Ripple – The Ultimate Beginner’s Guide

Ripple is quite different from conventional cryptocurrencies. It is a payment protocol built on top of a distributed ledger. Ripple was launched in 2012 by the Ripple company. Even though the protocol is open-source, ripples (the currency used in the Ripple network) have all been premined by the developer company and cannot be mined by the network participants. However, it is not very important if you only plan trading ripples speculatively.

The common symbol for ripple units on exchanges and brokers is XRP.

What is Ripple

Ripple Cryptocurrency is an open payment system in beta. Its goal is to allow people to break free from the financial institutions like the banks, credit card and other networks that enforce fees and delays. As per market size and capital, Ripple is the third-largest cryptocurrency, sitting just behind Bitcoin and Ethereum.
Ripple now has billions of dollars’ worth of cryptocurrency on account. It was built as a digital payments network for real-time financial transactions, and is also the core owner of Ripple XRP, the digital coin which increased 40 times in 2017 alone.
To avoid confusion, the network is referred to as Ripple, and the ripple coin as XPR – Ripples. The frequency of releasing new coins into the system influences the price and rate. In total, there are 100 billion XRP that exist, and Ripple owns approximately 60 percent of the XRP. If you take all this valuation into account, it would be worth more than several US tech startups put together. XRP is majority owned and tied to a single company.
Ripple is constantly investing in its network and growing partnerships with global firms and financial institutions. Some of the banks that have signed on to use Ripple include BBVA, SEB, Start One Credit Union, and Cambridge Global Payments. As the market and network continue to grow, Ripple’s value has potential to further increase.

Ripple Model

Based on the Ripple website, their concept is a “basic infrastructure technology”.

The idea of Ripple was developed in 2004 by Ryan Fugger from Vancouver, Canada. During the following ten years, the digital was being developed until finally in 2014 various large banks started using Ripple and the payment networks. The Ripple system, for them, has advantages like the distributed legers, price and security. They offer this alternative to “remittance “or a “settlement system” option.

The company behind Ripple is “OpenCoin”. There are two separate entities that make up the Ripple; There is the payment network and the actual currency on the payment network. Building on the decentralised digital system, Ripple’s main idea is to work with different payment systems worldwide.

Ripple allows businesses to perform transactions within 3-5 seconds. The payments are processed and received automatically, and are irreversible. Various financial institutions worldwide have established partnerships and started using the Ripple system.

In many ways, Bitcoin and Ripple are similar. Like Bitcoin, the Ripple coin has a limited number of units that can be mined. Both can be transferred from peer to peer, and both have digital security keys to prevent face transactions of coins. Payment information on the ledger is private, however transaction information is public.
Ripple insists that they provide faster transaction times than Bitcoin, because confirmations of transactions can go through their network very quickly. There is no waiting on block confirmation, and transactions go through the network very fast.

The Differences Between Bitcoin and Ripple


  • Both are open source – not owned by any one company or any individual
  • Transactions for both can be anonymous and free on the internet


  • Ripple is faster in processing transactions and more energy efficient than Bitcoin
  • Ripple is a decentralised transaction network which has a digital currency, Bitcoin is a decentralised digital currency
  • There is a set number of Bitcoins which is still slowly increasing
  • There is a defined number of XPR (Ripples) of 100 billion

Main difference: 
Bitcoin wants to change what we are paying with; Ripple wants to change how we are paying.

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