Over the past 24 hours, a highly followed XRP community member has stirred confusion with a decade-old document from Ripple, the payments firm founded by the developers of the XRP Ledger.
In an X post on Sunday, February 23, “Xaif” claimed to have an important update for XRP holders, citing a document from Ripple.
“CRAZY UPDATE XRP,” the post started before adding, “Ripple announced that 25% of XRP will be Retained by them! This is great for Sustainability in the future.”
Xaif argued that this supposed Ripple move was bullish for XRP, asserting it was equivalent to burning 25% of the supply.
However, as several community members, including former Ripple Principal Developer Advocate Matt Hamilton, have highlighted, the document cited by Xaif is from 2014 and is no longer relevant.
Specifically, the excerpt is from a November 2014 document Ripple used to highlight its value proposition to finance professionals. However, it came long before XRP was eventually escrowed and no longer reflects the project’s tokenomics.
XRP’s Tokenomics
In reality, in 2017, Ripple decided to lock up 55% of the 100 billion XRP supply in escrow with the XRP Ledger programmatically designed to release 1 billion of these escrowed tokens monthly. A portion of the unlocked tokens is sold to partners, including exchange-traded products and trusts, and the remaining is locked up again in escrow.
Through this model, Ripple controls the amount of new XRP that can be brought into circulation. However, it has also attracted centralization arguments and criticism from the broader crypto community, with some asserting that the model is simply designed for Ripple to enrich itself at the expense of XRP holders.
The amount XRP held by Ripple in escrow has reduced to 38 billion coins, or about 38% of the supply as of December 31, 2024, per Ripple’s Q4 2024 market report. Meanwhile, XRP’s circulating supply sits at 57.88 billion coins.
