What Are Ripple and XRP?

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Ripple is an online payment protocol similar to many we’re familiar with, but it uses blockchain technology to process international money transfers. It offers very low transactions fees and extremely fast processing times and has found itself partnered with hundreds of financial institutions that use its technology.

It can be common to hear people refer to Ripple as a cryptocurrency – it is not. Ripple however does have a native cryptocurrency called XRP, investing in which supports Ripple itself. It can be likened to ETH and Ethereum.

Ripple has often been seen as somewhat of a renegade in the world of payment platforms and has even gotten into hot water with authorities in the past. Most notably with the SEC, who filed a lawsuit against Ripple in 2020.

Origin of Ripple and XRP

The origin of Ripple is owed to software developer Ryan Fugger, who first founded RipplePay in 2004. RipplePay allowed users to extend credit to others in the community. RipplePay is one of the rare examples of a quasi-crypto project that appeared before Bitcoin. Bitcoin’s creator, Satoshi Nakamoto, mentioned Ripple once in an email about cryptocurrency.

Programmer Jed McCaleb began development on the XRP cryptocurrency and blockchain in 2011. He approached Fugger about using RipplePay in 2012, and Fugger handed over control of the network.

They launched the partnership in 2012, which was originally called NewCoin, then OpenCoin, and finally, Ripple.

Ripple went hard to work making partnerships with financial institutions. In 2019, the company announced that it more than 300 financial institutions in more than 45 countries were using its RippleNet payment network.

It hasn’t always been clear skies for Ripple, however. On December 22, 2020, the SEC filed a lawsuit against Ripple for selling $1.3 billion in unregistered securities through its XRP cryptocurrency. Ripple denies this, stating XRP is not a security, and many are on their side.

How Ripple works

The purpose of Ripple is to provide cheap, reliable, and fast international transactions for banks. This makes it an alternative to SWIFT, its main competitor and the current international payment system most banks use. Ripple went so far as to hire SWIFT board member Marcus Treacher as its global head of strategic operations in 2016.

There are several advantages Ripple offers:

Quick Transactions – most transactions take less than five seconds
Low Fees – The transaction fee is 0.00001 XRP, which even at the coins all-time-high was less than a fraction of a cent.
A Bridge – XRP can be used as a bridge currency. This gives financial institutes a cheaper way to trade currencies.

Though Ripple has a large target on the back of SWIFT, it is difficult to topple the dominance of such a system.

How XRP Functions Differently To Other Cryptocurrencies

Many cryptocurrencies use mining as a way to verify transactions, which involves high-end machines solving complex mathematical equations. XRP instead verifies transactions through a consensus protocol. The majority of the validators who review a transaction must accept that it is valid.

XRP is considered to be faster, cheaper, and more energy-efficient than other cryptocurrencies. Because of the consensus protocol, XRP conducts its transactions in seconds at low lost, with minimal energy. Many consider XRP to be the “Green” choice in cryptocurrencies. Other cryptocurrencies are considered to be quite slow in transactions and have come under fire for their high energy consumption.

XRP is much more limited in supply compared to other cryptocurrencies. For example, Bitcoin has a supply of 21 million coins, while XRP has 100 billion. This also means the price of XRP is much, much lower.

XRP was pre-mined, meaning all 100 billion coins were minted before it launched. Ripple itself locked 55 billion of these into escrow, and a smart contract was setup up to release one billion XRP from escrow monthly.

Lastly, Ripple is a private company. XRP may be decentralized as a cryptocurrency, but it is still spearheaded by a private company. This is much different to other cryptocurrencies which are fully decentralized. To many investors who are used to traditional investments, this may be seen as a positive, but for crypto enthusiasts, it is often viewed as a negative.

Protecting Your Cryptocurrency

Cryptocurrency and the blockchain stand to be a major driving factor in the technology of the future. However this popularity has attracted an element of cybercrime. There are several tools internet users should use to increase their online protection. One of these tools is SaferNet.

SaferNet is the perfect solution to the cybersecurity issues that individuals, families, and businesses face today. It not only connects every device using a secure, 24/7 always on, military grade VPN, but it also stops outside cyberthreats, malware and viruses as well. On SaferNet, all users are protected anywhere in the world, all the time, on any cellular or Wi-Fi network. In addition to SaferNet’s VPN and cyber protection, it also offers a range of employee or parental/family internet controls including internet filtering, monitoring, scheduling, and blocking access to websites or even entire website categories

Typically, a user would need 3 separate services for a VPN, Malware Protection, and Internet Controls; SaferNet offers all 3 features in one service. SaferNet truly is an endpoint security presence that can be implemented in minutes around the world, on phones, laptops, tablets, and computers at an economical price point that caters to all internet users. SaferNet guarantees a smooth setup and installation process that takes only minutes, and an easily accessible control hub for you to monitor all your employee’s or family members devices; including activity, time spent online, and threats blocked.

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