With a 35,000% increase in value in 2017 and a market cap of more than $ 118 billion, Ripple has become a top topic among analysts and investors. But, what is Ripple? Is it like other cryptocurrencies? Why is it burning up lately? Keep reading to get the answers to these questions.
1. What is Ripple?
Ripple is a payment solutions company, founded by Chris Larsen and Jed McCaleb. Their Ripple Transaction Protocol (RTXP) includes the cryptocurrency XRP. Ripple claims to offer faster, more reliable, and affordable transaction solutions for financial institutions. The company has generated one hundred billion XRPs and now it holds 61% of the coins. The current plan is to release a billion coins every month.
2. Differences Between Ripple and Bitcoin
Both Bitcoin and Ripple are cryptocurrencies that use block-chain technology. However, there is a fundamental difference between the two: unlike Bitcoin, Ripple cannot be mine. The money is not set up as a meager currency, and its use is fixed by the Ripple network.
Both Bitcoin and Ripple use validate nodes for validating ledgers. Bitcoin has about 10,000 trusted nodes, while Ripple has only five. However, the company plans to add 11 more in the next 18 months. The five authenticating nodes are controlled by Ripple. XRP has received criticism for lack of independent confidence among testers. XRP Ledger is available to everyone, so anyone can download it and become a testimonial. Many companies run their own nodes in the Ripple network.
3. Reasons for Current Ripple Price Growth
The current increase in the price of XRP has a lot to do with the expected use of money by financial institutions and investment by believing investors. Ripple has been successful in getting banks as customers for other products. Ripple’s xCurrent is preferred by financial institutions because it offers real-time communication and quick corrections, thus minimizing delays in bank transactions. The company plans to introduce a new product, xRapid, that is included in XRP. They see the new product as an opportunity to get banks to use XRP. Investors see the potential of money as a remnant of money used by banks around the world.
Ripple, or more accurately, XRP, is a rising cryptocurrency. It differs from the mainstream digital currency Bitcoin because its supply is controlled by the promoter company. Ripple is banking on banks that will adopt it in the future. One can assume that the recent rise in the value of Ripple will spark a lot of debate about its viability as a cryptocurrency asset.