The debate over XRP’s true circulating supply and original purpose has reignited, thanks to a bold statement from crypto author and Anodos Finance co-founder Panos Mekras. In a widely shared thread, Mekras challenged long-standing assumptions about how XRP supply is reported—particularly by major market data platforms like CoinMarketCap—and clarified misconceptions about the digital asset’s foundational design.
At the heart of his argument: all 100 billion XRP were put into circulation at the network’s inception in 2012, with no inflation since. This claim, if accepted, could reshape how investors and analysts assess XRP’s scarcity, distribution, and long-term value proposition.
The Real Story Behind XRP’s Circulating Supply
Mekras emphasized that the XRP Ledger (XRPL) operates fundamentally differently from proof-of-work blockchains like Bitcoin. There was no mining process to gradually release tokens. Instead, the entire supply of XRP was pre-minted and made available when the ledger went live in June 2012.
“All XRP that will ever exist has been in circulation since day one,” Mekras stated. “There is no inflation. The supply is fixed and finite.”
To facilitate early adoption, the three core developers—David Schwartz, Arthur Britto, and Jed McCaleb—initially distributed XRP through a Genesis wallet, allowing users to claim tokens freely via faucets and airdrops. These programs aimed to decentralize ownership and encourage network participation.
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However, this open distribution model eventually led to market instability. As large volumes of free XRP entered circulation, price volatility increased. By 2017, Ripple (then OpenCoin) responded by locking 55 billion of its remaining XRP holdings into escrow accounts, releasing only 1 billion per month under strict conditions.
Why CoinMarketCap’s Supply Metrics May Be Misleading
One of Mekras’ most pointed critiques targets CoinMarketCap’s methodology for calculating circulating supply. Currently, CMC excludes Ripple’s escrowed XRP from “circulating” totals—treating it as locked or inactive—while still counting XRP held in escrow by other entities on the XRPL.
This creates an inconsistency: if escrowed tokens are deemed non-circulating due to liquidity constraints, then all escrowed XRP should be excluded—not just Ripple’s.
“If we’re going to use escrow status as a filter,” Mekras argued, “it must apply uniformly across the ecosystem. Otherwise, we’re distorting the real picture of availability and control.”
This selective accounting may understate XRP’s actual liquidity and create a false impression of future sell pressure from Ripple alone—fueling bearish sentiment despite evidence that most escrow releases are either held or used for operational purposes.
How Was XRP Originally Distributed?
The early distribution strategy played a crucial role in shaping today’s ownership landscape. Between 2012 and 2017:
- Free claim programs allowed anyone with internet access to obtain XRP.
- Airdrops targeted early crypto adopters and developers.
- Faucets dispensed thousands of XRP daily to promote usage.
While generous, these efforts attracted speculative behavior and contributed to uneven distribution. Some individuals accumulated massive amounts at near-zero cost, later becoming influential voices—or critics—within the community.
Ripple’s decision to implement escrow was not just about price stability; it was also a strategic move to build trust with regulators and institutional partners by demonstrating responsible stewardship of its holdings.
Investor Frustration Mounts Over XRP’s Utility Narrative
Mekras’ intervention comes amid growing skepticism among retail investors. Many feel misled by shifting narratives around XRP’s purpose.
For years, the dominant story has been that XRP is designed for banks and cross-border payments through Ripple’s On-Demand Liquidity (ODL) system. But Mekras insists this interpretation is flawed—and even harmful.
“XRP was never meant for banks,” he declared. “It was created to disintermediate financial institutions—not serve them.”
According to Mekras, the idea that XRP is a banking tool originated with Bitcoin maximalists who sought to discredit it as a “centralized corporate coin.” That label stuck, later amplified by influencers promoting short-term price gains over technological truth.
Today, some investors question whether real-world adoption matches the hype. Despite Ripple’s partnerships with payment providers and financial firms, widespread use of XRP for settlements remains limited—and often shrouded in NDAs.
One investor asked: Will XRP ever reach $10? The answer depends on clarity. Without a unified understanding of supply dynamics and utility, price momentum may continue to stall.
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Addressing Common Misconceptions About XRP
FAQ: Frequently Asked Questions
Q: Was new XRP created after 2012?
A: No. The total supply of 100 billion XRP was pre-minted and launched with the XRPL in 2012. No additional tokens have been or can be created.
Q: Does Ripple control the XRP Ledger?
A: No. While Ripple was instrumental in developing the XRPL, the network is decentralized and maintained by an independent validator set.
Q: Are escrowed tokens part of circulating supply?
A: This depends on definition. Technically, escrowed XRP is still on-chain and transferable under certain conditions. Excluding only Ripple’s escrow while including others introduces bias.
Q: Is XRP inflationary?
A: Absolutely not. Unlike systems with block rewards, XRPL has zero inflation. Transaction fees are destroyed (burned), slightly reducing net supply over time.
Q: Who benefits from the current narrative around XRP?
A: Short-term speculators and influencers may profit from fear-based stories about Ripple dumping tokens. Accurate reporting benefits long-term holders and ecosystem health.
Q: Can individuals place XRP in escrow too?
A: Yes. Escrow functionality is built into the XRPL protocol and available to any user—not just Ripple.
A Call for Transparent Data Standards
Mekras’ critique extends beyond one platform. He calls for industry-wide reform in how blockchain metrics are defined and displayed.
“Data accuracy matters,” he said. “When major sites like CoinMarketCap misrepresent supply, they mislead millions of investors.”
Standardizing definitions—such as what constitutes “circulating supply”—would improve transparency and reduce manipulation through misinformation.
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As the digital asset space matures, reliable metrics will become increasingly vital for institutional adoption and regulatory clarity.
Final Thoughts: Reclaiming XRP’s True Identity
Panos Mekras isn’t just correcting a data point—he’s challenging a narrative that has shaped perception for over a decade. By clarifying that XRP has been fully in circulation since 2012, he reframes discussions around scarcity, fairness, and decentralization.
Whether or not you agree with his views on banks or utility, one thing is clear: accurate information empowers better decisions.
For investors navigating uncertainty, understanding the facts behind supply, distribution, and protocol design isn’t just helpful—it’s essential.
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