Counterparty

Purpose and Utility

Counterparty (XCP) is a protocol built on top of the Bitcoin blockchain that enables the creation and trading of digital assets. Created in 2014, it allows users to create tokens, digital collectibles, and execute smart contracts using Bitcoin's security.

Business Model and Current Usage

The platform's primary utilities include: Creating and managing digital assets, Trading tokens peer-to-peer, Non-fungible token (NFT) creation and trading, Decentralized exchange functionality.

The protocol generates no interest or riba-based revenue. Instead, it facilitates direct peer-to-peer exchange of digital assets with clear ownership rights.

Development and Adoption

While development activity has slowed in recent years, the protocol continues to function as designed. The project maintains an open-source codebase and has a small but active community of users primarily focused on digital asset creation and trading.

Token Distribution

XCP tokens were initially distributed through a 'proof-of-burn' mechanism where users voluntarily destroyed Bitcoin to receive XCP tokens. This created a fair launch with no pre-mine or founder allocation. The total supply is fixed at approximately 2.6 million XCP.

Revenue Model

The protocol itself generates no revenue. Transaction fees are paid in Bitcoin to Bitcoin miners. XCP tokens are used for creating assets and executing smart contracts on the platform.