Ripple is well-known among cryptocurrency enthusiasts. It is a digital payment system used for monetary operations.
With Bitcoin’s popularity, several other cryptocurrencies started their operations. Ripple is just one of them and is part of the Altcoin league. It first appeared in circulation in 2012.
Ripple is primarily used in payment settlement, asset exchange, and remittance systems. It works very much like SWIFT, a system used by banks and other financial institutions to transfer money and securities.
The ripple cryptocurrency coin is denoted by the symbol XRP. So, buying XRP is a way of investing in ripple.
What Is Ripple Used For?
Ripple is used both as a platform for peer-to-peer currency transfers (RippleNet) and a digital currency. The platform is an open-source protocol designed to allow quick and inexpensive transactions between two parties.
On the platform, you can exchange any type of currency, from fiat currencies like sterling to cryptocurrencies and air miles.
Ripple software can be used to exchange assets by both banks and individuals.
Currently, this is accomplished through the use of Swift, a system that requires banks to maintain separate accounts in each of the countries in which they operate.
Ripple provides a replacement with some advantages. For instance, it could provide low-cost currency exchange.
At the moment, many currencies cannot be converted directly to another, as such banks must use US dollars as the financial intermediary. As a result, there is a double commission.
Ripple can be used as a mediator currency, however, it is significantly less expensive than USD.
It also provides much faster international monetary transactions than other comparable alternatives.
The average time of the transaction on the ripple platform is four seconds, compared to around 10 minutes for bitcoin or several days for conventional banking systems.
Does Ripple Utilize Blockchain Technology?
Unlike Bitcoin, Ripple does not utilize blockchain technology. Miners validate bitcoin transactions before adding them to the existing blockchain.
Ripple, like Bitcoin, employs verification and validation servers and a consensus mechanism, but it does so through its technology platform, the ripple protocol consensus algorithm (RPCA).
The word ‘consensus’ in the name reflects the fact that if each node agrees with others, it will be reviewed and validated.
Is XRP A Good Investment?
Investor sentiment can shift in a financial market, and the cryptocurrency market does just that. Investors have nothing or less to lose, and dollars can go further in each crypto investment than they did at the peak of the market.
Tossing a few hundred dollars at a coin they like or at a business they believe in is less risky, however, there is still a possibility of losing money if the chosen investment does not increase in value.
XRP has earned the trust of financial institutions as well as investors, making it a more reliable and stable investment than other alt-coins. Therefore, buying XRP is quite a good investment.
Furthermore, compared to other cryptocurrencies where coins are continuously mined or created, ripple has a predefined number of coins.
Ripple distributes all XRP tokens on a predetermined timeline. However, the cap is a whopping 100 billion, of which only half are available on the market.
Ripple’s potential for growth, functionality as a cross-platform means of payment, and low entry point may entice investors looking to purchase the market sales.
What Factors Influence The Price Of Ripple?
The price of ripple is influenced by various factors such as:
What distinguishes Ripple from other cryptocurrencies is its underlying technology as a channel for international transactions.
So many large banks have publicly stated that they are testing ripple’s technology, which may adversely impact its price over time.
Governments as well as central banks do not currently regulate many cryptocurrencies. If this happens to change in the coming years, it may affect the worth of ripple.
Positive media coverage and interest in ripple’s technology are expected to have a positive impact on its value.
Conclusion – What Can Ripple(XRP) Be Used For?
Ripple is a cross-platform means of exchange and payment for any digital asset or currency. Its worth is in the network and its ability to quickly transfer assets around the world.
Rather than serving as an alternative for conventional methods of payment or a major competitor to fiat or digital currencies, as other cryptocurrencies like bitcoin seek to do, it can expedite a wide range of transfers across RippleNet.
The use of the XRP coin, on the other hand, is not dependent on the ripple network. So, buying XRP may be a good option if you are looking for the cheapest way to start investing in cryptocurrency.
Always be prepared as the coin could spike or sharply dip. You can either risk it by purchasing XRP while its close to a one-year low, or you can wait for a better deal later.
Since the factors that causes the rest of the crypto market to fall are likely to affect XRP soon, you can decide to buy XRP if you’re prepared to keep it during the varying tides and can risk losing some or all of your investment.
Ripple is available for purchase on many of the world’s best cryptocurrency exchanges, including Anycoin Direct, Binance, Kraken, and Coinbase.