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- A document by Ripple employees revealed that the company intends to keep 25 billion XRP (or 25% of the total supply) to fund operations “and hopefully turn a profit.”
- The rest, or 75 billion XRP, will be distributed to the market to incentivize participants such as market makers, consumers and gateways to utilize the XRP Ledger and ecosystem dApps.
A document authored in November 2014, which the XRP community recently dug up, reveals that Ripple only ever intended to keep 25% of the total XRP supply and distribute the rest to market participants.
The document dived into what was then known as the Ripple Protocol, offering a breakdown for finance professionals, including how it works, its key features, potential use cases, settlement mechanisms and more. Patrick Griffin and Wellington Sculley authored it from Ripple’s Business Development department, Head of Markets Phillip Rapoport and Roman Leal, a former payments analyst from Goldman Sachs.
One of the key revelations from the report was the token allocation. It states:
Ripple Labs plans to retain 25% of all XRP issued to fund operations (and hopefully turn a profit) and distribute the rest to incent the participation of market makers, gateways, and consumers to utilize the protocol.
The report notes that the architecture of the Ripple Protocol dictates that only 100 billion XRP will ever be minted (the current circulating supply is 55.6 billion XRP). This predetermined supply is critical to ensuring the value of XRP rises, the report says.
The four authors also preemptively dismissed any criticism that Ripple has since then faced over whether it negatively affects the price of XRP. They stated:
Given that there is a finite number of XRP, as demand for XRP grows, the value of XRP should appreciate. In this manner, Ripple Labs believe that its incentives are aligned with those of protocol’s users – both want the protocol to reach its full potential and scale.
Ripple does not plan on selling all of its XRP.
They plan to retain 25% of their XRP to turn a profit and further fund its own operations.
The rest is distributed to incentivize the participation of market makers/gateways to UTILIZE THE PROTOCOL ✅
“As Demand grows PRICE ⬆️” https://t.co/Rc5dCkvrfA pic.twitter.com/ih0vHDfsWH
— SMQKE (@SMQKEDQG) June 20, 2024
Ripple and XRP to Underpin Global Commerce
The report also dived into the potential use cases of the Ripple Protocol and the XRP crypto. It notes that Ripple “is one of the few companies innovating at the very bottom of the payments stack, focused on providing a free, real-time settlement infrastructure for the world.”
It also discussed the advantages of using Ripple technology for various applications. For banks, it can enable them to optimize internal payment operations and “provide new and enhanced external payment services to customers.”
It can also allow payment processors to offer real-time settlement and allow regulators to easily monitor and enforce regulatory standards.
Meanwhile, XRP trades at $0.4857 and has traded sideways over the weekend. Its trading volume dipped 50% to $400 million.
