XCP

XCP is the native token of the Counterparty platform, a protocol that extends the Bitcoin blockchain to support token issuance, decentralized exchange, and programmable smart-contract-like features. Launched in the mid-2010s, Counterparty enables users to create and trade digital assets and to embed complex transaction data within Bitcoin transactions, effectively adding a layer of programmability on top of Bitcoin.

In the Counterparty system, XCP serves as a utility and fee token. It is used to pay for certain network operations, including fees related to issuing new assets on the platform and executing specific kinds of transactions or contracts. The total supply of XCP was fixed at launch, and new XCP are not minted through mining or staking; the token operates as a finite resource within the Counterparty ecosystem.

Technically, Counterparty uses the Bitcoin blockchain as its underlying ledger, encoding asset and contract data in Bitcoin transactions. XCP tokens are transferred and managed within this Counterparty layer, rather than on a separate standalone blockchain. This design ties Counterparty’s security and settlement to Bitcoin while enabling asset creation and decentralized exchange features on top of it.

Market presence and status have varied over time, with XCP trading on cryptocurrency exchanges and behaving as an early example of on-chain asset issuance on Bitcoin. While not as prominent as some later platforms, Counterparty and its XCP token are often cited in discussions of early decentralized finance concepts built atop Bitcoin. See also Counterparty, Bitcoin, asset tokenization, decentralized exchange.