Flare Networks has detailed its plan to airdrop Spark (FLR) tokens to XRP holders after months of planning the airdrop. Once the network goes live, each eligible holder will immediately receive 15% of their claimable FLR tokens, while being able to claim an average of 3% per month thereafter.
According to Flare, the airdrop will carry on for a minimum of 25 months and a maximum of 34 months to eligible XRP holders. The slow rollout is reportedly meant to avoid users from selling their FLR tokens on the market as soon as they receive them so the price doesn’t plummet right away.
In a blog post, the firm wrote:
It has always been our stated position that the best people to provide capital to underpin the trustless issuance of FXRP on Flare are the people who own XRP. The only way to achieve this fairly is, in our opinion, the distribution of Spark that is taking place.
Flare Networks added that some users will not be embracing Flare and the Spark tokens for the utility they bring to the market, but will instead “wish to claim Spark only because they believe that it is ‘free money.’” The slow rollout is meant to “reduce the negative effects from this dynamic” by limiting the amount of liquidity that can be put into the market right away.
The Flare Foundation is a non-profit organization, and has written in its constitution it must be wound down and all of its Spark tokens burned if token holders agree its existence is no longer beneficial to the network.
Spark tokens are to be used for governance on the Flare network through voting mechanisms, and token holders will be able to earn a return on their holdings by committing Spark tokens as collateral to secure the trustless issuance and redemption of FXRP, a protocol built to “safely enable the trustless issuance, usage, and redemption, of XRP on Flare.”
As Daily Hodl reports, Flare has in the past said it would allow the community to vote on how the tokens should be airdropped, but ultimately decided against that move based on potential tax implications.
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