With a market value of $26.73 billion, XRP is among the largest cryptocurrencies globally. Existing with many advantages compared to other cryptocurrencies many investors prefer to hold XRP rather than selling them in the short term.
Key takeaways
- The current market cap of XRP is $64.06 billion.
- The price of 1 XRP currently stands at $1.12.
- The current trading activity of XRP is 6.74 billion in 24 hours.
What is XRP?
XRP is a cryptocurrency that was developed and launched by the American company Ripple Labs. It allows cross-border transactions, providing more efficiency than any other cryptocurrency. This popular digital currency lies on the XRP ledger and processes transactions within seconds.
By eliminating the need for an intermediary, XRP bridges two different currencies quickly and efficiently. It is one of the most cost-effective mediators for currency exchange.
How does XRP work?
- The XRP ledger transfers tokens using ledger technology in addition to blockchain technology. Everyone can access the open protocol system without requiring previous permission from Ripple Labs.
- Every XRP transaction needs independent validator nodes to reach a consensus. The consensus is final and immutable.
- The ledger issues transactions every 3 to seconds and then a new ledger is issued.
- A financial institution, exchange, or any individual can become the validator.
- All servers in the network process the transactions by following the protocols, and every transaction that abides by the protocol is processed immediately.
- The federal consensus mechanism validates the transactions without an error.
Use cases of XRP
- Payments
- Tokenization
- DeFi
- Stablecoins
- Central Bank Digital Currency (CBDC)
The History of XRP Supply, how many are left to buy?
- The original founders of Ripple pre-mined 100 billion XRP tokens, the maximum amount of the coin, in 2012.
- Later, 80 billion tokens were distributed as part of the Ripple project with the goal of supporting operations and future advancements.
- Out of the 80 billion XRP, 50 billion was transferred to the escrow account in 2017, which will not be counted in the circulating supply.
- There are presently 56.93 billion XRP tokens in circulation.
Using an XRP
- XRP serves mainly as an exchange mechanism across borders, with an acceptance of more than 4500 traders across the world.
- An XRP is stored in a wallet. One can choose a wallet depending on the level of security and functionality they require.
- Kriptomat exchange is one of the secure options for storing XRP tokens. It allows the buying, selling, and exchange of cryptocurrencies.
- A corporation issues its supply of XRP at a fixed rate that is decided by its executives.
- The transactions are processed by a committee of stakeholders and pre-approved by the executives.
- Though this mechanism is not strictly decentralized, it solves issues associated with traditional banking mechanisms.
Final Thoughts
XRP allows exchange across different countries with faster and more cost-effective transactions. The open protocol system allows everyone to access the system without the need for prior approval. Unlike other cryptocurrencies, the XRP ledger does not use a proof of work or proof of consensus mechanism; instead, it uses a federative consensus algorithm, allowing network participants to trust other participants. The Ripple community is in charge of managing the XRP ledger. It might help shape the financial industry in the future.