Ripple CTO Emeritus David Schwartz has joined the ongoing discussions about whether banks will adopt XRP — and, in turn, boost its price.
His comments come as questions grow around XRP’s long-term relevance in a market increasingly dominated by stablecoins. In response, Schwartz highlighted several advantages that cryptocurrencies like XRP have over stablecoins.
Key Points
- XRP offers a neutral bridge across currencies, unlike stablecoins tied to single fiat systems globally.
- Stablecoins carry control risks like freezing and clawbacks, adding counterparty exposure in sensitive use cases.
- Schwartz argues crypto’s upside potential can outweigh volatility, especially in long-term or non-stability-driven scenarios.
- He dismisses claims banks would avoid XRP, saying firms won’t reject profitable solutions just to avoid enriching Ripple.
Stablecoins vs XRP: Where Each Fits
Schwartz acknowledged that stablecoins do have clear advantages in certain use cases. He explained that when volatility is a major concern, stablecoins or regulated assets with trusted counterparties can be a better option.
However, he argued that this does not make cryptocurrencies like XRP obsolete. Instead, each serves different roles depending on the application.
1. Limited Flexibility Across Global Currencies
According to Schwartz, one major limitation of stablecoins is that they are tied to a single fiat currency.
In a global financial system where multiple jurisdictions operate with different native currencies, a single stablecoin may not meet all needs. He noted that a stablecoin with the exact properties required, such as regulatory clarity, liquidity, and trust, may not even exist for certain regions.
This is where XRP can offer an advantage, acting as a neutral bridge asset not tied to any single fiat system.
2. Control Risks: Freezing and Clawbacks
Schwartz also highlighted the control mechanisms of stablecoins, which issuers can freeze. Using Ripple as an example, he noted that regulated entities must comply with court orders, which means user funds could be affected by legal or political decisions.
This introduces a layer of counterparty risk that cryptocurrencies aim to avoid in cross-border or censorship-sensitive use cases.
3. Upside Potential Favors Crypto in Many Cases
Finally, Schwartz argued that for many use cases, the potential upside of cryptocurrencies outweighs their volatility.
He explained that if stability is not essential, such as in long-term escrow scenarios, assets like XRP or Bitcoin may be preferable to fiat-backed stablecoins. Unlike fiat currencies, which typically do not appreciate significantly, cryptocurrencies offer potential value growth over time.
Bank Adoption and XRP Supply Concerns
Notably, the discussion was sparked by crypto commentator Mason Versluis, who questioned why global banks would use XRP if it could significantly enrich Ripple given its large token holdings.
He pointed to Ripple’s 38 billion XRP holdings and argued that banks may avoid adopting a cryptocurrency in such concentrated ownership. The concern centers on whether institutions would be comfortable indirectly driving up the value of a private company.
In response, Schwartz dismissed the idea that businesses would avoid profitable solutions simply because another entity benefits. He framed it as unrealistic for institutions to reject a system that makes economic sense just to avoid enriching Ripple.
"Yeah, this makes business sense for us to do and would make us money, but we don't want to do it because it also makes this other company money."
— David 'JoelKatz' Schwartz (@JoelKatz) April 2, 2026
Ultimately, Schwartz’s argument suggests that stablecoins and cryptocurrencies are not direct replacements but complementary tools. While stablecoins may dominate in low-volatility environments, XRP and similar assets still provide unique advantages in global liquidity, neutrality, and long-term value potential.
