Most people who aren’t well-versed in the cryptocurrency scene only think that bitcoin is the only option, and we don’t blame them! Being the most popular form of cryptocurrency, bitcoin has the most traction from veteran and beginner crypto-enthusiasts alike.
However, if you’ve got your eye on learning about the current cryptocurrency scene, keep your eyes peeled on Ripple and XRP, or you may regret it!
What is Ripple?
To put it simply, Ripple is a for-profit business that serves the banking system. Being the company behind XRP, Ripple is a payment settlement system and currency exchange network that can fully process transactions on a global scale!
Ripple labs saw the glaring issue of transferring money on a global scale and wanted to address that issue directly. Ripple wants to enable banks and other businesses in the finance industry to be capable of sending money quickly and cheaply instead of having to extend the process to days or even weeks.
Ripple aims to be a safer, cheaper, and quicker alternative to SWIFT—currently the most popular protocol that banks use for international transfers.
How Does Ripple Cover the Shortcomings of International Transfers?
Not every bank can reliably convert the money you’re sending internationally into the desired currency without asking for huge fees, so how does Ripple mitigate this?
Ripple covers all of this through what they call RippleNet or xCurrent. This uses a decentralized system that uses a unique node list to solve the issue of the speed of international transfers. Using RippleNet to help you transfer money is cheaper and comes with tools to help mitigate the risk of getting scammed through anti-money laundering compliance and fraud detection.
If this sounds far too good to be true, well-known companies like American Express have partnered with Ripple, which vouches for their validity.
What is XRP?
Ripple Labs has also made a cryptocurrency called XRP that works on the blockchain, similar to most cryptos in the market. The difference here is that XRP transactions are confirmed in a few seconds and only cost around $0.0002. The blockchain can also handle over 1500 transactions per second, which is noticeably fast in comparison to other blockchains.
How does XRP come into play, and why is it so important that we talk about it in a video focused on Ripple and xCurrent? Simply put, it’s because XRP is self-sufficient, while Ripple labs need XRP to sell the current system that they’re so proud of.
XRP has a fixed cap of a hundred billion coins, so you don’t have to worry about the value going up and down as years go on. To add a bit more information on why those numbers are important and how they’re distributed:
- Founders of XRP – 20 billion
- RippleLabs – 7 billion + 1 billion XRP per month
- Companies/individual investors – 40 billion
This can be a problem because XRP is deflationary since fees are constantly burned, and some keys get lost or forgotten. This issue is why in some areas, stablecoins can be seen as a lot better in contrast to XRP.
If you enjoyed this post and video below, a like or quick subscription could go a long way! I hope we cleared most of the questions you guys have on Ripple and XRP!
This post & videos are for educational and entertainment purposes only – THIS IS NOT FINANCIAL ADVICE!
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