Charles Hoskinson Explains Why XRP Holders Gain Nothing When Ripple Succeeds
In a recent discussion that caught the attention of the cryptocurrency community, Charles Hoskinson, co-founder of Cardano and a prominent figure in the crypto space, addressed a common misconception about Ripple’s XRP token. The question posed to Hoskinson was straightforward: even if Ripple as a company retains all its business value, don’t XRP holders benefit when media headlines boost the token price during a bull market? Hoskinson’s response was clear, emphasizing the fundamental economic and legal disconnect between Ripple’s corporate assets and XRP holders.
XRP Holders Are Not Owners of Ripple’s Assets
Hoskinson explained that Ripple Labs, the private company behind the XRP token, owns approximately 70 to 80% of the total XRP supply. According to him, Ripple’s strategy involves creating hype around the token and selling XRP to investors during bullish market trends. The money raised from these sales flows into Ripple as a company and is used to expand the business by acquiring assets, building platforms, and developing financial infrastructure.
However, crucially, XRP holders do not have legal ownership over any of these assets or company ventures. Hoskinson emphasized, “XRP holders have no legal ownership of those assets. They go to a centralized company. The XRP token doesn’t really have much to say or do with that. There are no staking rewards or other things connected to it.” In other words, owning XRP is not equivalent to owning a stake in Ripple Labs or its profits.
A Comparison to Tether
Hoskinson drew parallels between XRP and Tether (USDT), highlighting that in both cases, the centralized entities benefit directly from token sales, while holders simply possess tokens that do not entitle them to any underlying value appreciation linked to the company’s success.
“It’s basically like Tether from that perspective. One company gets all the value and the holders get some instrument and some network, but they don’t actually get any price appreciation from that,” he stated.
The Circular Economy Challenge
Highlighting the importance of effective tokenomics, Hoskinson contrasted Ripple’s model with projects designed to create a circular economy where network activity directly drives demand for the token itself. He cited projects such as Midnight and Hyperliquid as examples where increased usage results in higher buy demand for their tokens, ultimately benefiting holders.
“There is nothing in the Ripple network that creates buy demand for the XRP token. Nothing,” Hoskinson said. “Whereas you can do that with Hyperliquid and absolutely can do it in the app chain model.”
He also referenced EOS as a historical example. Block One, the company behind EOS, raised $4 billion to build the network but retained the capital and had no fiduciary responsibility to EOS token holders, who ended up with tokens that did not appreciate in tandem with the company’s wealth.
Ripple’s Ongoing XRP Sales and Market Impact
While acknowledging that XRP’s price can benefit during bull markets due to positive headlines, Hoskinson emphasized that Ripple continuously sells hundreds of millions to billions of dollars’ worth of XRP annually, according to SEC filings that formed part of the ongoing legal proceedings.
“This selling is ongoing. The cash goes into Ripple the company, not back into XRP,” he pointed out. Moreover, Ripple does not perform buyback programs to support XRP’s price, as is sometimes done by other companies with equity tokens. “When they do make revenue and profit, there is no buyback. The Ripple company is not going and buying back XRP. They sell the XRP,” Hoskinson said.
Conclusion
Charles Hoskinson’s perspective provides insight into the structural dynamics between Ripple as a private company and XRP holders. While market sentiment and headlines may temporarily boost XRP’s price, holders do not receive dividends, ownership, or direct economic benefits from Ripple’s business successes. This clarification is critical for investors to understand the distinction between owning a utility or investment token versus owning a company’s equity.
This article is based on comments and analysis provided by Charles Hoskinson and does not constitute financial advice. Readers are encouraged to conduct their own research before making investment decisions.
Tags: Cryptocurrency News, Ripple (XRP), Charles Hoskinson, Tokenomics
Author: Anjali Belgaumkar
Writer focusing on financial news, cryptocurrency analysis, and blockchain trends.
Date: April 19, 2026