- XRP is the native coin of Ripple, which was launched in 2011 by Jed McCaleb and Chris Larsen.
- XRP is a pre-mined cryptocurrency with a total quantity of 100 billion units.
- XRP is less expensive, has faster transaction times, and uses less energy than Bitcoin.
XRP is a cryptocurrency and token that Ripple Labs uses to conduct transactions on its network. XRP primarily facilitates global financial transfers and currency conversion. Investors utilize it to store value and profit from price swings.
Let’s get deep into it.
The History of XRP
Ripple, a centralized fintech company, was initially founded as Ripplepay in 2004 by Ryan Fugger, predating the emergence of Bitcoin. In 2012, Chris Larsen and Jed McCaleb co-founded Ripple, aiming to provide a more efficient, secure global payment solution similar to Bitcoin’s vision by Satoshi Nakamoto. Unlike Bitcoin, Ripplepay was not blockchain-based; it was centralized.
Recognizing the limitations of Bitcoin, McCaleb, David Schwartz, and Arthur Britto began developing the XRP ledger in 2011. When launched in 2012, the XRP ledger introduced the native token XRP to enhance its functionality. Larsen, who later became Ripple’s executive chairman and co-founder, joined this engineering team.
Ripple underwent several name changes between 2012 and 2015. Initially known as Newcoin in 2012, it was rebranded as OpenCoin in 2013. Finally, in 2015, it adopted the name Ripple, which is now widely recognized.
Ripple and XRP
While XRP is commonly associated with Ripple, it’s crucial to clarify that XRP is an independent open-source digital asset separate from Ripple, a technology company. Ripple utilizes XRP in its solutions to assist customers in achieving compliance, leveraging XRP’s attributes, including speed, efficiency, reliability, and environmental friendliness.
XRP operates on its decentralized open-source blockchain, the XRP ledger (XRPL), and transactions are facilitated through the Ripple transaction protocol (RTXP). In contrast to most cryptocurrencies, XRP is pre-mined, with a maximum token supply of 100 billion. The distribution of XRP tokens occurred in three primary ways:
- Initially, 80 billion XRP tokens were allocated to Ripple, the parent company. To ensure a stable XRP supply, 55 billion tokens were placed in an escrow account.
- The remaining 20 billion XRP was distributed among Ripple co-founders and the core team.
- The remaining XRP tokens are gradually released, with an original release schedule spanning 55 months and distributing less than 1 billion per month.
XRP’s core concept was to establish a peer-to-peer trust network. Ripple positions XRP as a swifter, more cost-effective, and energy-efficient digital asset capable of processing transactions in seconds while consuming less energy than some peer cryptocurrencies.
XRP is typically built as a settlement layer, facilitating transactions using the Ripple network. It has been traded as a cryptocurrency and can be found on various platforms, including futures, options, swap, spot, custodian, and non-custodian exchanges.
How Secure Is XRP?
The Ripple network, utilizing XRP, employs a consensus protocol to validate transactions. Validators within the network update their ledgers at intervals of approximately three to five seconds, incorporating new transactions while ensuring synchronization with other ledgers. This approach enhances the security and efficiency of transaction validation compared to many other cryptocurrencies.
Where Can You Buy XRP?
Several specific exchanges offer the opportunity to buy XRP, allowing users to purchase using fiat or other cryptocurrencies. Notable exchanges that currently facilitate the sale of XRP include Binance, BTCEX, Bybit, Deepcoin, and MEXC, among others, providing accessible avenues for XRP investment.
Is Investing in XRP a Smart Decision?
Whether investing in XRP is prudent depends on your risk tolerance, market perspective, and ability to bear potential losses. It’s advisable to seek guidance from a financial advisor or investment expert before purchasing XRP or engaging in any investment.
Despite its multiple problems, XRP maintains a prominent market capitalization position among cryptocurrencies. It can be used for transactions or as an investment, like any other digital currency.