The real-time gross settlement system known as Ripple is one of the biggest innovations in the cryptocurrency industry. Ever since the decentralization of the Bitcoin in 2009, the industry has seen an exponential growth and hundreds of networks and coins have been created and released. But very few are those that have offered something innovative into the scene.
Ripple and its native coin XRP (the coins are known as ripples as well) are one of the systems and coins that have brought the most value to the industry with their release. It is not surprising that currently Ripple’s is the 3rd largest crypto coin in the list of cryptocurrencies by market cap.
Ripple operates as a distributed open-source consensus ledger. It is also known as Ripple Protocol (RTXP – Ripple Transaction Protocol). It has been released in 2012 and ever since then has become a preferred transaction network because it allows for nearly free transfers of any kinds of assets, including fiat money and commodities, virtually instantly.
The Consensus Process of Ripple
One of the main advantages of the Ripple protocol is the fact that it can operate without the Ripple company itself. This is all because of the consensus processes applied. The ledger will keep on running for as long as the validators of transactions exist. Among the validators of the Ripple network are big corporations, banks, Internet providers, and even MIT.
This consensus ledger has been occupying the attention of companies all over the globe and many have adopted it as a settlement infrastructure. Each transaction that goes through it is encrypted and secured, and not chargebacks can be applied.
Ripple Coin Concept
XRP is one of the most popular cryptocurrencies available for trading and to buy and sell on every major cryptocurrency exchange. It cannot be mined. There is a finite amount of 100 billion units already created. More units cannot be created. Currently, the circulating supply is nearing the 40 billion units mark. 20 billion XRP have been retained by the creators of Ripple Labs, the other 80% of the 100 billion units are given away to users so that market makers can stimulate the markets and increase liquidity.
XRP is a digital asset that has been decentralized. It can be bought and sold and can be used to settle payments considerably faster than when using Bitcoin. Everything happens in just about 3-4 seconds. The network can hander 1,500 transactions per each second, constantly.
Are there Transaction Costs?
The minimum transaction cost at the moment is just 0.00001 XRP for common transactions which is considerably less than using Bitcoin. Considering the fact that at the time of this article a single unit of XRP costs a little over $0.53, this makes it one of the most accessible cryptocurrencies.
You can use the Ripple network even if you don’t hold currency units as a means to store value or as a medium of exchange. Accounts on the network require just a sanitary anti-spam minimum of 20 XRP. This is necessary because transaction fees apply on trades in non-native currency (one that is not XRP). As mentioned above, these fees start at 0.00001 XRP. The main purpose of these fees is to diminish the interest on part of hackers to flood the network with fake accounts and fake transactions.
Ripple Cryptocurrency In Practice
One of the main purposes behind the Ripple native currency XRP is to be used as a bridge currency. This finds a lot of applications in cases when there is no direct exchange between different assets or in cases of rarely traded currency pairs.
Upon its conception, the Ripple network has been designed with a main focus on being a currency exchange and a distributed ledger, more than an alternative currency. The autobridging functionality of the network has been introduced in 2015. It became a way for market makers to make transactions between rarely traded currency pairs.
In its essence, a bridging currency is intended to make it easier for market makers to move the markets by trading between various currencies. As we all know, there are thousands of assets people can use in order to engage in online trading. Currency pairs are probably the most popular ones, or the so-called Forex trading. But given that there are so many currencies in general, some might not be pair together, especially those traded more rarely.
A bridging currency will eliminate this problem. You can go on the Ripple network, purchase a given amount of units against fiat money and then used these units to buy another currency. Thus bridging the two otherwise not traded currencies. The XRP autobridging eliminates the need to support every currency pair there could be, and just bridge the ones people are interested in.
Ripple & XRP In the News
Ripple has a recurring presence in the cryptocurrency and Altcoin news. All because of the huge potential that the network and the currency both have. Its value is considerably stable but is expected to continue its steady rise. All because of the applications and usage of the native currency.
To add to that, the company – Ripple Labs, is still one of the most popular start-up tech companies in the cryptocurrency industry. Given the number of units they have retained, they can significantly move the markets if they decide to. Everyone is carefully looking at them and following their development because more innovations on their part are highly anticipated.
Of course, the most important thing that occupies traders’ minds is whether its price is going to rise. It is actually expected to climb in the second part of the year. All because the utilized advantages are much more than the negative aspects surrounding the network. Here are some more reasons why its price is expected to rise further:
- Accessible – Ripple XRP is not just cheaper than a huge number of other popular cryptocurrencies, it has been featured on the major cryptocurrency exchanges and people can easily gain units of it.
- Promising – Ripple XRP can minimize even further transaction costs, making it one of the most efficient real-time gross settlement systems (RTGS).
- Independent – Ripple XRP and the consensus Ripple protocol will continue to run even if something disheartening happens to Ripple Labs. All because the consensus for validation of transactions lies outside of the company that owns the network.
All in all, the Ripple network and the native currency XRP have significant advantages before its immediate competitors Ethereum and Bitcoin. That is why so many people have put their sights on it.
A Bright Future for Crypto
The Ripple cryptocurrency has been widely discussed for quite some time now. All of its advantages, as well as the drawbacks of the network, are well-known in the industry.
This has not stopped people from wanting to want more and to witness more of the future development of the network and its native coin. It is quite clear in the industry that Ripple has a bright future ahead of it and we are due to see many more surprises from this otherwise cheap and accessible currency. Mainly in terms of technological ingenuity. You won’t be wrong to keep a close eye on the future developments of Ripple, Ripple Labs, and XRP.
Hello, I am Collin Tyusm. I am a Forex blogger. I have created my blog, because I want to help people learn more about Forex & CFD Trading Software and Bots.