Ripple’s recent revelation has shaken the XRP Army, who discovered it through a company document. Ripple plans to hold onto a massive chunk of XRP, aiming to retain 25% of the total XRP supply.
This decision means that Ripple will keep 25 billion XRP tokens valued at approximately $12.5 billion to support its operations and, ideally, generate profit.
Given that only 100 billion XRP tokens will ever be issued, this retention is a huge portion of the total supply. The document also points out that Ripple doesn’t charge for using its network because it’s not a financial services provider.
Instead, it makes money through its native currency, XRP. By keeping 25% of all XRP, Ripple plans to fund its operations and make a profit, aligning its goals with those of its users. As the demand for XRP grows, its value should increase, benefiting both Ripple and its users.
Ripple plans to distribute the remaining 75% of XRP by giving incentives to market makers, gateways, and consumers, hoping to increase the use and scalability of its protocol. The more participants there are in the ecosystem, the higher the demand for XRP, which could drive up its value.
A key part of Ripple’s strategy is using XRP as a bridge currency. The Ripple network is set up to make all balances easily convertible to XRP, which simplifies transactions. This means XRP can act as a universal intermediary currency, making it easy to exchange with any other currency on the network.
It added:
“If XRP is increasingly used as an intermediary currency, users who are unsure of what currency they will need may choose to hold XRP, since it readily translates into all other assets on the network. Market makers are one type of user for which this could be the case, but one can easily think of others as well.”
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