By: Ximena Peinado
The RIPPLE XRP cryptocurrency was created in 2012 with the same goal as its competitors: to eliminate friction in payments and to allow financial institutions to send money across borders, instantly, reliably and for fractions of a penny.
This encrypted currency belongs to the RippleNet platform, which, unlike Bitcoin or Ethereum, is centralized, objectionable and has its own technology known as RPCA (Ripple Protocol Consensus Algorithm). Another differentiating feature is that it does not compete directly with fiat currencies, as Bitcoin does.
Fiat currencies are those that in themselves are worth nothing, however they have the value that is arbitrarily assigned by consensus.
More about XRP
XRP cryptocurrency is known as the cryptocurrency of banks. The Ripple protocol is intended to be a complement to the current banking system, where it helps international transfers to transform from fiat money, gold and even airline miles.
The goal behind its design was to make such transactions with XRP faster, cheaper and more scalable than with any other digital asset. Today, this cryptocurrency is worth around £ 0.269 ($ .32).
Currently, RippleNet has more than 300 financial institutions in 40 countries and 6 continents as clients, which helps to grow their business and position money in the same way in which information moves today, a concept that company called Internet of Value.
In other words, there is no need for a “trusted” entity to mediate, carry out and confirm transactions.
The idea for Ripple was thought of in 2004, but it wasn’t until 2012, when Jed McCaleb invited a group of investors, that it was officially founded. Chris Larsen was one of these early investors and is one of the richest people involved in the crypto world.
For the exchange of assets there is another platform called Swift, which also has a system that is based on banks having separate accounts in all the countries in which they operate. However, Ripple has other advantages such as low commissions in currency exchange and offers much faster transactions than other cryptocurrencies.
Advantages of RIPPLE XRP
The average time of a transaction can be 1,500 to 50 thousand transactions per second. By comparison, Bitcoin only has a speed of three to six transactions per second.
In addition to this, RippleNet surpasses Swift for being specialized in banks and financial institutions. It also has the XRapid innovation, which facilitates payments to suppliers and banks by connecting world currencies with XRP as a bridge asset, thus causing the speed of international transactions.
Another difference it has compared to Bitcoin is that there are no miners in Ripple. That is, there can be no new XRP because there is a unique consensus mechanism distributed across a network of servers to validate that all XRPs are pre-prepared. Mining cryptocurrencies does not mean making new crypto coins; This is how the set of processes necessary to validate and process the transactions of a cryptocurrency is done. In the case of Bitcoin, mining is validating and recording the transactions of the blockchain.
In addition, Ripple has more units than its direct competitor, since while Bitcoin has only a supply of 12 million units, Ripple has 100 billion pre-mined coins.
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Sources: Ripple Offical Site, CMC Markets, Money Man, Academy.bit2me.com, WeLiveSecurity