Ripple: everything you need to know about XRP

Wat is Ripple?

Ripple (XRP) is a transaction network with its own digital currency. It functions as a payment platform that many businesses and financial institutions also utilize. XRP can be exchanged for most other (crypto) currencies and helps users avoid the wait times associated with traditional banks. 

Hoe does Ripple work?

Ripple is a payment protocol that uses blockchain technology to process international money transfers. The platform is similar to the SWIFT system used by banks and financial institutions worldwide. Ripple offers low transaction fees and extremely fast processing times. It also collaborates with hundreds of financial institutions that use its technology. 

There's a common misconception that Ripple is a cryptocurrency; Ripple itself is not, but it has its own cryptocurrency called XRP. Anyone looking to invest in Ripple can purchase XRP. 

While Ripple has a lot of potential, it has also faced some significant issues. The most notable is the lawsuit filed against the platform by the U.S. Securities and Exchange Commission (SEC) in late 2020. 

In summary, Ripple is: 

• A blockchain-based digital payment network with XRP as its cryptocurrency. 
• One of the most valuable tokens based on market volume. 
• Primarily intended for banks, but individual investors can invest in XRP. 

The Technology Behind XRP

ust to clarify, Ripple is the company, XRP Ledger is the software, and XRP is the cryptocurrency of the Ripple network. The XRP Ledger is not a fork of Bitcoin but does use some aspects of it. Like Bitcoin, Ripple allows users to trade crypto using cryptography (with public and private keys). Digital signatures are required for transfers between two addresses. 

Although different from the familiar blockchain system, the Ripple process is relatively efficient and fast. This is a significant reason why banks and payment processors are considering using Ripple. The Ripple network also does not use mining and does not require specialized hardware to secure the ledger and validate transactions. 

Only transactions validated by "unique nodes," permissioned servers that maintain a "unique node list," can agree on which transactions are valid on the network. With this more trusted design, XRP nodes can quickly validate transactions as long as at least 80% of participants deem them valid according to the programmed rules. 

Slightly More Centralized Unlike the public nature of Bitcoin and Ethereum, which aim to disrupt the financial world, Ripple seeks to improve the traditional banking system. It does so by uniting a network of independent banks and payment providers with a standardized protocol. The goal is to communicate and send low-cost, instant payments globally. 

Furthermore, Ripple is not as decentralized as Ethereum, for example. Developers have some control over the mechanism protecting the system from malicious actors. This means that Ripple can technically determine which servers are allowed on the network, making it a central authority. That's why some critics even argue that XRP isn't a true cryptocurrency. Nevertheless, XRP is one of the older and more popular coins in the crypto space. 

Slightly More Centralized 

Unlike the public nature of Bitcoin and Ethereum, which aim to disrupt the financial world, Ripple seeks to improve the traditional banking system. It does so by uniting a network of independent banks and payment providers with a standardized protocol. The goal is to communicate and send low-cost, instant payments globally. 

Furthermore, Ripple is not as decentralized as Ethereum, for example. Developers have some control over the mechanism protecting the system from malicious actors. This means that Ripple can technically determine which servers are allowed on the network, making it a central authority. That's why some critics even argue that XRP isn't a true cryptocurrency. Nevertheless, XRP is one of the older and more popular coins in the crypto space. 

Benefits of Ripple

Ripple's birth year of 2012 makes it one of the oldest cryptocurrencies, and as a result, the coin has garnered many loyal fans. Here's why they choose XRP: 

• High transaction speeds, around four to five seconds (compared to minutes for Bitcoin). 
• Very low transaction fees of only 0.00001 XRP. 
• Versatile exchange network: The Ripple network can also be used for many other cryptocurrencies and fiat currencies. 
• Ripple is used by major financial institutions. Santander and Bank of America, among others, utilize the transaction platform. 
• The high market volume makes the coin less susceptible to price fluctuations. 

Drawbacks of Ripple

No cryptocurrency is perfect. What should you consider when investing in XRP? 

• Somewhat centralized due to a group of "default" validators on the network, contradicting the fully decentralized nature of most blockchains. 
• There's a significant amount of pre-mined XRP. Releasing a large number of new coins at once can affect the value of XRP. 
• The U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ripple in 2020, alleging that the company should have registered XRP as a security. Ripple denied these allegations. 

Who is the founder of Ripple?

Ripple is the brainchild of the company Ripple Labs, formerly known as OpenCoin. This company was founded by Chris Larsen and Jed McCaleb in 2012. Larsen and McCaleb both played crucial roles in developing Ripple. Together, they established Ripple as a blockchain-based solution for financial institutions and cross-border payments.

The CEO of Ripple is Brad Garlinghouse. Garlinghouse has been leading Ripple since 2017. He played a significant role in the adoption of Ripple's technology within the financial sector. Garlinghouse has a background in the technology industry and previously worked for major companies like Yahoo and AOL before joining Ripple.

Price forecasts for Ripple

In 2026 experts expect a minimal price of €1.53 and a minimal price of €5.06 in 2031.

Frequently asked questions