Charles Hoskinson Says Ripple Sells XRP to Fund Its Own Business While Creating No Buy Demand for XRP Holders

Charles Hoskinson criticizes Ripple for funding its business with XRP sales, claiming it fails to generate true demand for the token among holders.

In the evolving world of cryptocurrency, few voices resonate as strongly as that of Charles Hoskinson , co-founder of Ethereum and an outspoken advocate for transparency and regulation in the blockchain space. Recently, Hoskinson launched a scathing critique of Ripple and its native token, XRP , arguing that Ripple's business model does little to create genuine demand for the token while effectively using holders’ investments to fund its operations. Is Ripple’s Revenue Model Sustainable for XRP Holders? During an engaging discussion, Hoskinson highlighted a fundamental issue with Ripple's tokenomics: the absence of mechanisms that generate organic buy demand for XRP. He bluntly stated, “There is nothing in the Ripple network that creates buy demand for the XRP token. Nothing.” This assertion is rooted in a larger criticism of how Ripple operates. While many cryptocurrencies create circular economies that benefit token holders, Hoskinson described Ripple as more akin to a business that sells its tokens predominantly to fund its own operations. In fact, when Ripple generates revenue, it does not reinvest in XRP. Instead, it opts to sell XRP, turning these assets into cash that the company then uses to acquire other assets. How Does Ripple’s Model Compare to Others? To illustrate the contrast, Hoskinson pointed to Hyperliquid , a project where user activity creates fees that actively buy back the underlying token, resulting in value gains for token holders as the network grows. This stands in stark contrast to Ripple, where the value generated from business operations does not benefit XRP holders. “When they do make revenue and profit, there are no buybacks,” Hoskinson explained. He went on to emphasize that the value accrued from Ripple’s business ventures sits on the company's balance sheets rather than flowing to the holders of XRP. What About Regulatory Implications? Hoskinson didn't stop at tokenomics; he also critiqued Ripple's regulatory strategies. He argued th