XRP (Ripple): The Gateway Crypto

XRP is a gateway crypto; the first one isn't free, but once you have tried it, you want to have more! Let me explain why I am in for the long haul with XRP.

Basic Idea Behind XRP

First off lets clear something up; XRP is the name of the currency and Ripple is the name of the company behind the currency. They are colloquially used interchangeably, but this is the fact of the matter.

The idea behind XRP is to facilitate the movement of fiat from one place to another quickly and cheaply. One of the biggest hangups in sending currency in any form across borders is the time it takes and the cost of doing so. Ripple has lain the groundwork for a system that will allow banks and other financial institutions to be able to transfer value or wealth from one geographic location to another instantly and hassle free. This fintech is designed to help facilitate the movement of fiat inside of the current system quickly and cheaply compared to the current system that could take days and cost hundreds. XRP can handle 1500 transactions per second which puts it ahead of PayPal and VISA in speed and blows Bitcoin out of the water which can only handle 20 transactions per second!

Partners, so far...

As of this writing, Ripple has partnered with about 200 companies across the world to utilized some form of their infrastructure. Adoption varies from company to company; some have adopted the full suite and others have adapted portions of the protocol to help facilitate their current business models. Either way, this is an incredible feat for a relatively new company in a relatively new industry. They have landed some big names such as MoneyGram, American Express, Mastercard and Banco Santander. The last of which, for my American followers, is a major bank in Europe. I first became aware of them because of their sponsorship of Formula 1 racing. One can infer that the technology and protocols that Ripple is developing is pretty solid to land all these partnerships, especially these big names.

Decentralized or not? Crypto or not?

One of the biggest arguments about XRP pretty much whenever it is brought up is whether or not it qualifies as a cryptocurrency. Ripple is a company that has been around since 2013 and it has a more traditional corporate setup compared to other projects in the crypto space. The infrastructure is controlled by the company and the core code is not public, but the XRP Ledger is open source. These facts have lead to the debate on whether the nature and organization of Ripple/XRP is decentralized enough to be called a cryptocurrency.

Why I am a big fan

What some people may say are the disadvantages of XRP and Ripple I say are advantages. Are they as decentralized as other cryptos? No, but this is one of the reasons XRP is a gateway crypto. XRP is centralized enough to make financial institutions feel comfortable adopting their protocols, yet they utilize all the hallmark technology of cryptocurrencies. This has the advantage of having the institutions being exposed to blockchain technology while mitigating some of banks' perceived risk in a totally decentralized atmosphere. With the successful use of Ripple's infrastructure over time by major financial players, it may lead to more generalized use and adoption of other cryptocurrencies within the financial sector. Also with their name being associated with household names, that will lead to more exposure to the general populace and people vote with their feet so to speak. Once they start seeing the Ripple/XRP name associated with companies, they will flock to those companies. When the companies that utilizing Ripple/XRP or blockchain in general become more profitable, it will lead to more widespread adoption. The fact that they have landed a contract with a major financial institution in China is huge as well. That is a traditionally closed society and providing a service to potentially 1.3 billion people I would assume would only help.

I believe that in 50 years when historians look back at the crypto revolution they are going to include XRP as one of the founding fathers of the movement; Bitcoin paved the way, Litecoin was the first gen improvement, Ethereum was the first viable alternative and XRP brought crypto to the masses.

Thanks for reading! Please leave your comments below. Whether you agree or not, a lot can be learned from a good conservation!