Think of Ripple as the internet of money. A whole new approach to the problem of real time transactions.
Blockchain technology has promising uses for the future. At least, that’s what all the Bitcoin enthusiasts say. Until Ripple came along, it wasn’t sure what direction blockchain was headed in to have any real application that could disrupt financial institutions as we know them today. Well, thanks to CEO Chris Larsen, CTO Jed McCaleb who took over from original Ripplepay founder Ryan Fugger, the team has come a long way in building a truly open source payment protocol.
What is Ripple?
It is a real time gross settlement network that can be used for payments anywhere in the world, using the currency of the bearer to transact with any currency. It is therefore realistic to assume that it will someday take over the cumbersome SWIFT banking methodology, which requires banks to have a separate account in each country they do business in. Ripple XRP is the digital currency that can be used on the Ripple network. For anyone trading in the Ripple XRP, a trust relationship (like a digital IOU) is not required on the Ripple network.
Unlike Bitcoin, Litecoin, Ethereum or countless other cryptocurrencies, Ripple is much more centralised. Because of this, it is almost like any other entity run through a corporation, as it controls Ripple.
Technology behind it
It can be thought of as the joker card in a typical card deck. It stands in the place of a currency of your choice and can be traded as such. This has wide implications for the quicker and seamless transfer of money across borders by banks that deal in blockchain technology.
The bank can therefore transfer money to a recipient country in the end currency through the blockchain, bypassing the slow and inefficient process of currency exchange, transaction fees and the time taken to validate.
Ripple XRP can be validated within seconds, with a transaction cost of 0.00001 XRP. Over 1,500 transactions can be conducted in a second on the Ripple network.
Value of Ripple XRP
It currently trades at $0.33. 100 billion XRP was initially created as the total amount of XRP that would ever exist. The supply in circulation is just 40 billion XRP. Ripple XRP cannot be mined, so transactions can only exist with the currency in circulation.
How to buy
Since anyone who wishes to trade on the Ripple network is required to own at least 20 XRP, it is a good idea to own a small reserve of this cryptocurrency. It can be purchased through cryptocurrency exchanges like Binance and Bittrex. It is recommended to store the XRP in a private wallet once purchased to keep it intact for future transactions. Also read: best way to store cryptocurrencies.
The future of XRP
With partnerships underway with major financial institutions, including American Express, it is destined to change the way banking is done. It has a strong focus on anti-spam measures through the use of the innovative transaction fee, which results in that much of the XRP being lost to the world. While this cryptocurrency may face competition from other upcoming technologies, it has a lot of potential to do a world of good, if its CEO Chris Larsen is to be believed.