The upcoming XRP airdrop & its effect

• What are Spark (FLR) tokens?
• The correct way of receiving the airdrop with XRP
• What will FLR tokens be worth & how many will people receive?
• The effect on XRP’s price

Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results.

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What are Spark tokens?

Spark (FLR) is the native asset of the Flare Network. The latter is being built to solve two problems according to their team:

• Problem 1: 75% of the value existing in blockchains today cannot be used
• Problem 2: The potential issues with current scaling solutions as current protocols “derive network safety from their native token”

To solve this, the Flare team (funded by Xpring) led by their CEO Hugo Philion, have created a new scaling smart contracts platform that does not derive safety from its token but they still have a token to deter spam transactions; that token is Spark.

The first protocol to go live on Flare will be FXRP which will basically allow XRP to be transacted on Flare, similar to how wBTC lives on Ethereum. This network will only be important if it catches traction (i.e. gets users).

Let’s get back to the topic of our discussion.

Receiving the Airdrop

There are two routes one can take to receive their share of Spark tokens:

• Participating Exchanges
• Participating Wallets

The former is the less technical approach and probably the one most people would use due to its simplicity: hold XRP on a participating exchange before the wallet balances snapshot is due.

Participating Exchanges

There are multiple exchanges participating in this airdrop, including:

• FTX
• Kraken
• Coinbase
• Binance
• Bitstamp
• Crypto .com
• eToro
• KuCoin
• Liquid

More are going to be integrated into this list soon.

In the example of Binance, they put out a guidance as to how users can claim Spark tokens. The process is very simple:

The airdrop snapshot, including how many XRP each wallet had will be taken on December 12th 2020 at 00:00. Binance will also be disabling XRP deposits/withdrawals on December 11th which means anyone who wishes to participate this way must ensure their XRP is on there in time.

Participating Wallets

This method is riskier as the margin of human error is larger due to the technicalities of it. The basic premise if you’ll need to prove your ownership of an ETH address to get the Spark tokens airdropped to you based on your XRP balance on the XRP Legder.

These are the steps:

• Take an Ethereum address you own, or create one, this starts with “0x…” and then has 40 a-f character/0-9 numbers.
• Turn all small-cap letters into capital letters and remove the “0x” from the start
• Add “02” + 24 zeroes at the start of the string of numbers and letters
• The final result will look something like this: “02000000000000000000000000D2B4J2E09FDA0B6C2FE067EACA52C512FD3C6”
• This value should be stored in the message field on the XRP Leader using the AccountSet Transaction function

Double-checking that the message was stored correctly can be done by entering the public address here.

Wietse Wind created a tool for those who have Xumm wallet (with step by step instructions here) which is slightly easier to use.

Disclaimer: Not financial advice. USE AT YOUR OWN RISK!

The airdrop will not be immediate and will only start when Flare goes live next year.

How many Sparks will each user get & what will 1 Spark be worth?

The total number of Spark tokens will be 100 Billion to mirror the supply of XRP.

• 25 Billion FLR to Flare Networks Limited
• 30 Billion FLR to the Flare Foundation
• 45 Billion FLR in airdrops

In total there are 45 billion Spark tokens to be distributed for eligible users in this airdrop. The only non-eligible users are Ripple Inc, Jed McCaleb and any wallet linked to a known hack/fraud/theft. There will also be a “1B Whale Cap” meaning anyone owning more than 1B XRP cannot participate with more than 1B.

All in all, each person participating will receiving approximately 1 Spark per 1 XRP.

Distribution

When the network launches, each individual will receive 15% of the amount of tokens to be airdropped, the remaining 85% will be distributed over a minimum of 25 months and a maximum of 34 months.

What 1 Spark will be worth is not predictable but estimates put it at $0.01; meaning Flare Networks Limited would get $250,000,000 richer rather quickly.

Effect on XRP’s Price

This recent surge in XRP was associated by some to the upcoming Spark airdrop as anyone would love “free money”. But this is not necessarily true because the snapshot is still weeks away. As we get closer to December 12th, it is probable that the demand on XRP increases significantly.