Token Description & Project Background

XRP is the native token fuelling the XRP ledger (XRPL). 

Whilst XRP token is an open-source digital asset, it is also Ripple’s (the technology company) native asset. Ripple is trying to build a global settlement network that provides a cheaper, faster, and friction-free payments system than its traditional non-blockchain counterparts.

Ripple describes its payment network, RippleNET, as "a decentralized global network of banks and payment providers using Ripple's distributed financial technology, which provides real-time messaging, clearing, and settlement of financial transactions."

The Ripple network uses a unique consensus mechanism to validate transactions.

Ripple was founded in 2012 as ‘NewCoin’. The company was later rebranded to Ripple by Chris Larsen and Jed McCaleb in 2015.

McCaleb, David Schwartz ( CTO at Ripple as of June 2023), and Arthur Britto developed and launched the XRP ledger in 2012. The XRP token was created alongside the XRP Ledger to help facilitate cross-border payments.

As of June 2023, Brad Garlinghouse is Ripple’s CEO. Garlinghouse was previously Senior Vice President at Yahoo! and President of Consumer Applications at AOL. Chris Larsen serves as Executive Chairman. Prior to his involvement with Ripple, Larsen co-founded online mortgage lender ‘e-Loan’ in 1996 and Prosper, a peer-to-peer lender, in 2005.

Risks of XRP

Like an investment in other crypto assets, there are some general risks to investing in XRP. These include:  (i) volatility risk and liquidity risk, (ii) short history risk, (iii) demand risk, (iv) forking risk, (v) code defects, (vi) regulatory risk, (vii) electronic trading risk, and (viii) cyber security risk. For additional information of these and other general risks associated with crypto assets and Uphold’s platform, please refer to the Risks Specific to Holding Digital Assets statement.

In addition to these general risks, an investment in XRP is subject to the following specific risks:

• The Layer-1 space faces intense competition. Any potential success associated with XRP depends on the XRP-Ledger and XRP’s rate of adoption by enterprise clients and users worldwide.
• The U.S. Financial Crimes Enforcement Network (FinCEN) charged Ripple Labs and XRP for violating the Bank Secrecy Act in May 2015

We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with XRP. Investors should conduct their own research and perform their own assessment before trading any crypto asset to determine the appropriate level of risk for their personal circumstances.

The XRP community and Ripple are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of XRP have no recourse to the XRP community, Ripple, or Uphold if XRP declines in value for any reason.

Changes to applicable law may adversely affect the use, transfer, exchange, or value of any of your crypto assets, and such changes may be sudden and without notice.

Uphold’s Evaluation Process

Prior to listing XRP on the Uphold Platform, Uphold performed due diligence on XRP and determined that XRP is unlikely to be a security or derivative under relevant securities legislation. Uphold’s analysis including reviewing publicly available information on the following: 

• The creation, governance, usage, and design of XRP, including ensuring the source code is open-source, audited and peer reviewed, security, and roadmap for growth in the developer community. 
• The supply, demand, maturity, utility, and liquidity of XRP.
• Any marketing materials put forward by the XRP social team including on, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
• Material technical risks associated with XRP, including any code defects, security breaches and other threats concerning XRP and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them.
• Legal and regulatory risks associated with XRP, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of XRP. 

General

Uphold has prepared this Crypto Asset Statement based on publicly available information. Although Uphold has taken steps to obtain information from apparently reliable sources, information contained in this Crypto Asset Statement may be inaccurate, incomplete or out-of-date. This overview is a starting point for you to perform your own research prior to investing in a crypto asset.

Uphold users should read the Risks Specific To Holding Digital Assets statement for additional discussion of general risks associated with crypto assets made available through the Uphold platform.  

Canadian residents, please note that Uphold has filed an application for registration in certain Canadian jurisdictions but has not yet obtained registration. Until such time as Uphold obtains registration, Uphold has agreed to abide by the terms of an undertaking available at the following link. Please also review the Uphold Canada – Crypto Risk Statement for additional discussion of general risks associated with the crypto assets made available through Uphold Platform. Please be aware that statutory rights of action for damages or rescission in section 130.1 of the Securities Act (Ontario) and, if applicable, similar statutory rights under securities legislation in the other provinces and territories of Canada do not apply in respect of this Crypto Asset Statement or other disclosures on the Uphold website and Risks Specific To Holding Digital Assets statement. 

Last updated on June 21, 2023.