What is Ripple - XRP?

in #ripple7 years ago (edited)

Ripple_logo.svg-1.png

Ripple is a digital currency and open-source protocol for making payments over the Internet. Of all the creptographic and digital currencies, Ripple is a little conspicuous. Some say it stands out for the worse.
Bitcoin, the first of the digital coins and many other coins all share a common ideology. Their basic approach is anti-establishment, one that aims to free the masses from the bonds of governments and central banks and to grant humanity free and decentralized currencies, free from censorship and boycotts and which are not controlled by any body, government or person. But Ripple ... He came to do business.

The body behind Ripple and responsible for its development is a profit-making business called Ripple Labs, which aims to create a decentralized payment system and integrate it into the existing financial system. Ripple aims to create cooperation with the banks. Do not replace them.

This has made Ripple an unpopular coin among the various digital coin communities, and there are many who claim that Rieffel is not a decentralized digital currency but rather a centralized system. By the way, if we want to be precise, then Ripple is not the currency - it is the protocol.
The currency sitting on the RIP protocol is called XRP and is the one that trades in the trading and variance domains and from which the value of the network is derived. We will elaborate on it later.

On Ripple's website, the company boasts that the Ripple network is currently the only solution in the world that provides global payments service to businesses by harnessing the power of the Blockkin. According to them, in a world where over 3 billion people are connected via the Internet, cars are driving themselves and applications are talking to each other, the global payment system is still stuck in the age of disco.
Breefel touches on the main weaknesses of the existing banking system, noting mainly the long transfer time (3-5 days for the transfer) and the high commissions ($ 1.6 trillion per year).
Ripple's solution is a distributed authentication and transfer network that uses digital tokens to perform transfers of any trading unit. From the US dollar, Euro and yen, to goods of the kind and even frequent flyer points. Network transfers are carried out almost immediately, enabling fast tracking and tracking of transactions on the network, and offering extremely low fees. As of this time, Ripel has over 90 business customers worldwide, including payment providers, trading platforms and large and well-known commercial banks such as Santandar, UniCredit and UBS.

stee.jpg

Ripple's protocol development sources were started in 2004 by software engineer Ryan Fugger while he was working for a digital trading company in Vancouver, whose original intention was to create a decentralized monetary system where individuals or communities could create their own money, inspired by Fugger's product years later , A man named Jed McCaleb, in collaboration with a number of other developers, developed and built a digital payment system that operates on a mechanism of verification by means of a consensus between its members (as opposed to the Bitcoin network mechanism) using blockachine technology to attack the weak spots of the bitcoin , High electricity costs in the production process and speed The result is the Ripple protocol.

In essence, Ripple allows immediate and direct transfer of funds between two parties. As such the protocol allows to overcome two of the outstanding shortcomings of the banking system today, commissions and long waiting time.
On the protocol, you can trade with ticks in any type of fiat currency or commodity between two parties who trust each other. If a direct trust relationship between a sending party and a receiving party is not found, the network will seek indirect trust relationships between the parties through other members of the network. In order to secure the veracity and veracity of transactions on the network, Ripel has developed a consensus-verification mechanism that is implemented by a "network of independent servers constantly engaged in benchmarking transaction registration in Blockchain."

stee.jpg
XRP

On the Ripple protocol, the company created an internal currency called XRP, similar in its basic properties to Bitcoin. XRP is designed to help financial institutions to transfer funds and provide liquidity quickly and inexpensively over the network. The data presented on the company's website shows several advantages that XRP holds over its digital competitors and the traditional system. According to the company, the approval time for XRP transactions is only 4 seconds! This compares with 2 minutes in the Atrium and slightly over an hour in Bitcoin. (For Bitcoin, the transaction approval times vary according to the request of the receiving party in the transfer)
In terms of Scalability, the ability of the network to grow and process large volume transactions, it was noted that while Bitcoin is capable of processing 3-6 transactions per second and 15 transactions per second, XRP currently processes 1,500 transactions per second and has the maximum capacity equivalent to that of the Visa network 50,000 transactions per second, as of July 2017). Riffel is also proud of its reputation for 5 years of flawless activity, a team of engineers, and negligible energy consumption to operate the network.

In the first months of 2017, the Ripple chain experienced an astonishing explosion in its value when the price of a single XRP currency shot up from 6 to 40 cents. An increase of more than 70 times its value. Bringing the total value of the network from $ 200 million to about $ 16 billion at its peak.

To a potential investor who believes that the future of digital currencies is rather a partner to the banking system rather than an enemy, Ripel is certainly an interesting opportunity. But there is one serious problem that may affect XRP's increase in value in the future. Supply side.

Unlike the Bitcoin, where new coins are created and entered into the cycle through a gradual mining process, all the currencies that have ever been created have been created by Ripple Labs.There are currently only 38 billion free coins to trade in the markets out of a total of 100 billion coins .

And where else do you ask? Is safely owned by the Company and sold to potential buyers through an orderly distribution process managed and executed by Ripple Labs itself. Moreover, some 20 billion coins were distributed directly to the founders of Ripple and the remainder was handed over to the company.
It is not difficult to understand the problem with the currency distribution and investors' fear of the market being flooded and the future devaluation of the currency.

Ripple Labs is certainly aware of the problems and investors' concerns and therefore took a confidence-building step in May 2017. The company announced that it would lock in 55 smart contracts totaling 55 billion XRP coins by the end of 2017 (about 90% of the existing reserves). Each month, one contract will be opened and released to the Company About one billion XRP coins to be distributed in the markets. The balance that the company did not sell each month requires Ripple to lock in a smart contract for another 55 months, and so forth. In the past 18 months, the company has sold to investors an average of 300,000,000 XRP coins each month. In doing so, he hopes to reassure the market of a future XRP forecast and give investors a clear picture of the continued currency distribution.
By the way, it is reasonable to assume that the meteoric rise in value of the currency at the beginning of 2017 was due to the move planned by the company, which leaked to sophisticated traders who rushed to seize the opportunity.

stee.jpg

In conclusion, XRP (and the Ripple Protocol) is certainly a different and controversial coin in the digital currency landscape. However, it is precisely this difference and the fact that it is managed centrally by a business company with extensive experience and first-class business people that will continue to lead the currency to increases and increasing popularity among banks and other business entities. Despite the sharp price hikes in the past year, the currency is still an investment opportunity, and it is reasonable to assume that its competitors will not be stagnant and are already working on developments and innovations based on Blockchine, as well as the fact that the existing system and infrastructure is deeply rooted in banks Many years and probably have a long and cumbersome process to replace him.

up.gif

Sort:  

Very informative. It is sad how stupid meme posts here on steemit get 200+ votes, while posts like yours are buried in the blockchain, unnoticed.

Coin Marketplace

STEEM 0.20
TRX 0.14
JST 0.030
BTC 67364.26
ETH 3322.90
USDT 1.00
SBD 2.71