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Ripple Burn Rate Questions and My Calculations


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Ripple Burn For every transaction on the ripple network the ledger deducts 10 drops as terms of ripple it is 0.00001 of a ripple. At this calculation that is for every 100,000 transactions 1 Ripple is burned. As in this article https://ripple.com/build/transaction-cost/ it will be increased and decreased depending on usage and amount left. How many transactions to get rid of a billion? 100 trillion transactions. It seems like a large number but https://www.xrpchat.com/topic/5171-xrp-are-already-starting-to-burn-per-second-and-fast/, its starting to go down already, but this has to do with needing to fun each wallet with 20 xp. By doing some googling I could come up with about 150mill a day as visa currently see’s if anyone knows of any number higher just do the below but that seems reasonable.

Math stuff 100 trill (to burn 1 billion rip) / 150 million day =666,666 thousand days = 1826.5 years

https://ripple.com/build/transaction-cost/ Covers a lot of great info on the subject but maximum cost from what I see is 350 drops or Higher than usual. Well My question is what is higher than usual? is that from today or from in a year. Regardless I feel the transaction needs to be higher let’s say for example we wanted at least 2 billion a year to be burned in transactions. Will take visa and add some because we hope to be over visa lets say 300 mill a day that’s double what visa sees.

300 mill x 365 days in a year = 109,500,000,000 or 109 billion a year

109 billion divided by the 2 billion we want in a year = xrp 54.75

So at 54.75 current cost 0.20 that’s about $10.95 per transactions. That’s A lot so that can’t count because we don’t want to charging people an arm and a leg for transactions.

The burn is what me as investors want but it has to be not costly and has to be reasonable at 2 billion a year it would take 50 years to run out of Ripple completely. As far as I am concerned that would be a reasonable number since it is planed obsolescence. Swift has been around for 44 years and it is about to be replaced.

So we have some problems here on one had its too long to burn the other it’s too costly to burn. There has to be a happy medium. I think Scaling would be appropriate which Higher than usual activity calculated into Cost of Transaction. Because if ripple hits lets say $10 dollars burning 1 xrp would still be costly and banks would want to hold onto it turning them away from using it. But if lets say the network see’s 300 million a day and the cost is $10 dollars then .25 Cents is still low for a transaction that’s 40 Times Cheaper. At 100 dollars, it’s still only $2.5 for a transaction cost. At $1000 that $25 but that’s unreasonable to assume it would get that high. But at the current calculations let’s assume we want to hit market cap and valuation of $1000 how long would this take.

So ripple is at $10 dollars and there is 300 million a day in transactions costing .25 cents per transaction costing 75,000,000 dollars a day in ripple being burned. Or 7 million burned a day x 365 days in a year 2.737 billion a year So even that’s to costly.

Ripple does have a Bank Cost Model https://ripple.com/cost-model/ which shows savings on average of 60% at 100 mill transactions and 10 billion transactions transaction cost at $3.91 dollars per transaction. with a side note of micro transactions equal greater savings.

I am just wondering if this is a scaling solution they have already implemented. I am also not sure if this is part of the Burn. It may be that transaction cost is returned to the Ripple company so they can continue to sell ripple or in fact its gets burned.

It could be that the cost goes up per transaction amount but the question is it in the burn or just return.

Anyone have more interesting burn rate info or calculation?

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Fair play to you for doing those calculations, but you need to remember that the main function of burning xrp is to prevent spamming the network, not to create deflation. Ripple can and probably will reduce the burn rate, exactly the same way  they can and will reduce the minimum amount of xrp each wallet must hold. 

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quote from on of Ripple founders Arthur Britto at bitcointalk:



Transaction fees are currently 10 drops (1,000,000 drops = 1 XRP). The transaction fee can be adjusted so 1 drop = lots of transactions if needed.

The loss due to transaction fees is insignificant. The world need not worry about running out of XRP, because, XRP is divisible to 6 digits which can be increased to more digits.


transaction fee is only anti-spam mechanism, not intended to deflate total amount of xrp.

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Couple of years back we had a fixed 5xrp fee per transaction. Now we have dynamically adjusted fee that responds to the load of the network. 

If the need ever arises, the fees will be adjusted accordingly. This isn't a thing to worry about. 

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  • 3 years later...

This math doesn't make sense.  There are 1 million drops per XRP.  So, 10 drops per transaction is 100,000 transactions.  Even if XRP was $10,000 per coin, it would only cost 10 cent per transaction.  

$10,000/100,000 = $.10 per transaction.  So where are you guys getting $10.95 per transaction?  XRP would have to cost over $1,000,000 per coin to get that cost per transaction.  If I'm missing something please educate me. 

Edited by sugaman
correcting typos
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  • 2 weeks later...
On 12/27/2020 at 4:52 AM, JustKevStockholm said:

This is a old thread. But anyhow:

Ripple doesn't "control" it:

  • Validators will decide the burn rate through a voting process;
  • Same with the min amount XRP wallets must hold

In Sept '17 Ripple ran the validators.

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