XRP

Ripple is the US-based company behind the XRP Ledger – an open-source, decentralized blockchain. XRP is the cryptocurrency that runs on the XRP Ledger.

XRP For Fast Payments

Ripple created XRP to be a faster and cheaper alternative to global payment systems like SWIFT. XRP takes seconds to transfer, which means you could send money to anyone in the world instantly. All you and the other person needs is an XRP wallet. Fees are virtually nothing, set at 0.00001 XRP.

Ripple has largely been aiming for XRP to become the digital currency of banks and financial institutions. Ripple would like to see all financial institutions drop current money transfer systems and use XRP instead. This would allow for fast and cheap money transfers globally, with the added security of a blockchain.

Ripple Controversies

Ripple has had legal issues with the SEC who has claimed that XRP is a security because it is pre-mined.

Pre-mined means that all of the XRP that will ever be available already exists. This means the SEC thinks XRP is similar to a stock released by a company. The company creates 500 shares and then releases them. Ripple creates 100 billion coins and then releases them slowly over time.

A cryptocurrency like bitcoin is not a security because it is not pre-mined. Around 18 million out of a maximum of 21 million bitcoin are currently in existence. The rest are yet to be mined.

With XRP pre-mined, it means that Ripple keeps most of the XRP in reserve. Some people worry that Ripple could release too many coins into the market at once, effectively diluting the price.

There are also concerns about XRP being too centralized. This is because Ripple has a default list of validators to verify transactions. Ripple itself runs validators for the XRP Ledger.