- XRP Ledger may soon introduce a new fee management system after Ripple CTO David Schwartz proposed refund mechanisms to reduce overpayment.
- His two key ideas aim to enhance fairness by either rebating excess fees above the required amount or returning the difference from the median transaction fee.
Ripple CTO David Schwartz has unveiled a bold proposal aimed at reshaping how transaction fees are handled on the XRP Ledger (XRPL), sparking speculation about the network’s potential to rival Ethereum’s model. As Ethereum continues to dominate with its flexible gas system, XRPL may soon adopt features that allow fee refunds—something not currently possible on the network.
Two Bold Proposals to Eliminate Overpayment
Schwartz identified a key inefficiency: every user on the XRPL currently overpays for transactions. To resolve this, he introduced two possible solutions.First, he suggested dynamically calculating the minimum fee required after consensus. In this model, the system calculates the exact fee needed and refunds users any excess amount they pay.
The second proposal involves calculating the median fee of all transactions in a ledger version. Any payment above this average would also be refunded, offering a more equitable and efficient system. Although practical, Schwartz acknowledged that this could still result in users submitting overly high bids.
Hook vs EVM: A Battle of Fee Models
This proposed upgrade has sparked comparisons between XRPL’s Hooks system and Ethereum’s EVM (Ethereum Virtual Machine). While Ethereum users can overestimate gas and receive refunds, XRPL charges a static fee based on the worst-case compute scenario, with no option for a refund. XRP Ledger currently charges a standard transaction fee of just 0.00001 XRP and burns all collected fees, reducing the supply but offering users no refunds for overpayment.
XRPL Senior Engineer Mayukha Vadari and other validators like VET have echoed Schwartz’s concerns, advocating for a more flexible model. The wider discussion coincides with anticipation for the XRPL 2.5.0 upgrade and the recent integration of Circle’s USDC on the ledger.
XRP Price Reacts Positively
Following these announcements and broader development efforts, XRP has seen a 5% price increase in the past 24 hours, trading at around $2.28. The rebound highlights growing investor optimism as the XRPL evolves toward a more competitive and user-friendly framework.
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