In grammar, ripple and ripple price refers to an effect or feeling that is passed from one person to another. More like an infectious feeling. This definitions is quite relevant in describing Ripple, the cryptocurrency solution.
Ripple coin (XRP) is a decentralized cryptocurrency solution that is tailored towards offering all rounded financial solutions with a bias towards banking solutions. XRP is one of the top four cryptocurrency solutions in a pool that also includes Bitcoins (BTC), Ethereum (ETH) and Litecoin (LTC). The ripple price model is one of the most stable making it one the choicest cryptocurrency solutions for both hedgers and heavy users.
The company behind Ripple
Ripple was formulated and ported in 2012 by OpenCoin company under the direction of Chris McLarsen (CEO) and Jed McCaleb (CTO). Before going live the ripple was passed on to OpenSource’s subsidiary under the name Ripple for ease of management. As from 2013, OpenCoin dropped that name in favor of the name Ripple Labs LLC
Ripple Price Protocol
XRP runs on a modular structure known as the Ripple Protocol (RXTP). This protocol is what the blockchain network is to Bitcoins. The protocol is built with the same cryptocurrency idea of decentralization at its core.
The chief difference from Bitcoins’ blockchain model is that RXTP is built with speed, security, and scalability in mind. With these features in tow, it has been able to attract so many partnerships. Some of these partnerships include major leading banks such as Standard Chartered, Unicredit Group, UBS among others. Ripple protocol lends its features to XRP making it the banker’s choice for cryptocurrencies. As such even banks have shown interest in using XRP. This sign of confidence has helped boost ripple price.
All transactions passing through the protocol are recorded on a ledger. More like the blockchain ledger in Bitcoins. The ledger is distributed across various institutional and individually owned servers. These set of servers form what is known as a consensus network. The servers act as validators of transactions by inspecting the legitimacy of each transaction.
XRP’s basic structure
For ripple price, XRP can be denominated in a number of fiat (physical) currencies such as the dollar. It can also be denominated against other cryptocurrencies such as the BTC. XRP’s smallest unit is known as a drop which is 0.000001 of a single ripple coin. This means that it takes 1 million drops to make a single unit of XRP.
Ripple token is fully reliant on the secured RXTP protocol. In the interest of security and enhancing transaction speed, XRP is not mined like ETH, BTC or LTC. Instead, it relies on market makers to arbitrage on the supply, demand and the ripple price.
What is market making?
Although it might seem like a hard term, market making is an easy concept to grasp. XRP is largely a currency exchange coin. A pool of traders who work on creating their own ripple price model is required to actualize these transactions. These are the market makers. In return, they earn from the spread. Due to the fact that they are in competition with each other, they help keep the exchange prices low while providing an accessible pool for fast transactions. The spread resulting from these market-making activities is a large component of the ripple price. Ripple’s open protocol allows anyone with the ability to do so, to participate in market making.
XRP’s unique distribution technique
Problems with scalability is a subject that both Bitcoins and Ethereum are duly accused of. To stymie this disadvantage, XRP has been distributed coins on an ingenious automatic piecemeal basis. The initial coins created for distribution were 100 billion coins. Of the initial coins created 20% were retained by the creators.By June 2017, the creators had issued half of their holding to charitable and educational initiatives with the aim of enriching XRP’s injection within the society.
As of September 2017, a total of 38 billion were openly being traded. Ripple Labs still holds 55 billion coins which are held in a secure crypto-locked escrow account. Each month 1 billion tokens are released for trade purposes. At the end of the month, the untraded coins are returned back to the escrow upon which a new cache of 1 billion XRPs are released for trade. This enhances trade while supporting the growth of the ledger trades in the foreseeable future.
Difference from other major cryptocurrencies
According to Ripple labs, XRP is meant to be a complementary currency to other cryptocurrencies rather than a rival. At the heart of the cryptocurrency discussions, Ripple is a challenger to other cryptocurrencies. The following are reasons for users to choose Ripple over other cryptocurrencies
• Versatility: In comparison to Bitcoins and Ethereum it offers more versatility due to its open network.
• Cost factor: Its low price means that almost anyone can participate in its use making it �the general populace’ cryptocurrency.
• Stability and security: XRP is far more secure and stable than both ETH and BTC. In all its existence it has not faced any
successful breaches or downtime.
• Transaction speeds: It is by far the fastest of all the leading cryptocurrencies with confirmation time of as little as 8 seconds. This means that it is able to conduct multiple transactions per minute.
• Price stability: The average ripple price has remained marginally consistent over a long period. This lack of volatile movement in ripple price makes it a good choice for use in day to day transaction as well as an exchange module.
How are XRPs bought?
XRPs is available for purchase from leading cryptocurrency exchanges such as Changelly. These cryptocurrency exchanges have ripple price bases in both fiat and cryptocurrencies.
Ripple continues to offer new solutions on various fronts. It is these base solutions that predominate its usage.
• Purchase and sale of goods: Though not its main purpose, ripple tokens have found use in enabling trade of goods and services. You can exchange ripple coins for other currencies and use those currencies for purchases. XRPs are also used in the purchase of precious metal values (and actual precious metals) like gold silver and diamond.
• Forex exchange module: Underlying the use of XRP is the fast transaction rate which makes it a good option for forex exchanges. Supporting this use is the wide pool of market makers.
• Cross-border payments: Given its first transaction capabilities and secure protocol it is becoming the best alternative for cross-border payments. Working hand in hand with other providers such as Western Union money transfer service it will most likely be the ultimate crypto money remittance service.
• Bridge currency: XRP offers a gateway for accessing, not only other fiat currencies but also other cryptocurrencies. That is why ripple price is denominated in multiple currencies and precious metals.
In a nutshell, a stable ripple price backed by a secure network, scalability, and versatility make XRP the cryptocurrency to look forward to. Just like water ripples, the RXTP and XRP use continue spreading supported by the legitimacy of their use.