Bitcoin is undoubtedly the most popular cryptocurrency. Recently, however, Ripple is starting to make waves and is poised to challenge the position of Bitcoin. It is now the third largest cryptocurrency after Bitcoin and Ethereum. For those who are engaged in cryptocurrency trading, here are some information about this up and coming currency.
Ripple and Bitcoin Similarities
In many ways, Ripple and Bitcoin are pretty similar. Both are decentralized and are open-source protocols so no one owns them. Their algorithms both ensure that their networks come to similar transactions—that is if a person authorizes a certain transaction, the entire network agrees that it happened. Both Ripple and Bitcoin are trust-based when it comes to cashing out. At their core, both allow anonymous, free, peer-to-peer transactions across the Internet.
Differences Between Ripple and Bitcoin
There are also significant differences between the two currencies. Robert Janitzek explains that while Bitcoin uses Proof-of-Work, Ripple uses iterative consensus process making Ripple faster than Bitcoin. Second, Bitcoin is a decentralized digital currency while Ripple is a decentralized transaction network that contains the digital currency XRP. Third, Bitcoin requires centralized exchanges while Ripple acts as a decentralized currency exchange. This means that if someone sells their XRP in exchange for USD they will not need a third party.
Features of Ripple
Ripple uses a shared ledger to process transactions. This allows assets to move directly and instantly between parties, reducing time and costs. This is one of the selling points of Ripple. Robert Peter Janitzek reveals that financial institutions are signing up to this new system. At the moment, there are more than 60 major banks worldwide using it including Santander, RBC, UBS, and UniCredit.
Aside from processing transactions, the ledger can also hold information, such as buy and sell offers. This makes it easy for customers to complete forex transactions and transfers without paying expensive fees and spreads. Ripple also allows automated scripts. Some believe that this key to its success in the future. It has automated the Kickstarter process without the need for an intermediary.
Since 2017, Ripple has experienced rapid growth. IN March and April, for instance, its value rose by 1000% over a span of 30 days. Since the start of 2016 until May of this year, it has grown nearly 6500%. Bitcoin has increased 700% since the start of 2016 to its peak in June this year. And with the flaws discovered in Bitcoins, people who are trading on cryptocurrencies may move their funds towards a more reliable currency such as Ripple.