10 Jan

Consequences for XRP? Ripple-backed cryptocurrency Flare announces Litecoin airdrop

The late surge of Ripple’s XRP in 2020 was partly due to a massive airdrop of Flare (FLR) tokens. Now, the smart contract solution is also offering support for Litecoin (LTC). An FLR airdrop for Litecoin users is in the works.
XRP wallets included in the December snapshot will receive Flare tokens (worth a lot of money, at least potentially).

Now Flare writes that they will „reduce“ the number of Flare tokens by 5 billion for the project’s founders. This extra will be distributed to „Litecoin participants“.

The tweet promises clarification in the coming week.

Flare for Airdrops
Tokens on the Flare network, known as Spark, will be used for governance and as collateral after the expected token drop in Q2 2021. The company plans to bring smart contracts to Ripple’s XRP.

So far, Ripple has been seen as a vehicle for money transfer – and Flare claims that the Spark tokens will add value.

With this tweet, the company is now announcing something that was rather unexpected: that the network will support other cryptocurrencies besides Ripple’s XRP, namely Litecoin.

Flare received a huge amount of press and hype in advance. However, the company Bitcoin Rush also calls its FLR tokens XFLR tokens (for XRP) on its website. There may also be LFLR tokens for Litecoin. And it may not end there.

Flare could add support for other currencies.

According to Flare, they want to support other networks in the future, but this has received little attention. Support for, say, the Bitcoin network could have big implications.

Smart contracts and Ethereum competition
The short version of Flare’s purpose is to enable smart contracts on protocols that don’t have them built in. Flare is supported by Ripple’s XRP, and the airdrop to most XRP-hodling wallets brings Flare into the spotlight.

There has been huge interest in Ethereum in recent weeks, and as it is the tried and tested secure smart contract chain, this is no surprise. The number 2 cryptocurrency could attract new investors who feel they have „missed the boat“ with Bitcoin, with many analysts seeing a rise to over $10,000 coming (Get in now? Go to Buy Ethereum with Paypal guide here).

But the technology behind Ethereum’s value is its smart contracts. Although there are many other similar protocols that are potential competitors (DOT, ADA, EOS), Ethereum is still on top.

However, if other networks (like XRP or LTC) could support smart contracts, it would increase their attractiveness. If these protocols could be interoperable across the Flare network, that would be a coup for Spark tokens (Flare has not indicated that they have plans to do so).

Back to the XRP bankers
Even if this new Litecoin airdrop leads to „free money“, not everyone is likely to be happy about Flare’s success.

For one thing, crypto’s bank haters see a connection between Ripple, which is behind Flare, and XRP, which is designed to deal with banks and governments.

For another, the US Securities and Exchange Commission’s lawsuit against Ripple and the possibility of delisting has put the token on shaky ground. Massive fines for Ripple and a ban from operating within the US could be coming (although this is not certain).

This fear could spill over to Flare.

With Ripple’s XRP rallying nearly 50% in the last week, it seems that the emotional market has quickly forgotten the despair over the trade stops on Ripple’s XRP.

And few things attract people’s attention as much as an airdrop.