What Is Ripple

Ripple Crypto Coin Explained

Ripple Cryptocurrency Coins

When Bitcoin emerged in 2009 with the introduction of blockchain technology it was the dawn of the cryptocurrency era. Bitcoin was considered the king of the cryptocurrency and rightly dominated a small but slowly flourishing market. In recent years there has been an explosion of ICO (Initial Coin Offerings – similar to a share prospectus), and along with that came several challengers to Bitcoin’s market dominance. There have been a number of contenders to that prestigious crown, with many different and innovative platforms. Ethereum is probably the one to get the closest to the crown, then Litecoin who also experienced a steady growth, but there is one that is the most interesting of them all. Ripple is probably one the unique coins on the market today. It offers a much more centralized feel in a largely decentralized space.

  • What is Ripple?

Ripple was originally released in 2012 as a follow up to Ripplepay. It is designed to be a real-time gross settlement system (RTGS) and serve as a currency exchange. As opposed to Bitcoin, Ripple is not about energy consumption as a proof of work. It uses a network of independently validating servers that pose as a ledger where these servers continuously monitor transaction records. These servers can be anyone’s property, from banks to individual users. Ripple’s integrity is based on an agreement process between those validating servers that operate on a shared public database.

XRP, a Ripple protocol token, is planned to allow direct and prompt money transfer between two consenting parties. With the help of Ripple, you can exchange any type of currency from regular fiat currency to even airline miles. The best thing about Ripple is that they claim that the mentioned exchange is executed without fees and a lag time in the transfer process that are common features of traditional banking. They even say that it is possible to avoid cryptocurrency transactions via exchanges.

  • Who Is Behind Ripple?

Jed McCaleb, formerly employed at Mt. Gox, a cryptocurrency giant that handles the majority of global Bitcoin exchanges, and Chris Larsen who was a co-founder and CEO of the E-LOAN, an online financial company, joined forces and created “OpenCoin” (Should not be confused with OpenCoin.org, which is developing an open-source version of an electronic cash system), a company responsible for introducing Ripple protocol to the cryptocurrency community. With the team of developers that also have Bitcoin background, they hit the ground running and managed to gather funding from Andreessen Horowitz, FF Angel IV, Lightspeed Venture Partners, Vast Ventures and the Bitcoin Opportunity Fund.

  • What Is Ripple Used For?

    Ripple Coin Is A Popular Coin

    Ripple Coins In A Physical Form

As we already said, Ripple protocol is used to execute rapid and direct transactions of any currency. Put that together with the fact that opposing to other cryptocurrencies that use blockchain technology and are entirely decentralized and lack any control, Ripple’s transactions are handled by and controlled by the regulatory financial institutions and Ripple Labs. Those financial institutions are regular banks like Santander like American Express that back this cryptocurrency and have a hand in its operations and growth.

The XRP token itself, however, seems to have a very small influence. Ripple even planned to discontinue XRP until the whole crypto-craze took off in 2016. The token is used entirely independent of the Ripple protocol. This actually means that banks do not need XRP to transfer any currency which is a fact that small investors need to keep in mind when planning to buy the token.

  • Can You Mine Ripple?

Unlike other, well-known tokens, XRP is not possible to mine. The company that created it issued a number of 100 billion XRP at the beginning and remained the only entity that is able to generate further XRP. Being that every XRP used in a transaction is being eliminated and unable to be used ever again, it is a fair assumption that as the XRP community grows, the token will decrease in numbers and therefore become more valuable. On the other hand, no one can forbid the company to issue another 100 billion.

  • Is Ripple a good investment?

The rise of the XRP value should be attributed to the enlargement of the worldwide Ripple network. As more financial institutions follow the lead of the likes of Santander and American Express, the bigger is the demand for the coin. Some predictions are that 2017 was the trial year for Ripple and that in the coming year the cryptocurrency will experience some important implementations by major Financial Institutions. This will certainly result in a short-term growth in value. Though, no one can predict what will happen in the long run since Ripple has practically only just commenced its crypto-career.

 

Conclusion

As you can see, Ripple really poses a unique presence in the ever-growing cryptocurrency world. As we said, it provides a centralized feel in a largely decentralized space and shows a great potential to change the traditional currency transaction process as we know it. On the other hand, like any other newly discovered cryptocurrency, Ripple’s future cannot be predicted with any dose of certainty. Especially when you take in mind the unpredictability of the XRP. At the end, time will tell what is the final reach of this interesting crypto.

 

The authors currently do not hold any Ripple coin and make no recommendation whether or not you should invest in Ripple or any other Altcoins. Information provided is designed to give you some insight into the Ripple cryptocurrency that may assist you in formulating your own opinions.

Ethereum V Bitcoin

Ethereum V Bitcoin: Which One Do You Buy?

Ethereum Vs Bitcoin

Bitcoin and Etherum are both cryptocurrencies but are totally different

With the extreme rise of the crypto-community in the past couple of years, accompanied by the continuous emergence of new coins, arose the need for endless comparison of those cryptocurrencies. Whether in the terms of sheer value or the functionality of their blockchain technology, their comparison is a constant topic on every site or forum even remotely related to the topic of cryptocurrency. Logically the most common is the comparison between the two with the largest market cap, Bitcoin ($ 236 B) and Ethereum ($ 132 B). (For an instant update on market capitalization click here) So in this article we are going to explain the main differences between these two juggernauts.

The Technology Behind Bitcoin and Ethereum

First and foremost, we will explain and compare the main purposes of these cryptocurrencies as well as the way they use the blockchain technology since there lie the crucial differences between them.

How Does Bitcoin Work:

How Does Bitcoin Have Value

How Does Bitcoin Work

As most of you already know, Bitcoin is the first virtual currency released in 2009 by a phantom Satoshi Nakatomo introducing the blockchain technology to the world. With its main purpose being just that, as well as to serve as an alternative payment method and store of value which is not operated by any centralized authority, unlike fiat currencies. These features got the whole thing going and started the entire cryptocurrency craze. Over the years the acceptance of cryptocurrency concept increased, and Bitcoin became accepted as a formal way of payment by global companies such as Microsoft or Dell.

For an interesting You Tube overview of  how Bitcoin works click here.

Ethereum was introduced in 2015 by Vitalik Buterin. As Bitcoin, it also operates using blockchain technology but uses it for a different purpose.

How Does Ethereum Work:

Ethereum explanation

Ethereum Vs Bitcoin

Unlike Bitcoin, the way that Ethereum works is to use it’s blockchain to enable the creation of Distributed Applications that are not used only for maintaining the Ethereum blockchain. These apps are created without any control, downtime or a need for a third-party interference. In a sense, we might say that Ethereum is not only a platform but a programming language that is running on blockchain technology.

Other Ways Ethereum Works: Ethereum also uses a SmartContract system to facilitate transactions of money, property or anything of value between people while providing the security of using a third party as a control without the need of actually using it. Ethereum can even be used as a platform for other cryptocurrencies. Actually, many other cryptocurrencies are built on or even relying on its technology.

For a brief explanatory video by Ethereum’s founder Vitalik Buterin click here.

As you can see the two cryptocurrencies differ in their main purpose. While Bitcoin is mainly created as an alternative for regular money and used as a payment method and store of value, Ethereum’s main purpose is to serve as a platform that facilitates peer-to-peer transactions and creation of Distributed Applications and monetize the work of developers.

Value and Mining of Ethereum & Bitcoins:

After we went through the technical differences, now we are going to move to a topic that is probably more interesting for the cryptocurrency enthusiasts. Here we will compare their current value and mining potential.

  • By being the most valuable coin on the market Bitcoin is, logically, the better choice as a store of value. Not only it is more expensive ($ 14,068.20 comparing to ETH $1,366.26 – at the time of writing this article), but it is the most recognizable and acceptable one in the world. That makes it easier to obtain, store, sell or use as a direct way of payment. This can be attributed to Bitcoin’s built-in shortage. Namely, Bitcoin is a finite resource and has a predefined final number of 21 million, after which no more Bitcoins will be created. In theory that means that their value will grow the closer, it is to the end.
  • On the other hand, Ethereum will continue to release the same amount of coins forever which makes it supply constant and expanding. Bear in mind that cryptocurrency market is young, highly volatile and still not completely explored, therefore no one can really make any exact predictions on what will happen with any of these coins in the future.
  • When it comes to mining the embedded scarcity of Bitcoin will become ever harder to mine as approaching to that 21 million mark. To explain, it works like this: the reward for mining Bitcoin blockchain block is cut in half after every 211.000 blocks mined. Current block prize is 12.5 Bitcoins per mined block which is a large difference in comparison to starting 50 Bitcoins per block.
  • On the other hand, Ethereum miners are rewarded by its proof-of-work algorithm called Ethash. The reward is 5 ETH for each block mined. Ethash also encourages decentralized and individual mining, unlike Bitcoin where miners need to use more expensive ASICs in order to make a profit.

 

  • Another difference related to this topic is the block confirmation time.
  • Bitcoins average block confirmation time is 10 minutes
  • Ethereum takes it down to 12 seconds. This is enabled by Ethereum’s GHOST protocol which makes confirmations quicker but, at the same time produces more orphaned blocks.
  • As you can see as Bitcoin’s popularity makes it better as a store value, while its finite number and the fact that almost 80% of its resources are already mined makes it harder for new miners to make a profit.
  • Ethereum is currently one of the most profitable coins in terms of mining.

Summary
All in all, although both Bitcoin and Ethereum are called cryptocurrencies and both use blockchain technology, you can see from this article that they are essentially two completely different concepts.

  • While Bitcoin is used as a payment method
  • Ethereum’s main purpose is to serve as a platform that facilitates transactions and enables the creation of Distributed Applications.                                                              To determine which one is “better” you will have to ask yourself “what do I need it for?”. If you want to use it as store value then Bitcoin’s popularity and recognition take the advantage, while its finite supply, built-in scarcity and the fact that almost 80% of its resources make it less profitable for mining. If you are wondering in which one to invest, then your guess is as good as ours. Both have shown an increase in value since their introduction but the volatility and the young age of cryptocurrency market make it practically impossible to provide accurate predictions.
    We strongly suggest that you do your own research and don’t invest more than you can afford to lose!