Through the use of blockchain and modern APIs, Ripple enables financial institutions who are part of the network, RippleNet, to send money globally, instantly, reliably and for fractions of a penny. RippleNet is built on top of Ripple’s consensus ledger, XRP Ledger (XRPL).

Ripple is the leading provider of crypto-enabled solutions for businesses. Ripple was founded by Chris Larsen and Jed McCaleb and launched in 2012 (previously OpenCoin).

XRP tokenholders own and govern Ripple's consensus ledger 'XRP Ledger' (XRPL). Ripple's investors include a16z, Pantera Capital, Route 66 Ventures, etc.

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XRP Ledger

# XRP Ledger Earnings Methodology

## 1. Overview

Earnings measures the net value XRP Ledger retains after subtracting all expenses from revenue. Earnings is calculated as revenue minus expenses, where revenue represents the protocol's share of transaction and trading fees, and expenses consist of token incentives. XRP Ledger generates revenue from two sources: base-layer transaction fees that are partially burned rather than distributed, and XRPL AMM trading fees that flow to liquidity providers.

## 2. Data sources

- **Revenue**: Derived from the Revenue metric
- **Expenses**: Derived from the Expenses metric

## 3. Step-by-step calculation

### Component A: Revenue calculation

- **Purpose**: Determine protocol-retained value from fees
- **Logic**: Revenue is calculated as total fees minus supply-side fees. For base-layer transactions, all fees are burned (100% protocol retention, zero supply-side allocation). For XRPL AMM trading fees, all fees flow to liquidity providers (zero protocol retention, 100% supply-side allocation). The resulting revenue represents the net value retained by the protocol.

### Component B: Expenses calculation

- **Purpose**: Account for token incentive costs
- **Logic**: Expenses consist solely of token incentives. XRP Ledger has no protocol-level token incentive mechanism—XRP was fully pre-mined at genesis with no validator rewards, staking, or inflation. Token incentives are hardcoded to zero.

### Component C: Earnings aggregation

- **Purpose**: Calculate final earnings
- **Logic**: Earnings are computed as revenue minus expenses. Since expenses are zero, earnings equal revenue. Values are aggregated daily with UTC day boundaries.

*This methodology was automatically generated by Token Terminal's methodology analyzer.*

Net profit (also profits, net income, profitability) — revenue remaining after subtracting expenses.

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