Is Ripple the best cryptocurrency in the world right now?
2025-01-25
Category: None

Hello and greetings to all the crypto enthusiasts, ✌

 Reading this educational material will require approximately 10 minutes of your time . For your convenience,  I have summarized the key points in 10 concise lines at the end . I trust this information will prove to be insightful and valuable in enhancing your understanding of Ripple and its role in the global financial landscape.

 Personal Insights and Technical Analysis of Ripple: 
Ripple stands out as an innovative solution for interbank communication and a glimpse into the future of global financial transactions. Its vast potential has caught my attention for several years, and I’ve been following its development closely. From a technical standpoint, I believe  Ripple’s price could initially hit targets of $4, $6, and even $10 . Looking further ahead, there's potential for even higher valuations in the long run.

 That being said, please take note of the disclaimer section at the bottom of each post provided by the website, this is merely my personal opinion and should not be interpreted as financial advice.
 
 Understanding Ripple’s True Nature: 
When most people hear "Ripple," they immediately think of cryptocurrency. However, many overlook that Ripple is not just a digital currency, but mainly a digital payment network. This is a key distinction because Ripple’s goal is much broader than simply being a cryptocurrency. While Bitcoin is mainly a store of value and a form of digital money, Ripple’s primary focus is on facilitating global money transfers.

XRP, often called Ripple, is the currency used within this payment system, mostly for paying transaction fees. Ripple runs on the XRP Ledger (XRPL), an open-source, decentralized blockchain built to enable fast, secure transactions through Ripple's protocol, RTXP.

Ripple’s network is often confused with blockchain, but it’s more accurately a type of distributed ledger technology (DLT). Ripple uses a unique consensus method known as the Ripple Protocol Consensus Algorithm (RPCA), based on the Federated Byzantine Agreement (FBA) protocol. This approach differs from Bitcoin’s, allowing Ripple to offer quicker transactions and lower fees than traditional banking systems.

 Ripple's Consensus Mechanism: 
Ripple’s RPCA is designed to quickly and securely verify transactions. A group of independent nodes within the network work together to reach a consensus on whether transactions are valid. This process is central to Ripple’s mission of enhancing transaction speed and cutting costs, making it a real alternative to traditional financial systems.

 XRP Supply and Distribution: 
XRP is integral to Ripple’s network. The total supply of XRP is capped at 100 billion tokens, all of which were pre-mined before Ripple’s official launch in June 2012. Here’s how they were distributed:

20 billion XRP went to Ripple’s founding team and early investors.
55 billion XRP were locked in an escrow account, with 1 billion XRP released each month according to a set plan.
The rest was sold to early investors during the initial coin offering (ICO).
Ripple vs. SEC Legal Dispute:
The legal battle between Ripple and the U.S. Securities and Exchange Commission (SEC) started in late 2020 and became one of the most high-profile cases in cryptocurrency history. The SEC argued that XRP should be classified as an unregistered security, claiming Ripple Labs raised over $1.3 billion from XRP sales. Ripple denied this, stating that XRP is a utility token with multiple use cases beyond being a security.

In June 2023, a judge ruled that while XRP sales to institutional investors counted as unregistered securities, the “blind bid” method (where buyers' identities are hidden) allowed Ripple to win partially. This ruling was a significant step in the case, though legal challenges were far from over.

By October 2023, the SEC expanded its lawsuit to include claims that Ripple executives Garlinghouse and Larsen had violated securities laws. However, in August 2024, the court ruled with Ripple, fining the company $125.023 million—much less than the $1.9 billion the SEC had initially sought. The most important takeaway was that XRP itself was not considered a security.

 Ripple’s Main Products: 
Ripple offers three key products for banks and financial institutions, collectively known as RippleNet:

xCurrent
xRapid
xVia
Each of these solutions addresses different problems in the financial industry, but it’s important to note that only xRapid directly uses XRP. The other two, xCurrent and xVia, don’t require XRP to function.

xCurrent:
xCurrent allows financial institutions to process real-time, cross-border payments. It uses a distributed ledger called Interledger, which was created by Ripple’s team but is managed by the World Wide Web Consortium (W3C). Unlike Ripple’s proprietary XRP Ledger, Interledger’s role is to facilitate seamless and secure exchanges between currencies, not just digital assets like XRP. XRP is not needed for xCurrent.

xRapid:
xRapid solves liquidity problems in cross-border transactions by using XRP. This service enables financial institutions to convert fiat currency into XRP for transfer, and then back into the local currency when it reaches the destination. This eliminates the need for intermediary banks and makes international payments faster and more cost-effective. However, XRP’s liquidity across global exchanges is crucial to xRapid’s success.

xVia:
xVia is an interface that connects Ripple’s products, xCurrent and xRapid, to streamline how businesses integrate Ripple’s solutions. Launched in 2018 and still in testing, xVia aims to simplify payments for businesses around the world.

 Ripple’s Team and Evolution: 
Ripple’s journey began in 2004 when Ryan Fugger created RipplePay, a system meant to enable global peer-to-peer payments. Although it had potential, it didn’t gain much traction, with fewer than 10,000 users by 2011.

In 2011, Jed McCaleb, a well-known figure in the Bitcoin community, took over the project. He convinced Fugger to hand him control, setting the stage for Ripple’s transformation.

Chris Larsen’s Role and Ripple’s Rebranding:
In 2012, McCaleb brought on Chris Larsen, a successful tech entrepreneur, to help drive Ripple’s development. Together, they rebranded the company as Opencoin, which was the first of three name changes before it became Ripple Labs.

That same year, Jesse Powell, the founder of a major cryptocurrency exchange, invested $200,000 in Ripple, helping propel the company’s growth, along with backing from early investors like Roger Ver, Bitcoin Cash’s creator.

McCaleb’s Departure and Stellar:
In 2014, McCaleb left Ripple due to internal differences, feeling the company was moving away from his original vision. Soon after, he co-founded Stellar, another blockchain project focused on financial inclusion and cross-border payments.

🧨  Our team's main opinion is:  🧨
Ripple is an innovative digital payment network, not just a cryptocurrency. Its primary focus is enabling global money transfers, with XRP acting as the utility token for transaction fees. Operating on the XRP Ledger, Ripple uses a distinct consensus mechanism (RPCA) to ensure fast and cost-efficient transactions. The total XRP supply is capped at 100 billion, with a large portion kept in escrow. Despite facing legal challenges, particularly with the SEC, key rulings, including one in 2024, affirmed that XRP itself isn't considered a security. Ripple offers three main products: xCurrent (for cross-border payments), xRapid (providing liquidity through XRP), and xVia (for easy integration). Ripple's journey began in 2004, but it took a pivotal turn in 2012 when Chris Larsen and Jed McCaleb rebranded the company. McCaleb eventually left in 2014 to co-found Stellar, another blockchain project focused on similar goals.

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