuation. Plus all the xrp sold is going to the banks and FIs that plan on using xrp as a liquidity tool. That’s all folks!!

  12. JR says

    Wow! What planet are we on? Earth 25? In what dimension? Who are you? Who paid you to come public and tell all these lies? Seriously no one can be this stupid to come out with these false statements. There’s absolutely no truth to anything you said. It’s so transparent you were paid to say these things. Hope it was worth being the biggest laughing stock on the internet soon!

  13. Drew says

    XRP and NANO are both missing the ball – Banks don’t want transaction speed, they want and need data.

    When it come to transactions over $10k, banks are obliged by strict regulation to investigate the transaction trail for money laundering, or face potential billions of dollars in fines: this is why payments can take days to process. The more data a bank has regarding a specific customer (KYC) and the transaction (KYT), the faster the bank can safely clear the transaction.

    Data is the transaction bottleneck, and neither XRP nor Nano address that.

    Ivy, on the other hand, is designed to address that specific dire need. Their platform embeds over 120+ KYC and KYT data points directly into each and every transaction, far exceeding all competition. Enough data in fact to also process cryptocurrency to fiat transactions direct into banks on a global scale, enabling banks to cash in on crypto and be open to that revenue stream.

    1. David says

      XRP has complete transparency when it comes to a transaction for banks and you can quickly trace it back to see all of the transactions.

  14. Christian says

    Seems there is something wrong with the escrow time estimates:
    “The escrow consists of independent on ledger escrows that release a total of one billion XRP each month over the next 55 months. This provides an upper limit on the amount of new XRP that can be brought into circulation. The amount of XRP actually released into circulation will likely be much less than this. Any additional XRP leftover each month will be placed into a new escrow to release in the first month in which no escrow currently releases.”

  15. Dummy says

    I laid a massive egg and it stunk like a pigs chi chi’s

  16. Silhouette says

    Did you receive money from nano?

    XRP has credibility and transparency – can’t get that with nano

  17. T_Dickson says

    i wonder what would happen iin the crypto world if Satrhowhi were still around calling out all these shitcoins and their clueless founders

    1. T_Dickson says

      6 hours ago
      i wonder what would happen in the crypto world if Satoshi were still around calling out all these shitcoins and their clueless SCAMMY founders. not drunk yet btw

  18. sumas xrp says

    đúng là một tên điên rồ viết bài này. còn nếu là người sáng lập nano ông ta cũng điên nốt. không ai có thể đánh bại xrp đến thời điểm này.

  19. David says

    Firstly there is. I such thing as an XRP fork. XLM is not a fork is XRP.
    Secondly this is just all BS because XRAPID settles in 3-4 seconds .

    You guys just can’t learn to do your research and continuously post rubbish

  20. Takutakun says

    Thunder will fire You this Xmas for wasting 3 minutes of my Merry Xmas.

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