The mechanics behind XRP’s supply have always been public. A breakdown on X from crypto commentator Crypto Tony looks at the process of XRP unlocks in particular, with the theory that the payments technology company is, in fact, diluting every holder of XRP.
The Escrow Machine and How It WorksTo understand the controversy, it starts with how XRP was created and distributed. When XRP launched in 2012, all 100 billion tokens were minted at once. Ripple’s founders took 20 billion for themselves and handed the remaining 80 billion to the company. For the first five years, nothing legally prevented Ripple from selling as much of that supply as it wanted.
Based on that framework, Ripple releases one billion XRP each month but relocks between 60% and 80% of the tokens, and they keep the rest, which is roughly 200 to 300 million XRP. According to Crypto Tony, the remainder is kept by Ripple and used to fund the entire company.
Ripple Is Diluting XRP HoldersA major part of the analyst’s discussion is how Ripple has been diluting the value of traders holding XRP, citing major examples as to how this is happening.
The SEC addressed this arrangement in its complaint against Ripple, writing that MoneyGram had become a conduit for Ripple’s unregistered XRP sales.
