Due to this, Ripple is said to eventually become a replacement for SWIFT — the current standard for international bank wires, that includes slow speeds and high fees. Ripple may also disrupt traditional cross-border payments brands such as Western Union and MoneyGram, and at one point acquired an ownership stake in MoneyGram, sending the price of the stock skyrocketing. Because Ripple could potentially become the new standard across so many industries.
Ripple has among the highest long-term price potential out of any crypto assets. XRP is the native cryptocurrency of the Ripple protocol. Ripple is both the blockchain network that XRP is transferred over, and the name of the company that created the crypto token and helps to push its adoption at banks and other cross-border payment companies.
The XRP coin is designed to improve speeds over existing cryptocurrencies, making it especially attractive as a payment currency. For example, Bitcoin takes as much as 10 minutes to confirm a transaction, while confirmations using Ripple and XRP take as little as 5 seconds. Jed McCaleb is no longer associated with the project and launched a similar cryptocurrency, Stellar, which is competing with Ripple for the cross-border payments market.
However, Ripple dominates this industry and shows no signs of letting a competitor steal their thunder. The chief US regulator claims that XRP tokens are unregistered securities, and Ripple the parent company has broken laws by offering unregistered securities to investors in the United States. The asset has been delisted from most cryptocurrency exchanges which could cause the asset to struggle in the long term.
However, Ripple won a request from a court judge to force the SEC to release documents related to how the entity arrived at deeming Bitcoin and Ethereum not securities. XRP is still performing relatively well despite the issues with regulators, although it has yet to make a new all-time high like many other cryptocurrencies.
It is currently trading at around 90 cents per XRP. They generally take four to five seconds, compared to the days it may take banks to complete a wire transfer or the minutes or potentially hours it takes for Bitcoin transactions to be verified. Very low fees. The cost to complete a transaction on the Ripple network is just 0.
Versatile exchange network. The Ripple network not only processes transactions using XRP, but it can also be used for other fiat currencies, cryptocurrencies and commodities. Used by large financial institutions. Large enterprises can also use Ripple as a transaction platform. Ripple Disadvantages Technically centralised.
One of the reasons that cryptocurrencies became popular is that they were decentralised , taking control away from large banks and governments. The Ripple system is centralised and goes against this philosophy. Ripple Labs controls the XRP supply. Ripple Labs decides when to release coins, giving it control versus other cryptos where coins are slowly and steadily released by mining.
This means Ripple Labs has more power to influence the value of XRP by deciding when and how many tokens to release. Recent regulatory action against XRP. Until this gets resolved, it could slow down institutional use of this system. Several exchanges, such as Coinbase, have also stopped listing XRP as a result.
You could also use the Ripple network to process other types of transactions, like exchanging currencies. For example, if you are looking to swap Australian dollars for Euros, you could first exchange your AUD for XRP on the Ripple network, and then use those to buy Euros, rather than handling the currency exchange directly through a bank or money-changing exchange. This can be a much faster and cheaper approach versus paying the high fees banks and money remittance organisations may charge.
Featured Partner.
APOLLO CRYPTOCURRENCY PRICE
So, now that you know some of the concerns that people have regarding the decentralization of both projects, the next part of this Ripple vs Bitcoin guide is going to discuss how transactions reach consensus. Neither of these protocols requires a third party to confirm, verify and audit transactions. So, how do they do it?
Firstly, let me quickly explain what a consensus mechanism is. Every blockchain uses a cryptographic algorithm to confirm that a transaction is valid without going through an intermediary. This ensures that the person sending the money actually has the funds, and it also makes sure that the funds are not spent twice double-spending.
Bitcoin and Ripple each use a different consensus mechanism, which I will discuss below. Consensus Mechanism Bitcoin: Proof-of-Work The first-ever blockchain consensus mechanism was created by the developer of Bitcoin, and it is called Proof-of-Work.
The best way to understand Proof-of-Work is to think about a really difficult calculation. The Bitcoin network generates a random calculation that is so difficult that no human could solve it. Instead, it requires a large amount of computational power to solve. The calculation takes 10 minutes to solve. Once it is solved, the Bitcoin transaction is confirmed as valid. Every single node that is connected to the network competes with each other to become the first device to solve the calculation.
Whoever gets there first, wins the Bitcoin mining reward. The main problem with the Proof-of-Work model is that it requires really large amounts of electricity. For example, a recent study revealed that Bitcoin mining consumes more electricity than individual nations! The second issue with Proof-of-Work as I discussed earlier is that it allows people to use really expensive hardware, meaning that those who can invest more money have a much higher chance of winning the Bitcoin reward.
Thirdly, and possibly most importantly, the Proof-of-Work model has contributed to the issues of high fees, slow transactions and the inability to scale. So, now that you know what consensus mechanism Bitcoin uses, the next part of my Ripple vs Bitcoin guide is going to look at what Ripple uses! Its creators kept 20 billion and gave the rest to the company.
Ripple uses a novel consensus algorithm PDF to validate transactions, and it recommends that clients use a list of identified, trusted participants to validate their transactions. This stands in stark contrast to Bitcoin, where anyone can become a miner. But XRP was never meant to be another Bitcoin.
The idea is that this will in turn will make the currency more valuable. They settle the transactions later, using fiat currency.
Is ripple the next bitcoin ps4 to mine ethereum
CEO BINANCE Confirmed That Ripple XRP Is Next BITCOIN! 🚨Apologise, wh betting trends recommend you
FOREX DERIVATIVES IN INDIA PDF
The idea is simple — the more ASIC devices you have, the more chance you have of winning the reward. Most of these mining pools are located in China, where electricity costs are cheap. This puts a lot of power into the hands of a very small amount of people, which goes against the decentralized ideology of Bitcoin. Firstly, unlike Bitcoin, the Ripple coin is controlled by a company called Ripple Labs.
At the time of writing, June , there are approximately 60 billion coins in circulation, of a total supply of billion. They have the power to do what they want with the coins, meaning they technically can manipulate its price. If Ripple Labs decided to issue a large amount of the coins they control, it could negatively affect the price. In the case of Bitcoin, although the system has become dominated by large mining pools, anyone can attempt to contribute to the network by purchasing the required hardware.
The only people that can become a transaction validator are the banks that install the technology. Technically speaking, it is still decentralized because no single validator can take control of the network, nor can they amend or manipulate a transaction. However, some people think that everyone should have a chance to contribute to the network, not just financial institutions.
So, now that you know some of the concerns that people have regarding the decentralization of both projects, the next part of this Ripple vs Bitcoin guide is going to discuss how transactions reach consensus. Neither of these protocols requires a third party to confirm, verify and audit transactions.
So, how do they do it? Firstly, let me quickly explain what a consensus mechanism is. Every blockchain uses a cryptographic algorithm to confirm that a transaction is valid without going through an intermediary. This ensures that the person sending the money actually has the funds, and it also makes sure that the funds are not spent twice double-spending. Bitcoin and Ripple each use a different consensus mechanism, which I will discuss below. Consensus Mechanism Bitcoin: Proof-of-Work The first-ever blockchain consensus mechanism was created by the developer of Bitcoin, and it is called Proof-of-Work.
The best way to understand Proof-of-Work is to think about a really difficult calculation. The virtual currency is certainly on the rise and has the potential to be the first token to truly disrupt an industry, and if it does, expect XRP to reach Bitcoin-like levels of ubiquity in the near future. Could you be next big winner? Ripple certainly has the potential to move up a notch in , but I think it will be more likely in The early investors of Bitcoin had to wait almost a decade to reap the rewards and drive that Lamborghini out of the showroom.
Ripple may not take a decade but it certainly will not happen overnight. Consumer awareness needs to increase along with direct trading in fiat for it to start moving upwards again. Work with the Regulators Ripple CEO Brad Garlinghouse has, meanwhile, said that for the industry to move forwards it has to work with the regulators, not against them.
Currently, XRP is down 4. Will Ripple be the next big thing in the crypto industry?
comments 0