Flare Networks Scraps Plan to Modify Spark Token (FLR) Distribution 16

Flare Networks Scraps Plan to Modify Spark Token (FLR) Distribution

  • The team at Flare Networks had drafted 3 proposals to modify the distribution of Spark Tokens (FLR)
  • The proposals were meant to cater to XRP holders who live in jurisdictions that tax airdrops
  • However, the CEO of Flare Networks has scrapped all plans to modify Spark Token distribution
  • The original plan has been retained by the team at Flare Networks
  • Those who want can opt-out of the subsequent 3% monthly airdrop due to tax issues

Earlier this week, the team at Flare Networks published a blog post suggesting a community vote on altering the original distribution plan of Spark Tokens (FLR) to the XRP community that participated in the snapshot last year.

According to the blog post, the proposed changes were meant to assist XRP holders in jurisdictions that tax airdrops in addition to the regular capital gains tax incurred when selling digital assets. The new proposals that have since been scrapped, were meant to primarily benefit those living in the United States.

3 Proposals to Modify Spark Token Distribution That Have Since Been Scrapped

The first proposal was going to provide an option for recipients of the initial 15% drop of Spark Tokens, to burn a small amount of their FLR to purchase the remaining distribution. This move would circumvent the need to pay taxes on the subsequent airdrop distributions but would still incur capital gains tax upon sale of the tokens in the future.

The second proposal was to halt any distributions after the first one, thus destroying the remaining 85 Billion Spark Tokens (FLR) that would have been distributed over time

The third proposal was to retain the existing plan.

Flare Networks CEO Scarps All Proposals, Spark Token Distribution Will Not to Be Altered

In a tweet earlier today, the CEO of Flare Networks, Hugo Philion, announced that he had canceled the proposals altering the distribution of Spark Tokens (FLR). Furthermore, the distribution plan remains as is. He explained.

I made a mistake invoking governance over the distribution. I am cancelling the proposals. The distribution will remain 15% and then 3% per month. If tax creates sell pressure then a governance proposal can be submitted by the community to curtail the distribution.

Know Your Tax Obligations

Mr. Philion went on to remind the Flare Networks community that they could individually opt-out of the 3% monthly distributions. He also reminded the community, that knowing their respective tax obligations was recommended moving forward. He explained:

People who are concerned about tax will be able to opt out of the 3% monthly distributions. Make sure you are aware of your responsibilities to pay tax in each of your countries.