Ripple Labs, the San Francisco-based fintech company, has begun the monthly distribution of unlocked XRP tokens from its escrow.
This development comes amidst Ripple’s ongoing legal dispute with the US Securities and Exchange Commission (SEC). In this article, we delve into the details of this token unlock process and shed light on the background of XRP’s initial distribution.
XRP’s Unique Characteristics: XRP is a digital asset that operates on an open-source platform, and it stands out due to its pre-mined nature.
With a maximum token supply of 100 billion, the initial distribution of these tokens was divided among Ripple, the co-founders, and the core team of the XRP ledger (XRPL).
Ripple’s Allocation: Out of the 100 billion XRP tokens, Ripple received 80 billion, while the remaining 20 billion were allocated to the company’s co-founders and the core team. However, to maintain a controlled and stable token supply, Ripple chose to lock 55 billion tokens out of its allocated share.
Unlocking Process: The recent token unlockings involved three separate transactions from Ripple’s escrow. These unlocked tokens are part of the pool of 55 billion XRP that Ripple periodically unlocks for distribution. The unlocking process allows for a regulated release of XRP into the market.
Legal Battle with the SEC: Ripple Labs has been at the center of a legal dispute with the SEC over allegations of selling XRP as an unregulated security. The outcome of this legal battle will have significant implications for Ripple and the broader cryptocurrency industry.