Site Bitcoin.com writes a long article attacking Ripple, the author suggests that
“Ripple has been the talk of the town lately thanks to its rocketing value and growing market capitalization that’s making eyes at bitcoin. $1,000 of XRP bought a year ago would be worth half a million dollars today.
But away from the price action, there’s an issue bugging ripple that just won’t go away. It’s been alleged for years that Ripple Labs has the power to freeze the balances of account holders. If true, it would be a major cause for concern, especially for proponents of decentralized currency.”
But after the article that generated comments in Bitcoin and Ripple community,
David Schwartz, Chief Cryptographer at Ripple, replied to the Bitcoin’s report.
Wow, that is one of the most deliberately misleading articles I’ve ever seen. I am literally stunned at this level of dishonesty.
For example, “Upon learning of McCaleb’s actions, Ripple intervened and prevented him from doing so, utilizing its Balance Freeze feature.”
This appears carefully worded to suggest that Ripple actually used the freeze feature. But Ripple is not a gateway and only gateways can freeze.
And, again, “Built into Ripple gateways such as Bitstamp by default, it enables the company to stop the movement of XRP. “
This appears carefully worded to suggest that “the company” is Ripple. Of course, Bitstamp is a Ripple gateway and Ripple is not. Also, it does not enable anyone to stop the movement of XRP. Gateways don’t move XRP.
They also say, “Not only can the XRP be frozen, but so can the account balances associated with its sale, such as USD.” Except, again, XRP cannot be frozen. Only gateways can freeze and they can only freeze assets that they have issued. No gateways issued or issues XRP.
Also, the claim that we have some special relationship with gateways is more or less irrelevant since almost nobody uses Ripple gateways anyway. We pivoted away from the gateway strategy years ago. If you buy XRP from an exchange, hold it on the ledger, and then transfer it to an exchange, at no time do you use a gateway.
They say, “Nevertheless, a cryptocurrency which enables a centralized authority to freeze funds at the touch of a button defeats the entire purpose of cryptocurrency. “ We agree. That’s why we made sure there is no way to freeze XRP, the only cryptocurrency under discussion.
They also say, “If law enforcement suspected a cryptocurrency holder was engaged in criminal behavior, they could try to obtain a subpoena granting permission to seize that individual’s exchange balance – and would be required to submit evidence to show there was probable cause for doing so. But if that exchange happened to be a Ripple gateway, they could simply pick up the phone and ask for the Big Button of Freeze to be pressed. And that’s the difference between ripple and other cryptocurrencies.”
But, again, Ripple cannot freeze and nobody can freeze XRP. So what are they actually talking about here? Ripple cannot freeze anything. And exchanges can always freeze balances on the exchange. So what is the difference they’re talking about?
In summary, the article is deceptive and dishonest at a shocking level. It’s gateways that can freeze funds, not Ripple. The vast majority of XRP users don’t use Ripple gateways at all. So it doesn’t affect them. Nobody can freeze XRP.”
This is not the first time that news site like Bitcoin.com published fake news about Ripple, but the reason is clear: Ripple is a disruptive technology and fear is growing in Bitcoin community.