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Koen van Schaijk
Koen van Schaijk

What is The Unique Node List?

This article discusses the Unique Node List (UNL) and why it is so important to the XRP Ledger. 

The UNL is a the list of validators a given participant believes will not conspire to defraud them. Each server operator can choose their own UNL with which they want to cooperate, usually based on a default set provided by a trusted publisher. 

Since anyone can run a validator node, the burden is on the participants of the network (XRPL) to choose a reliable set. Right now, three publishers (Ripple, Coil, and the XRP Ledger foundation) are known to publish recommended lists of high quality validators, based on past performance, proven identities, and responsibility towards the system. However, every network participant can choose which validators it chooses as reliable, the list provided by the three publishers are mere recommendations towards the server operators.

If Ripple Recommends the Adoption of Its UNL, doesn’t that create a centralized system?

No. The XRP Ledger network operates on an opt-in basis. Each participant directly or indirectly chooses the UNL it wants to cooperate with. If Ripple or any of the other publishers stop operating or act maliciously, participants can change their UNLs to use a list from a different publisher.

Incentives

The primary incentive to run a validator is to protect and preserve the continuous stable operation and evolution of the XRP Ledger. It is the validators who decide upon the evolution of the network, so any business that uses or depends on the XRP Ledger has an inherent incentive to ensure its reliability and stability of it. Validators also earn the goodwill and respect from the community by contributing in this way to the ecosystem.

If you run an XRP Ledger server to participate in the network, the additional cost and effort to run a validator is minimal. This means that additional incentives, such as the mining rewards with Bitcoin, are not necessary. The structure of the UNL has been set up in such a way that for operating a validator, no XRP is received. This is done because the behavior of validators could change if this was the case.

For examples of how incentives can warp validation behavior, read more about miner extractable value (MEV) here.

Koen van Schaijk
Koen van Schaijk