Ripple (XRP) is a top-performing cryptocurrency that shows promise as adoption increases, but should you buy Ripple?
- Price$ 0.40821
- Marketcap$ 19.72 B
Ripple (XRP) is a cryptocurrency that performs in the top ten market cap and is the most talked-about for potential investors due to the rapid adoption of its network and celebrity backing, prompting many people to buy XRP.
However, is it worth it to buy Ripple? What makes Ripple different from other altcoins?
Read on to find out more about Ripple (XRP), what it is, how it works, how to store, and how to invest in Ripple.
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What is Ripple (XRP)?
Ripple gets its name from its founding organization called Ripple Labs Inc., established in 2012. It is a US-based company that uses real-time gross settlement systems, specializing in money transfers.
The goal is to be a cost-effective platform to transfer money globally.
Ripple has an exciting history, as it started with an American programmer called Jed McCaleb, who founded Ripple Labs Inc. Arthur Britto and David Schwartz came on board to design Ripple and increase its functionality to help facilitate payments.
Currently, the CEO of Ripple Labs is Brad Garlinghouse, who has an extensive business background.
Ripple Labs then came up with a cryptocurrency, called Ripple, using the XRP acronym. XRP is different from other cryptocurrencies, particularly Bitcoin because it uses a hash tree, making it unable to be mined.
XRP now becomes a more eco-friendly, scalable crypto as there are growing concerns for mining for the environment. XRP comes from Ripple’s xRapid technology that powers payment providers.
Ripple still works on a blockchain with multiple nodes to process the transaction. Once someone sends a transaction, the information is shared to a public database, validated, authorized, and processed.
The process is not “proof-of-work” like Bitcoin and is more consensus-based.
How Does XRP Work?
Ripple is a cryptocurrency that can process 1,500 transactions per second, compared to Bitcoin that can handle three to six transactions. Other popular altcoins such as Ethereum can commit to 15 transactions in a time frame.
This time frame shows Ripple is faster than its predecessors.
Ripple is not decentralized like Ehtereum, as developers control the systems to prevent malicious operators from taking over. Although, this means Ripple owns what is accepted on their servers, prompting people to state XRP is not a real cryptocurrency.
Fortunately, its relatively efficient processing mechanisms allow it to be adopted by 100 banks worldwide as a payment processor. XRP itself is not adopted, but these banks use the same RippleNet network.
How Do You Store XRP?
As a result, exchanges shed themselves from liability by suspending XRP trading.
You can still purchase XRP by buying Bitcoin or Ethereum, exchanging it for XRP, and storing it in a wallet. The best wallets to use are cold wallets, as exchanges do not specialize in keeping cryptocurrencies safe.
There are hot wallets or software storage, such as desktop wallets, where you can store XRP, although you may lose access to the wallet if anything happens to your computer.
Most wallets have a passphrase or recovery phrase and a backup code in case you lose access. The safest bet is to use a cold wallet such as Ledger or Trezor to store XRP off-line to reduce chances of hackers stealing your XRP.
Lastly, XRP requires 20 XRP to store into a wallet that is essentially a payment. The 20 XRP is not redeemable and is a minimum reserve requirement upon activation.
Should I Invest in Ripple?
Ripple has proven to be a scalable and effective crypto as it aims to be a payment processor globally. There has been a history of Ripple adoption within some of the biggest names in finance, such as Santander.
While these finance companies use the blockchain technology and network that powers XRP, the crypto itself has been part of a controversy that may deter investors.
For instance, the SEC determined that XRP is a security and charged two of its executives, Christian Larsen and Brad Garlinghouse, to sell 1.3 billion in securities to raise money. The SEC argues XRP is unregistered security.
As Ripple battles the SEC, crypto exchanges de-platformed XRP making it hard for new people to invest. However, these crypto exchanges, such as Coinbase, resumed selling XRP as Ripple began to make strides in their lawsuit brought on by the SEC.
Despite the controversy, there is a max supply of 100 billion XRP with 46 billion currently circulating. It is consistently ranked in the top 10, at times in the top five, of cryptos based on the market cap as people still participate in high-volume trading with XRP.
Since its inception, XRP has risen as high as $3.20 in 2018 after less than one cent for many years. In 2020 and 2021, during the second bull run, XRP went from .10 cents to $1.8, which is a 1700% increase.
Despite other cryptos having higher gains, the XRP hype may still be around.
Ripple is a company with a proven system for speedy, scalable payments that can occur globally.
Its cryptocurrency XRP shows promise for investors despite issues from the SEC. Coinbase and others have resumed trading XRP, showing trust in the coin as investors actively trade the sixth-highest crypto based on market cap.
Ripple is still an excellent investment with high daily volume amongst investors, waiting for its moment to achieve the same success as Bitcoin and Ethereum. XRP and its technology are a hidden gem, as no other crypto has been adopted by 100 global banks as a payment processor.
Overall, investing in XRP may be the beginning of new technology that we may see in our wallets, from credit card processors such as Visa and American Express to our banks utilizing RippleNet to exchange money transfers between countries.
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I’m Donny. I’m a world traveler, investor, entrepreneur, and online marketing aficionado who has a big appetite to compete and disrupt big markets. I thrive on being able to create things that impact change, difficult challenges, and being able to add value in negative situations.