Ripple can be defined as a real time gross settlement or RTGS system. It is popularly referred to as the Ripple Protocol or the Ripple Transactions Protocol. It has been built using a consensus ledger, a distributed open source internet protocol and a cryptocurrency named XRP or ripples. According to the experts at https://ripple.com/, ripple offers its users the chance to conduct global transactions instantly and with no chargebacks. The relation between the three major cryptocurrencies namely, Ripple, Bitcoins and Ethereum, can be found at themarketmogul.com/ripple-bitcoin-ethereum/.
Since XRP has been created for the Ripple network, it can exist solely within this system only. The XRP can be divided up to six decimal places. The smallest unit of the XRP is called a drop. One million drops is equivalent to one XRP. During the inception of XRP, only a hundred billion XRPs were created. This was done to ensure that remained a scarce resource to increase its value. In order for any user to use a Ripple account, they need to have at least 20 XRP in their account. When Ripple started, it had huge funding of over forty two million dollars as Venture Capital. Plenty of big financial whizzes like Google Ventures, Andreessen Horowitz and Santander invested in Ripple. However, more money venture capital will be added soon, since startups require more than one round of funding to reach the finishing line.
Cryptocurrency like XRP and Bitcoins offers no counterparty risk which makes it quite popular among investors. The risk that each party that is a part of the contract does not follow the contractual obligations is known as counterparty risk. It is also referred to as default risk. With cryptocurrency taking away this risk, contracts become stronger.
Although Bitcoin relies on mining, XRP does not work that way. This makes it a far easier way to secure the network and also offers the users a faster transaction confirmation. XRP differs from Bitcoin by being a network for global settlement for other currencies like bitcoin, dollars, pounds, euro and even frequent flyer miles. However, using this particular feature requires the users to pay a fee in Ripples.
XRP is often compared to Bitcoin as another cryptocurrency. However, XRP offers plenty of other features which makes it unique in its own way. It works as a middle person for several kinds of global transactions. It also offers faster transaction confirmations making deals go faster. With each transaction taking less than four seconds, banks are interested in using the speed and the security XRP offers. Since the network has already been implemented in Chinese banks and been able to withstand several kinds of attacks, the rest of the world has started to realize the advantages of shifting to the Ripple network in the near future. With the increasing support of Ripple, it will soon be more than just another cryptocurrency in the world. It has already created a strong foothold and offers a bright future to the users who are smart enough to shift to the Ripple network as soon as possible.