The initial distribution of cryptocurrencies like XRP has always been a hot topic for investors in the crypto community. Often the discussions stem from investors believing there was foul play at Genesis, where some people received an unfair share of the token supply.
The latest coin to come under scrutiny is the XRP token, with community members asking questions about some of the events that took place in Genesis. As a result, Ripple CTO David Schwartz has taken it upon himself to clarify these issues.
What happened to the Genesis block?
David Schwartz first came under criticism from the Bitcoin community with a tweet earlier this week where he mocked the opinions of a Bitcoin maxi he had supposedly had a conversation with. This conversation, in which the Bitcoin maxi had seemingly called XRP worthless, and Schwartz mocked the opinion as worthless, would quickly devolve into a debate about the legitimacy of XRP in no time.
Responding to Scwartz’s post, X user @MetaMan_X asked the Ripple CTO if there was any other blockchain that had lost its entire genesis block. For those who don’t know, the XRP Ledger starts at #32,569 instead of #1 as you would expect from a blockchain. This has always been a point of contention
However, Ripple’s CTO defended the XRP Ledger, saying, “The choice of what to consider the genesis block is arbitrary.” He further compared the blockchain to that of the Ethereum blockchain, saying that the world’s second-largest cryptocurrency also had similar problems in the beginning.
He points to a single transaction worth over $6 million worth of ETH, which apparently has no original point whatsoever. Schwartz explains that even Ethereum had transactions that weren’t on the blockchain, and he would know because this huge transaction was executed by himself.
Token price struggles to keep up | Source: XRPUSD on Tradingview.com
How was the XRP offering distributed at Genesis?
Schwartz went on to defend the XRP Ledger against those who asked him to provide trades included in the genesis block. According to him, there were actually no transactions included in the Genesis block. Furthermore, of the 32,570 ledgers currently missing from the blockchain, the Ripple CTO revealed that there were only 534 transactions in those blocks. So now it is assumed that all these transactions were lost with those initial blocks.
One more piece information that the Ripple CTO offers is how the total XRP supply was initially distributed initially. Apparently the founders had received 20% of the total supply in the beginning, while Jed McCaleb and Chris Larsen each received 9% of the total supply. Subsequently, a third founder, Arthur Britto, received 2%, completing the 20% allocation to the founders.
The vast majority of the supply would go to the OpenCoin company (now known as Ripple), with 99.99% sent to the company’s wallet. The remaining 0.013% would ultimately go to beta testers and developers on the blockchain.
This revelation provides insight into how XRP distribution was handled and why Ripple controls such a large portion of the supply. Currently, the company releases one billion coins from escrow every month, with 200 million tokens held for operating costs and 800 million returned to escrow.
Featured image from YouTube, chart from Tradingview.com
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