This white paper will show that the Spark distribution will not be a gratuitous transfer if the recipient (the donee) is not a partner or shareholder of the Flare Networks company nor have another relationship with a partner or shareholder, as is the case for almost every XRP owner receiving Spark tokens. The loophole occurs when a foreign entity or trust distributes the gift, thereby hiding the foreign source. Thus, the lawmakers call it a "purported" gift or a "gratuitous" transfer because the distribution is not what it appears.
#When will spark tokens be distributed pro#
person or entity as a gift when in fact, something was expected back as a quid pro quo or a self-dealing transaction. Reg 1.672(f)-4 addresses a tax loophole where foreign entities would transfer assets to a U.S. Would the Flare Networks Spark Token distribution to XRP holders be recharacterized as a "gratuitous transfer" from a foreign corporation under IRS Reg. Question Posed About Spark Token Distribution We look forward to working with the team and harnessing their expertise in MPC cold storage, DeFi and staking mechanisms.This white paper will show that the Spark Token distribution will not be a gratuitous transfer if the recipient (the donee) is not a partner or shareholder of the Flare Networks company, nor have another relationship with a partner or shareholder. We are confident that when Flare goes live, Copper will keep the Spark (FLR) token in their custodianship secure. Hugo Philion, CEO of Flare Networkss, said: “ Copper ’ s proven ability to assure the safety of all the tokens it looks after, coupled with their track record for launching their own innovative tech, made choosing Copper as an official custodian an easy choice. It also demonstrates our ability to quickly adapt and support the latest tokens on the market. Providing custody to the Spark token, which aims to scale up transaction value as well as volume through the power of smart contracts, is a perfect example of how Copper ’ s infrastructure can be used to facilitate the adoption of cryptocurrency at an institutional level. “ Underpinned by our industry-leading security, we recently launched a DeFi tool for institutions, called CopperConnect.
The Flare Networks team share Copper ’ s innovative spirit for developing solutions which will pave the way for cryptoassets to enter the mainstream. This partnership follows Copper’s November launch of the first decentralised finance (DeFi) tool for institutional investors, Copper Connect.ĭmitry Tokarev, CEO of, said: “ We are proud to be supporting the launch of the pioneering Flare Networks, by providing highly secure custody of its native Spark token. The amount of Spark receivable will directly correlate with the amount of XRP held as at the snapshot, based on a formula devised by Flare Networks.Ĭopper’s role as a custodian will support Flare’s vision for the emergence of alternative Proof of Stake, or staking, mechanisms – which, in their current form, can scale up transaction throughput but cannot scale for value.įlare will benefit from Copper’s vast experience providing institutional-grade multi-party computation (MPC) cold storage and the business processes required by asset managers to safely acquire and store more than 150 digital assets. The amount of Spark to which an XRP holder is entitled will depend upon the 12/12/20 snapshot. 45 billion of these 100 billion tokens will be claimable by existing XRP holders, excluding Ripple Labs. Its native asset, the Spark (FLR) token, will be distributed to XRP holders over a 36-month period, based upon a snapshot taken at 12:00am UTC on Saturday 12 December 2020.Īs custodian, Copper will be responsible for securely holding Spark (FLR) tokens on behalf of the Flare Networks and the Flare Foundation.Īt the instantiation of the network – which is scheduled for launch between Q1 and Q2 2021 – 100 billion Spark tokens will be created.
, the London-based digital asset infrastructure provider, today announced it will serve as an official custodian for Flare Networks.įlare is building the world’s first Turing-complete Federated Byzantine Agreement-based smart contract network.
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