Ripple was created in 2013 by a private company.
Its goal is to serve as a complement to the traditional means of payment used by large financial institutions, such as SWIFT.
Ripple is currently ranked #7 in the crypto market by market capitalization.
CoinMarketCap lists more than 7,000 cryptocurrencies, each one different from the other, with unlimited variables of the blockchain technology introduced to the world by Bitcoin in 2008.
Among these thousands of digital asset options we find Ripple (XRP), another cryptocurrency class very different from BTC. This cryptocurrency was created by a private company to serve as the basis of its business, so we are in the presence of a centralized crypto and a private blockchain.
XRP is currently the seventh largest cryptocurrency in the crypto market, with a capitalization of over $11 billion, behind only Bitcoin (BTC), Ethereum (ETH) and the stablecoin Tether (USDT).
What is XRP?
Ripple Labs was founded in 2012 in San Francisco by Chris Larsen, Jed McCaleb, David Schwartz and Stefan Thomas. The project was first called Opencoin and then renamed Ripple in 2015.
In 2013 the company created its digital asset Ripple or XRP, which aims to serve as a complement to the traditional means of payment used by large financial institutions, such as SWIFT.
These international transactions between banks and financial institutions are extremely common in our daily lives. However, they have a fundamental problem, they are very costly in money and above all in time.
Today's world moves at the speed of light, so transaction times of days and the high costs of service providers like SWIFT are a big problem in a world that has no time to waste. So the Ripple team set out with the goal of migrating these transactions from traditional channels that occur between centralized databases, to a variant of blockchain and cryptocurrency technology.
With this, Ripple has managed through the use of its cryptocurrency, XRP, to reduce these transaction times from days to minutes, and costs from thousands or millions to just a few cents of dollars, specifically USD $0.00001 on average per transaction.
According to the company behind XRP, its cryptocurrency is:
"A digital asset created for payments. It is the native token of `XRP Ledger', which is a decentralized, permissionless, open source Blockchain that can perform any transaction in 3 - 5 seconds."
XRP Features
Pre-mined: Unlike Bitcoin where the only way to create new cryptocurrencies is through mining. In the case of XRP as there is no mining process as in BTC, the developers decided to create all the XRP at the beginning of the project, and the magic number is 100 billion XRP. Which were distributed 20% to the public in prizes and releases and 80% to Ripple, the company behind the project.
Federated Byzantine Agreement (FBA): This is XRP's consensus method, and unlike Bitcoin's PoW, it does not reward miners for their work.
It is environmentally friendly: Unlike many of the other cryptocurrencies, XRP does not need computing power to secure the network, nor to compete between miners. So its carbon footprint is minimal.
A decreasing number of XRP: 100 billion XRP were created at the beginning, but, each time a new transaction is made, the cost in XRP of each one is removed from the network. This is intended to make the price of XRP anti-inflationary over time.
A centralized blockchain: Although the Ripple team says that the XRP blockchain is not controlled by them, and that it works autonomously. It is the company itself that guarantees the security of XRP, thanks to the maintenance and new developments to the blockchain. They also control approximately 80% of all XRP created.
How does XRP work?
Unlike cryptocurrencies that use the Proof of Work (PoW) consensus method, such as Bitcoin (BTC), which allows any miner to contribute computational power to validate transactions, and also allows these miners to compete with each other to validate the same transactions and blocks faster, XRP grants centralized computational power only to participants previously approved by the network.
The technology used by Ripple goes by the name of XRP Ledger, where "validation nodes" collect information on all candidate transactions and reach a consensus on whether to validate and include in the blockchain these transactions without the need to consume large amounts of energy and time in the process.
Once 80% of the validation nodes agree on the set of transactions, they are executed in order of arrival depending on the time the user started the transaction. Once completed, the process occurs again. All these steps take 3 to 5 seconds according to the Ripple team.
This type of consensus algorithm is called Federated Byzantine Agreement (FBA), which in turn is based on the Ripple Protocol Consensus Algorithm (RPCA). Unlike the other methods such as Bitcoin's PoW or PoS, it does not reward its miners every time they successfully validate a block.
This method aims to eliminate network incentives to accumulate more and more computing power, which in turn consumes more energy to the detriment of the environment, and finally avoids the centralization of the network in a few large miners. Such as is currently happening in the Bitcoin Blockchain.
The FBA allows the XRP network to validate more than 1500 transactions per second, against the 7 that Bitcoin can validate. Which makes it one of the fastest crypto in the ecosystem, and even surpassing PayPal in the traditional world.
source:HowMuch.net
XRP use cases
Unlike Bitcoin which was created in part to serve as a payment method for individuals. XRP was created to serve as a complement and vehicle for Ripple's objectives. Primarily for banks and banking institutions to solve certain problems, such as the lack of liquidity among certain fiat currencies, long interbank transaction times, and high costs.
Instant liquidity of fiat currencies: There are many fiat currencies that cannot be converted into each other in the Forex markets, as there are no such trading pairs. So banks and institutions must use the US dollar as a base pair to generate two transactions, one from currency A to USD and from USD to currency B. So there is a double commission and a double waiting time. With the use of XRP this is eliminated, as the base pair will be XRP, with which Ripple can generate instant liquidity, or at least this is what its team assures.
Instant interbank transactions: Banks currently transfer billions daily to each other, which generates high sunk costs in their business system. Ripple, thanks to the use of XRP, has managed to reduce these costs to a few dollars. But this is not all, as these transfers generated by traditional means can take up to days, generating even more costs to banks.
Today more than 400 financial institutions in more than 60 countries are using Ripple and its solutions to solve some of these problems. Banks such as: Banco Santander, Westpac, Union Credit and UBS are just some of them that are using Ripple's solutions.
well I hope you liked the information presented here for the next I will be more tokens and cryptocurrencies with their respective information have a great day here pandoru1997 goodbye...
You may be interested:
the best 11 graphics cards in my opinion
have a great day...