Focus Coin - Ripple (XRP)

A brief look what the Ripple platform does and the history of XRP

April 2020, 2 min read

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C ryptocurrencies came into existence with the advent of bitcoins only ten years ago. So, in practical terms, these digital currencies are still in their initial stages. Many digital currency analysts expect that it will take another decade to get this kind of currency main stream.

Nevertheless, cryptocurrencies are now finding their way through society fast and while uncertainty is still a challenge to integration, the road to adoption and real-world utility is growing smaller as many cryptocurrency initiatives are convincing the world of their application, such as Ripple's XRP for inter-bank trades and money transfers. XRP is a tremendous benefit for those in developing nations who send money back to their families by drastically reducing the costs of remittances.

Ripple is both a currency and an open-source peer-to-peer payment platform that has been specially established to allow for quick and inexpensive currency independent transactions. Unlike Bitcoins, which had never been planned as an easy payment gateway, Ripple was designed to bridge the gap between international transactions.

Ripple aims to address many of the current cross-border banking issues that are currently plaguing the financial ecosystem globally. Anyone who sent a wire transfer through the banking system knows that cross-currency settlement can take many days and is often quite slow.

Ripple claims that these settlement issues are caused by a manual settlement made to translate the transactions of one bank's ledger system into another bank's ledger system. However, Ripple introduces something called the Inter-ledger Protocol, which uses a new cryptocurrency, Ripple XRP, to settle accounts across two banks with different ledgers, allowing for much faster settlement times. The virtual currency acts like a bridge between different fiat currencies as well as a source of liquidity. The technology behind the cryptocurrency is called the XRP Ledger and functions as the blockchain residing in the XRP token. The ledger is community-based, implying only users can decide whether it is successful or not.

Social media is part of the reason why the token has recently become so popular. As ICOs become more popular and people invest more, the cost of cheap altcoins attracts a lot of people to invest in it. Although the massive volume of Ripple tokens is one of the main reasons why the token is so "cheap," the price is all relative if the total volume of the token is not taken into account. The Ripple Network currently stands at $8 billion Market Cap, right behind Bitcoins ($123 billion) and Ethereum ($17 billion).

The Ripple Network was developed as an official institution focused on revolutionizing the banking community. And because of that, other cryptocurrencies such as BTC are currently facing will not be an active subject of regulation revision.

Although the currency looks extremely promising, there is still a huge value gap between BTC, ETH and XRP. When people talk about bitcoin, they think about the digital money you send to anywhere in the world without any limitations. On the contrary, the Ripple Network is heavily invested in the banking and finance sectors and can easily be integrated into society, making the future of Ripple more stable.