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Ripple (XRP)

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What is Ripple (XRP)?

Started in 2012, Ripple is the name of the company running an open, cross-border payment system to interconnect banks and money services called RippleNet. RippleNet is a real-time gross settlement (RTGS) system that aims to enable instant global monetary transactions. RippleNet is built on the XRP Ledger, an open-source distributed database ledger. Finally, XRP is the cryptocurrency native to the XRP Ledger. However, any currency can be used to transact on RippleNet.

 

What makes it unique?

  • One of the most popular cryptocurrencies, XRP has consistently ranked among the top ten cryptocurrencies by market cap;

  • Briefly occupied the #2 most popular cryptocurrency spots, overtaking Ethereum in 2017 and 2018. However, recent regulation headwinds have caused the token to fall slightly in the top ranks;

  • Designed as an alternative to Bitcoin, XRP set out to offer cheap, fast, and trustless cross-border payments;

  • Uses a unique consensus mechanism known as the Federated Byzantine Agreement (FBA) model; 

  • Uses trusted validator nodes as opposed to Bitcoin’s mining to validate and record new transactions;

  • Given it does not require mining to produce coins, 100 billion XRP was premiered in 2013.

 

Purpose

The idea behind Ripple goes far back, before cryptocurrencies and even before Bitcoin. The idea started in 2004 when John Fugger launched a peer-to-peer (P2P) financial network called RipplePay. Through development, Ripple focused on making a hybrid model to combine traditional banking structures and peer-to-peer systems. This unique position made Ripple of significant interest to introduce the traditional finance sector to cryptocurrencies. Through its development as a cross-border payment system Ripple has gained the attention of large financial institutions such as Santander and Bank of America. They have also gained significant regulatory attention from the SEC. 

 

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