Ripple is by far the most misunderstood coin in the crypto space at the moment. With lawsuits being thrown at the Ripple foundation by investors who claim that the foundation and the XRP are one and the same thing, to regulators taking a closer look to try and find out exactly what the XRP and Ripple is all about, we had to break it down for you just so you can understand what the XRP is all about.
Defining the Ripple
Well, for starters, Ripple is an iteration of RipplePay which is a real-time gross settlement system represented by the XRP protocol as a token or cryptocurrency. Ripple can serve as a currency exchange or a remittance network whereby the XRP is managed independently on a network that validates transaction from distributed servers that constantly update the network’s ledger with new transactions.
Unlike Bitcoin that depends on a proof of work concept to verify and add transactions to the Blockchain ledger, Ripple’s XRP network is not designed to rely on mining, intense computing resource or energy. Rather, the ripple is supported on a public database maintained by validating servers that can either be a bank or an individual.
Is ripple even a Blockchain?
Well, technically Ripple is not a Blockchain technology. Although most people assume that the XRP is run on a Blockchain network, Ripple actually uses HashTree which is a functional programming data structure that provides consensus to the ledger by comparing and validating the summarized data.
If Ripple is not a Blockchain why are banks into it?
Glad you asked. Well, as a standalone technology, the XRP is valuable to banks as a payment consensus mechanism. Even though the XRP can be used between individuals to settle payments instantly, it was never really designed to be a store of value like other cryptocurrencies such as Bitcoin. The Ripple XRP was originally designed to be a technology that moves money between banks and across borders quickly and at negligible fees.
The recent turn of events have pulled a lot of attention to the XRP, and the Ripple foundation here is an update. The SEC has been debating on the fate of cryptocurrencies that has further pushed the debate on whether the XRP is a securities token for the Ripple Company or just a standalone commodity. To this regard, Ripple (the company behind the XRP) has been prompt to address the confusion surrounding the true purpose of the XRP. Ripple has repeatedly distanced itself from the XRP despite being the main issuer of the XRP.
Separating XRP from Ripple
In fact, Ripple has initiated a campaign that will establish the XRP symbol with efforts from the XRP community to come up with a new logo for XRP. However, it still remains that a huge part of the crypto community is still confused by XRP and Ripple. Most cryptocurrency enthusiasts view the XRP as a centralized cryptocurrency that only severs the needs of banks. To this reason, most have shied away from investing in XRP with CNBC reporting how some early investors in the cryptocurrency space find the XRP unattractive.
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
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