XRP, without a doubt, had made quite a noise and is considered as one of the success stories in the crypto market. Aside from the large community of investors and supporters behind this platform, it is also one of the most controversial. Discussing how the XRP has reached its pinnacle of success, let’s have a brief overview by learning its history first.
What are Ripple and RippleNet?
Ripple is often used interchangeably with the RippleNet. The Ripple refers to the California-based company operating with approximately 200 employees. They own 60% of the entire XRP existence. Ripple uses the XRP as its settlement asset when transacting for international payments, with the help of its payment platform called RippleNet.
RippleNet, on the other hand, refers to the network that consists of banks and money services businesses. Together, they work as one to provide transfer solutions to the users, allowing you to transfer money from all over the world in just a matter of seconds.
What is XRP?
XRP refers to the token that represents the transfer of value utilized in the Ripple Network. It is designed to serve as the mediator for fiat and cryptocurrency exchanges. People in the industry often calls the XRP as ‘Joker.’ This card can be used in all transactions.
For instance, if you want to exchange your euros to dollars, or your dollars with dollars. The transaction in Ripple only costs $0.00001.
The Founders of Ripple (XRP)
The history of Ripple started way back in 2012. A group of talented innovators – Chris Larsen and Jed McCaleb founded the Ripple.
Chris Larsen is a business executive and an angel investor. As of today, he is honored as the wealthiest person in the cryptocurrency market. Larsen has founded multiple startups when it comes to online financial services. He started investing his money in 1996 in an online mortgage lender E-loan.
Jed McCaleb is a trusted and highly-recognized programmer and a young entrepreneur. He is the co-founder of not just the Ripple, but also the Overnet, eDonkey, Stellar, and Mt. Gox.
XRP began functioning in 2012 with a 100 billion supply. 20 billion XRP were reserved for the founders of the Ripple, and the rest were given as a gift to the OpenCoin Inc. Chris Larson’s share went up to 7 billion XRP, while Jed McCaleb has 9 billion XRP.
Albeit the OpenCoin Incorporated managed to have $9 million in the venture, it is, with no doubt, a small amount in Silicon Valley if you compare it to the ICO fundraising. The funds were not enough to support the public XRP Ledger and its associated commercial products in the long run.
With this in mind, the founders decided to gift all of their XRP to the OpenCoin Incorporated. The funds were placed in an escrow account secured by cryptographic.
Ripple Into the Crypto World
After its launching, Ripple created quite a ‘buzz’ in the digital world. Eric Voorhees and Vitalik Buterin started posting their XRP addresses in the thread to claim the airdrop.
Despite its popularity, Ripple has also been heavily criticized by the old Bitcoin investors. Some of them are alarmed that the success of XRP would dominate the cryptocurrency market and would affect their investments in the long run.
Fueled by alarm and worry, some of them offered bribes of up to $500 to pay people and claim that both Ripple and XRP are a scam.
A particular “TradeFortress” posted in the thread offering 5 BTC to anyone willing to edit their post in the thread and claim that the Ripple is a scam. This website reference has been shut down since.
In late 2013, the XRP community has expanded. Bitcointalk members saw the benefits they can enjoy and the potential that it has to offer. They switched to XRPChat and the community gradually grow bigger. As of today, the XRP community is the largest in the world of crypto, and it is functional in multiple social media platforms.
Ripple Protocol Consensus Algorithm (RPCA)
Compared to the Bitcoin, Ripple doesn’t utilize the blockchain technology. You may find it odd that the Ripple network functions without a blockchain. Blockchain technology verifies the transaction to ensure its confirmation. Ripple, independent as they are, has developed its own patented technology called the Ripple Protocol Consensus Algorithm or RPCA.
As the name implies, ‘consensus’ means that in every node, everyone agrees before making a decision. Just imagine a hundred contributors and supporters, all deciding and deliberating before making a choice. The RPCA works just like this. You can rest assured that every transaction has been verified and agreed with.
Pros and Cons
Let’s take a closer look at Ripple’s pros and cons:
- You can complete your transaction at Ripple as fast as 4 seconds.
- It only requires a minimum transaction fee of 10 drops (0.00001 XRP).
- XRP Ledger is ideal for enterprise and institutional use thanks to its heavy security and stability.
- No inflation.
- The value of XRP increases as more banks use it as their transaction platform.
- Ripple is centralized. Only the Ripple developers can decide when to release and how much they would release.
- It is a monopoly.
- It is an open-source and attracts a lot of hackers.
As of today, Ripple operates on more than 200 banks, money services companies, and payment companies in the US, Middle East, Europe, Brazil, and North Africa. Ripple and XRP have a lot to offer, attracting millions of people from all over the world. Since it is one of the largest communities in the crypto world, it can use some improvement. Albeit controversies are surrounding the Ripple and XRP, it is, without a doubt, a trusted transaction platform.
The future and success of XRP may be ambiguous. However, with its powerful software and its increasing popularity in the US, it is safe to say that soon, it will dominate a much larger scale in the crypto world and the market.