What is Ripple?
Ripple was originally created in 2012 and co-founded by Chris Larsen and Jed McCaleb. It is an online payment platform within the Ripple currency (XPR) is transferred. The coin for this cryptocurrency is labeled XPR. This digital currency works on an open source and peer-to-peer decentralized system. Ripple works on the public database that processes between those validating servers to ensure security. These validating servers belong to anyone, from bank to individuals.
The ripple’s main aim is to transfer money between two parties. You can exchange any type of currency. You can save fees and wait times for traditional banking transactions.
OpenCoin, the company behind ripple, stated that the currency addresses the need to keep money flowing freely. Ripple has been steady since its release with over more than 35 million transactions processes without any problem.
How does Ripple Work?
Take a look at this scenario
James and Alice need to transfer some money to each other. James uses Bangladeshi taka (BTD) for his business, while Alice operates in Jamaican dollars (JMD).
The process of James sending money to Alice involves converting the Bangladeshi Taka (BTD) to a common currency like USD, after that transferring the money between their banks. Finally, the USD in Alice’s bank is converted back to Jamaican dollars.
This takes a lot of fees at each and every exchange and total waste of time. So, what to do? Enter The Ripple.
The Ripple process is using XRP as a common currency for all the money transactions between different currencies. For converting one currency to another XPR and back, the transaction fees are very lower, and transfers take only 4 seconds to execute and verify. That’s insanely fast!
Many global banks already adopted Ripple as it saves them a lot of money by avoiding exchange fees.
How is Ripple different from bitcoin?
The Ripple network works slightly different than bitcoin. A decentralized system like bitcoin is not owned by any bank, government, or any third party despite being initiated by someone. On the other hand, Ripple is owned by the company with the same name.
There are many different other than this, let’s summarize them.
Different Mining Process
Bitcoins are only generated through mining by users. On the other hand, Ripple creators have already set the limits by creating 100 billion Ripples.
The Blockchain process requires mining. That is why Bitcoin transactions usually take time to authorize. But Ripple transactions take only 4 seconds to authorize, that’s why Ripple is faster than Bitcoin.
In order to buy or sell Bitcoin, the user has to utilize the centralized exchange, which can probably crash. With Ripple, you can buy/sell XPR on its own secure network.
Ripple keeps track of information, such as account balance. On the other hand, Bitcoin can only track the movement of Bitcoin.
Do you know something about Ripple? Share with us in the comment section.