Often referred to as the banks’ bitcoin, Ripple (XRP) is one of the new crypto currencies on the market. Ripple’s primary goal is to have a system that works quickly and scalably, enabling the exchange of digital assets in real time.
What distinguishes this cryptocurrency from the mass is the storage of all transactions, as well as their equivalent value in the ripple blockchain. So the network can function as a large database storing the promissory notes that banks issue to each other.
How did the cryptocurrency come about?
The cryptocurrency Ripple emerged simply from the idea of the complicated process to make the cross-border transfers of money from banks safer, easier and above all faster: In the previous process, it is necessary that the banks send the money through many intermediaries to the actual recipient, what both carries a high risk and takes a lot of time. XRP should facilitate this path and exclude the intermediaries from the transaction.
In addition to the costly transfer of money through intermediaries, Ripple also use to offer a high degree of transparency during a transaction, so that customers can always be sure what is happening with their money. To summarize, the reason Ripple was founded was to fill a gap in the market and satisfy the demand for a cryptocurrency with affordable transaction costs and a fast transfer.
How does the Ripple Blockchain work?
The Ripple Blockchain is based on the issuance of IOU’s that are issued to each other by users of the cryptocurrencies. IOUs work much like promissory notes and store off how much of which currency a person owes to another. Another important role in the functioning of XRP is the “gateways”: they accept payment instruments and issue IOUs for them; so to speak, they act as the banks of the ripple system.
What are the benefits of Ripple over Bitcoin?
In contrast to other cryptocurrencies such as Bitcoin, XRP’s new mode of operation enables significantly shorter transaction times: while Bitcoin transactions have a minimum duration of 10 minutes, the system only needs between 5 and 10 seconds.
Another advantage to buy xrp is the low transaction cost, which is only a fraction of that of Bitcoin. While Bitcoin still charges $ 2.70 per transaction at a low transaction cost point, Ripple is undercutting it at just $ 0.0007 per action.
The unbelievable breakthrough of Bitcoin, which first brought cryptocurrencies into the general interest, also increased the price immensely: the price peak stagnated at over 15 thousand US dollars and is now, at a relative low, still above 5 thousand US dollars. XRP is offering a price of less than a dollar.
In summary, Ripple is faster and in two ways cheaper than Bitcoin and definitely worth an investment.