Ever since the Bitcoin revolution, over 1700 cryptocurrencies have sprung up. Among the coins that are steadily gaining popularity with investors and merchants alike is XRP (Ripple). The sheer volume of the coins puts it at third position after Bitcoin and Ethereum in its market cap. At its peak, the numbers had skyrocketed on the Ripple Price Chart, and it was valued at USD 121 billion by the end of the first week of 2018. So here are some facts about Ripple you may not have known.
- Ripple’s official name is XRP
When you buy or send, your transaction is not exactly in Ripples, the actual name for the token is XRP. Ripple Labs is the parent organisation that came up with the XRP token. The token is part of RippleNet which is its digital network for a financial institution who process payments of customers across the globe.
It is important however to note that financial institutions don’t need to own the XRP currency to use the Ripple network. It is not mandatory to do the transactions using XRP, but Ripple recommends using XRP as it is the fastest way to send or receive money across their network.
- Low-cost payment system
Ripple’s primary goal is to facilitate financial transfers internationally as regular transfers are inefficient and time-consuming. Ripple’s transaction fee is much lesser at 1% compared to Bitcoin and Ethereum while being faster. It is also cheaper to transfer through Ripple than the standard bank-to-bank transfer. XRP, however, is not a payment currency; you cannot use it for online payments for goods and services. It is only designed as a transfer system to send money from one point to another across various locations around the globe. XRP can, however, be bought as an investment but not all cryptocurrency exchanges let you Buy XRP with Credit Card. In most of the exchanges, you will need other coins such as Bitcoin or Ethereum, but Ripple to Bitcoin Conversion is no longer the most popular trading pair as exchanges now also support trading with numerous other coins.
- Ripple Labs is the owner of the highest number of XRP
The total possible supply of XRP is about 100 billion, out of which Ripple Labs owns around 60% which gives it the highest stake in its cryptocurrency. Crypto advocates have pointed out that this centralises the control of XRP currency within the organisation and it’s not the same as the decentralised management seen in other coins.
- Ripple’s network is a lot faster than Bitcoin or Ethereum
Being set up as a fast payment method to transfer funds across borders, Ripple can transfer in a matter of seconds while Bitcoin can take up to 10 minutes to complete a single transaction. Ripple’s near instantaneous transaction time is a huge advantage for those who need to send large volumes in a short time.
- XRP cannot be mined
Unlike Bitcoin and other currencies that grow through mining, every XRP in existence has already been calculated. The currency has a limit of about 100 billion tokens, and only about 40% of them are in circulation right now. Ripple Labs own 60 billion, and they keep 55 billion of the tokens in escrow accounts for later use.