Ripple is known for its crypto token XRP and peer-to-peer payment network RippleNet. It is a centralized network—its parent company Ripple Labs gains full control over 100 billion pre-mined XRP. XRP can connect two different fiat currencies during international transactions; RippleNet is a network of financial institutions that use XRP to transfer value anywhere in the world.
The transfer of assets must follow the Ripple transaction protocol by default. Every Ripple transaction is verified by the Ripple Protocol consensus algorithm.
Ripple’s Promising Future?
The explosive increase in Ripple’s value since the Bitcoin bubble of 2017 is the reason why we are talking about Ripple’s fate. Its innovative technology attracted millions in venture capital and got the backing of many financial giants. Here’s why:
1. Cheaper Cryptocurrency
The massive 100 billion XRP token availability, with over 50 billion in circulation, leads to Ripple’s price being lower than most cryptos—other cryptocurrencies have to be traded for over hundreds of dollars, but anyone can buy a Ripple token for less than $1. This unbelievably low denomination makes it accessible to all.
2. The Future of Banking
Ripple aims to disrupt the traditional banking system and payment processing industry. The RippleNet network acts as an exchange service for currencies and commodities and facilitates instant settlements of remittances globally at a nominal cost.
3. Supply—and Time
Ripple Labs has a fixed stock of 100 billion XRP. Ripple Labs retains 60% of the total XRP supply and plans to release almost 55 billion XRP, giving investors enough opportunity to invest and trade with it.
4. Increasing Adoption
By embracing XRP and RippleNet, financial institutions can save money with faster cost-effective payment processing. This step will increase Ripple’s adoption by banks and payment processors, causing a rise in its value.
5. On-Demand Liquidity
RippleNet’s On-Demand Liquidity service eliminates the pre-funding requirements for financial institutions and enables them to leverage XRP for international fund transfers.
6. Profitable in the Long Run
Ripple’s alliance with leading financial services providers and the small availability of tokens and cheaper rates would enable investors to prosper in the long run.
Ripple peaked at $3.84 in 2018 and then went down. Since then, Ripple has been struggling to keep up with Bitcoin; investors started to invest in cryptocurrencies showing signs of recovery. It forced Ripple to change its strategy. In an unprecedented move, Ripple announced to stop selling XRP tokens into the open market and bought $46 million worth XRP in 2020.
XRP sold by small investors were accumulated by big investors to protect their long-term positions. Ripple Labs targeted these big investors and bought back XRP in bulk to support the market. The company believes that selling down the rally would spur growth in demand for the coin, leading to a price increase.
Ripple also plans to sell one billion XRP to investors monthly through the On-Demand Liquidity service rather than through a crypto exchange. With reduced selling pressure on the open market, Ripple expects a sharp and immediate recovery.
How Can You Use the Ripple Effect To Your Advantage?
Ripple rolls out a suite of products and offerings to help its partners tap into the RippleNet network:
- xCurrent – An enterprise software solution built on the Interledger Protocol that does not rely on XRP. It allows financial institutions to process cross-border payments across RippleNet instantly. Other features include bidirectional messaging and end-to-end payment tracking.
- xRapid – It helps payment providers make global transactions in emerging markets with minimum liquidity costs.
- xViva – An intuitive payment API that enables financial institutions to move funds globally across RippleNet. The interface maintains transparency into the payment status by attaching invoices to the payments.
Differences Between Ripple and XRP
|Ripple is owned by Ripple Labs.||XRP is Ripple’s native token that is used across the RippleNet network.|
|Ripple aims to transform global payment systems.||XRP acts as a bridge currency.|
|Ripple provides products and services to financial institutions.||XRP is a digital asset used for facilitating payments.|
|Ripple is owned by its founders, board, and employees.||XRP is owned by only those using XRP and contributing to the XRP Ledger.|
Cryptocurrencies that kept innovating and evolving based on market demands grew and skyrocketed in value. Ripple understands this very well and is doing the same with its innovative technologies, offerings, and strategies. It is emerging as an industry standard for digital transactions across borders.
Banks and payment services providers love Ripple for providing them with on-demand liquidity and a cheaper and quicker way of handling international payments. With a change in strategy in the form of a buyback, Ripple is all set to embark on a journey where XRP could be the next big thing in the crypto world. However, one must know that Ripple and XRP are not the same before deciding to invest in it. One more thing to keep in mind is before investing your hard-earned money; you must check on XRP Price Prediction 2025 to get an idea about ripple future price updates; therefore, go through it!