Ripple, a digital or crypto curtrency similar to Bitcoin, originated in 2012 and was built on a distributed open sourced consensual protocol. Its abbreviation is XRP and it was designed to “secure, instantly and nearly free global financial transactions of any size with no chargebacks.” The currency was designed to be used as a transactional medium and provide an alternative to fiat systems such as PayPal, Credit Cards, Banks and similar institutional tools. It has been described as a ‘real-time gross settlement system (RTGS),’ and is also called the Ripple Transaction Protocol (RTXP) or Ripple protocol. Ripple does not depend on the energy and computing intensive proof-of-work required by Bitcoin. Instead Ripple is based on a shared public database using a consensus process between validating servers to ensure integrity.
The Ripple Company was co-founded by CEO Chris Larsen and CTO Jed McCaleb. McCaleb came from Mt. Gox, and Larsen was a previous co-founder of E-LOAN.
According to the Ripple Company, the goal of Ripple is, to build on the decentralised digital currency approach set by bitcoin and “for money what the internet did for all other forms of information.”
This means that as well as a currency transactional medium it is also capable of bringing different payment systems together making it somewhat more extensive in range than Bitcoin.. This is because while, Bitcoin is a digital currency designed simply as a means of payment for goods and services, Ripple goes further as is constructed to be a payment settlement system suitable for the direct exchange and remittance suitable for banks and other payment networks. This means an almost immediate settlement of the direct transfer of assets such as money, precious metals etc that is cheaper, more transparent and more secure than existing systems such as the SWIFT banking payment system.
Ripple does not see itself as a competitor to Bitcoin however, more of an enhancement. “Ripple will open up many more gateways for bitcoin users and easier ways to bridge bitcoin with the mainstream world of finance,” commented Stephen Thomas, Senior Developer with Ripple and a bitcoin advocate. Ripple also says it will provide expedited transactions and increased stability as it does not depend on one company to manage the transaction database so there is no waiting on block confirmations. This speeds up the confirmations and decreases the cost.
Banks currently trialing Ripple include Fidor Bank, Santander, the Commonwealth Bank of Australia and a consortium of 61 Japanese banks among others. MoneyGram, MercuryFX, IDT and Cuallix are four major payment providers who have also publicly announced their pilot use of XRP in payment flows through xRapid to provide liquidity solutions for their cross-border payments. Ripple currently has a growing pipeline of financial institutions that are also interested in using XRP in their payment flows.
Ripple offers an example of the ease of transfer of assets using Ripple on its website, “Some digital assets, like Bitcoin, aim to replace existing government-backed currencies. XRP works with fiat currencies on more than 10 digital exchanges to help transfer value across borders quickly and efficiently. For example, a Mexican company who wants to pay a supplier in Korea today would either need to pre-fund an account in Korea or go through a foreign exchange provider like a bank. Both options are expensive and slow. With XRP, the company’s Mexican bank or local payment provider allows the company to make the payment instantly and on demand. With no account pre-funding or foreign exchange fees, XRP makes for a faster, cheaper settlement.”
So it provides a faster cross boarder functionality that also applies not just to fiat currency but to digital and other assets transfers. Fees are minimal, much less than PayPal, banks and even Bitcoin, a small amount equivalent to 1/1000th of a cent per transaction.
Purchasing and using Ripple is quite simple. As an individual one can buy and hold Ripple through more than 60 digital exchanges that provides Ripple which are most of the major exchanges. Commercially it is likely better to go to the Ripple Website and deal with them directly.
This article is for information purposes only and is not to be construed as financial information for any purposes such as investment or speculation and it is the responsibility of the reader to perform proper due diligence before acting upon any of the information provided. We recommend that you consult with a licensed, qualified investment advisor and certified accountant before making any investment decisions.
Many banks are adopting Ripple as the platform to use in replace of SWIFT. Standard Chartered is the latest bank to adopt and extend Ripple for cross-border payments. It started in November 2017 and has been extending its range since then. It uses the system to speed up payments between buyers and sellers in the supply chain. The bank operates a 15 billion dollar trade between Singapore and India using ripple and Bill Winters, Standard Chartered CEO recently announced, “We are using blockchain technology to streamline cross-border payments as part of the first live, real-time payments corridor between Singapore and India that we initiated in 2017. We will expand this capability to five more pairs of countries in 2018.”
With the increasing partnering with large businesses It is now believed that Ripple is at a turning point and about to enter ther mainstream with gusto.
Just recently Koinex launched Ripple with 6 pairs going live. They ‘announced the launch of Ripple [XRP] based trading, allowing trading of 15 tokens pairs on both web and mobile. Aeternity [AE], Litecoin [LTC], OmiseGo [OMG], Request Network [REQ], Golem [GNT], Tron [TRX], Nucleus Vision [NCASH], and EOS [EOS] are paired with XRP.’
“Ripple [XRP] has always been a crypto-crowd favorite because of its high liquidity and ease to transact. For the first time in the crypto world, Koinex proudly presents XRP-based trading market with 8 XRP pairs going live tonight.”
Mercury-FX Ltd is also pleased with Ripple’s Liquidity Solutions and recently tweeted, “In Q1, along with other xRapid pilot’s customers, we have proved that #xRapid can lower liquidity costs & increase payment speed and transparency using #XRP. We are looking forward to continued successful testing and going into production.”
Ripple now has over 100 cliernts who hasve signed up to use their platform including Santander, UniCredit, UBS and of course Standard Chartered. According to CNBC, “Its distributed ledger network, RippleNet, has been joined by the likes of United Arab Emirates (UAE)-based lender RAKBANK and U.K.-based currency exchange firm IFX. It has also cleared a payments path into South America by signing up online payment provider dLocal.”
Other companies adopting Ripple include
Banco Bilbao Vizcaya Argentaria
Cambridge Global Payment
Canadian Imperial Bank of Commerce
Cross River Bank
Mitsubishi Financial Group
National Australia Bank
National Bank of Abu Dhabi
Royal Bank of Canada
Shanghai Huarui Bank
Westpac Banking Corp
Among many otheres
This news item is for information purposes only and is not to be construed as financial information for any purposes such as investment or speculation and it is the responsibility of the reader to perform proper due diligence before acting upon any of the information provided. We recommend that you consult with a licensed, qualified investment advisor before making any investment decisions.