A recent document authored by Ripple employees has unveiled the company’s plan to retain 25 billion XRP, which accounts for 25% of the total supply, to fund operations and hopefully generate profits. The remaining 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.
This document, which was created in November 2014, provides insight into Ripple’s original intention to retain only 25% of the total XRP supply and distribute the rest to market participants. Authored by Patrick Griffin and Wellington Sculley from Ripple’s Business Development department, Head of Markets Phillip Rapoport, and former payments analyst from Goldman Sachs Roman Leal, the document delves into the Ripple Protocol, offering a comprehensive breakdown for finance professionals.
One of the key revelations from the report was the allocation of tokens, with Ripple Labs planning to retain 25% of all XRP issued to fund operations and distribute the rest to incentivize the participation of market makers, gateways, and consumers to utilize the protocol. The report emphasizes that only 100 billion XRP will ever be minted, and the predetermined supply is crucial to ensuring the value of XRP rises.
The authors also addressed the criticism faced by Ripple over whether it negatively affects the price of XRP, stating that with a finite number of XRP, the value should appreciate as demand grows. Ripple Labs believe that their incentives are aligned with those of the protocol’s users, both hoping for the protocol to reach its full potential and scale.
The report also outlines the potential use cases of the Ripple Protocol and XRP crypto, highlighting Ripple’s focus on providing a free, real-time settlement infrastructure for the world. It also discusses the advantages of using Ripple technology for various applications, including optimizing internal payment operations for banks and offering real-time settlement for payment processors.
As of now, XRP trades at $0.4857 and has traded sideways over the weekend, with its trading volume dipping 50% to $400 million.