Cryptocurrencies gained popularity around the world and it is important to have a general understanding of cryptocurrencies. It is worth mentioning that, when it comes to Ripple it is both a platform as well as a currency.
Interestingly, the name of Ripple’s payment network is RippleNet, and the name of the cryptocurrency is Ripple XRP. Importantly, RippleNet connects banks and other big institutions. Moreover, it gives them the opportunity to transfer money and various other assets through the network. Notably, each transaction is recorded on a decentralized XRP ledger.
People should take into account that, the payment network uses the XRP currency for all transactions. It reduces time as well as money for cross-border payments. It is worth mentioning that, it only takes to process each transaction. For example, in the case of the Ethereum network, it takes more than 2 minutes, while for Bitcoin, it might take over an hour. This is not the end of the story as, in the case of traditional banks, it might take between 3-5 business days to complete an international transaction.
Interestingly, XRP can handle around 1,500 transactions per second. Bitcoin has the ability to handle around seven during one timespan. Moreover, it is not only about the speed, the Ripple network also offers low transaction fees. Thanks to the benefits mentioned above, numerous financial institutions around the world are already using it.
Ripple and interesting details
It is worth mentioning that, the core idea of the Ripple platform is to be an open-source protocol that will allow fast as well as cheap transactions.
Interestingly, it has offices in different parts of the world, San Francisco, New York, London, Sydney, and Mumbai, also it has more than 200 customers around the globe. As mentioned earlier, banks as well as payment providers have the ability to use the digital asset XRP to further reduce their costs and access new markets.
The history of Ripple dates back to 2012, following Rippleplay. It is a currency exchange, remittance network, and a real-time gross settlement system (RTGS).
People should keep in mind that, its network is not associated with terms like block or blockchain. Interestingly, they use the term common ledger, instead. As a reminder, it is managed by a network of servers that independently validate and compare transaction records.
Importantly, unlike Bitcoin which is using proof-of-work consensus, it does not rely on energy and intense computing power. Moreover, it does not use the blockchain data structure but it uses its own consensus protocol. Notably, its Ripple’s consensus process goes on a shared public database between those who validate servers, ensuring integrity. Furthermore, the validating servers can belong to anyone. For example, people, as well as financial institutions, have the opportunity to own validating servers.
Ripple is a payment network for financial institutions. Importantly, its main competitors are systems like SWIFT. Interestingly, in terms of the coin, Ripple signed contracts with companies, banks, and financial institutions to buy/sell the tokens. Moreover, people should take into consideration that, only regular people and investors/traders who would like to make a profit have the opportunity to increase its price on the market.
At the moment, due to XRP’s price, it does not make sense to compare it with the value of Bitcoin or Ethereum. As a reminder, it is not possible to mine this cryptocurrency. Nevertheless, it’s value significantly increased in the past year.
It is not as popular and valuable as Bitcoin or Ethereum, but it has the potential and many individuals and institutions realized this fact. Moreover, XRP is one of the most valuable cryptocurrencies in the world. Moreover, Ripple is currently working with more than 100 banks all over the world and this fact once more underlines its importance. Thus, it makes sense to invest in this cryptocurrency.