XRP, launched in 2012, is the native currency that runs on the XRP Ledger (XRPL), a public, open-sourced, permissionless, and decentralized blockchain that anybody can contribute to or transact on.

XRP is used on the XRPL, which is a payment settlement, asset exchange, and remittance network for global payments used by private financial businesses and entities,  operating similarly to the SWIFT banking network, which is used for international payments and transfers by banks and financial institutions.

Jed McCaleb, David Schwartz, and Arthur Britto founded XRP,  originally designing it with a simple idea – to send payments between two parties.

Jed McCaleb, David Schwartz, and Arthur Britto would later team up with Chris Larsen, who was working on a payment protocol at the time called Ripple through his own company called OpenCoin.

The four joined forces in 2013, changing Opencoin’s company name to Ripple Labs.

As the founders of the cryptocurrency, blockchain, and company, the 4 founders designed XRp to launch with a pre-mined model of tokenomics.

The XRPL was created with 100 billion tokens already in existence, with the majority going to Ripple, and the rest going to the founders.

This model sets XRP apart from other cryptocurrencies, as new tokens aren’t mined like they are with bitcoin (BTC).

The founders donated 80% (80 billion tokens) of the pre-mined XRP tokens to the company while keeping the remaining 20% (20 billion tokens) for themselves.

The donation to Ripple Labs was done in an effort to support the predictability of XRP supply and support the community by selling XRP at opportune times to increase market liquidity and overall XRP market health.

This distribution model created debate within the cryptocurrency industry as many market participants had an issue with a Ripple potentially being able to dilute XRP’s value by releasing XRP to the market all at once.

To combat this uncertainty, starting in 2017, Ripple set out an escrow plan, which locked 55 million XRP on the XRPL in a series of escrows that would release 1 billion XRP each month to Ripple.  Ripple would release some of that 1 million to the market, and the rest would return to the escrow for a release in the following month.

The hope was that this plan would offer some transparency on the part of Ripple to XRP holders and new buyers potentially worried about XRP’s price being diluted.

Ripple Labs is a private company that has a direct hand in the development of the XRPL blockchain, while also controlling the majority of the XRP’s supply.

The XRP Ledger is run by a global network of 150+ validators, who agree on transactions every 3-5 seconds.

While XRP and Ripple are often used interchangeably, they do mean different things.

XRP describes the actual native cryptocurrency, whereas Ripple, or rather Ripple Labs, describes the company behind XRP.

Of the 100 billion XRP tokens, a little more than 45 billion tokens, or close to 50% of the max supply, are in circulation as of  August 2022.

XRP is traded on 100 markets and exchanges worldwide.  However, due to an existing lawsuit by the SEC, many U.S.-based cryptocurrency exchanges and financial services providers have suspended buying and selling of XRP until further notice.