What is Ripple and How Does it Differ From Bitcoin?

Ripple is a cryptocurrency that is often lumped into the same category as Bitcoin.  But should this comparison always be made or does Ripple deserve to be categorised independently?  We think it does, and in this article, we’re going to take a closer look at just what Ripple is, how it differs from the well-known Bitcoin, and also take a look at the hype surrounding it.

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So, What is Ripple?

Ripple was released in 2012 and is technically an RTGS (real-time gross settlement) currency exchange network.  Because it uses a common ledger, maintained by validating servers on an independent network, it doesn’t require the computing intensity of Bitcoin or rely on energy.  Ripple ensures integrity through a shared public database of servers, and these servers can be owned by anyone, from banks to individuals.

Ripple enables the direct and instant transaction of monies between two parties, and it’s not just XRP that can be exchanged.  Everything from air miles to gold can be transferred over the Ripple network.  Ripple marketed itself as a way for users to avoid the fees and long wait times that were common with banks, and as a way to exchange all different kinds of currency.

How Does Ripple Differ from Bitcoin?

As soon as people hear the talk of servers, they instantly believe it to be a blockchain technology, like Bitcoin.  However, this isn’t the case.  Plus, while Ripple can be used to transfer money from person to person (in the way Bitcoin is intended to be transferred), this isn’t its primary focus.  Instead, the focus of Ripple is to move money from country to country as quickly and cheaply as possible.  It is this that has made it favourable with banks, in a way that Bitcoin hasn’t managed to do.

Over 35 million transactions have been made over the Ripple platform since it was released, and it has been stable since 2012.  Over 1,500 transactions can be handled per second.  Bitcoin, on the other hand, can handle between three and six transactions per second, so you can see the difference.

In addition, while stored in an XRP wallet in a similar way to a Bitcoin wallet, Ripple’s token XRP isn’t mined in the same way that Bitcoin is, or indeed other cryptocurrencies like Litecoin and Ethereum.  Instead, when the company was incorporated it released 100 billion XRP coins and distributed them in a similar way to how a company issues stocks. 

What’s With the Hype?

It’s fair to say that Ripple hasn’t seen the same amount of hype as Bitcoin but that doesn’t mean people haven’t heard of it.  All cryptocurrencies seem to be attracting the attention of investors and Ripple is included in this.  Rumours in 2017 regarding Coinbase listing Ripple also led to a surge in the price.  Coinbase finally listed Ripple in December 2018.

It will be interesting to see what happens in the future with Ripple, but from an outsider standpoint, it certainly looks to have a more stable future than its competitor Bitcoin.