Ripple (XRP) – The Basics – All You Need to Know made Simple

Digital currencies in the year 2017 cannot be talked about without mentioning Ripple. Ripple (XRP) rose by 39,000 percent in 2017 alone. Between December 2017 and the first week of January 2018, XRP rose by 1000 percent making it the currency with the highest increase for that period. This increase shot ripple momentarily into the second place in the coin market cap behind bitcoin but later down to the third place behind Ethereum where it’s currently at. 

XRP has increased surprisingly amidst the criticism by Bitcoin enthusiast that it is not a cryptocurrency because of its centralized nature. This is unlike cryptocurrencies that are decentralized.

So, the question you might be asking now is, what is Ripple really? What is causing its increase? Who created it? What differentiates it from bitcoins? Is it safe to invest in it? How can I participate in the ripple network?

This is where I’ve got your back. I have answered these questions and more in a simple, concise, easy to understand and yet well-detailed manner. So, enjoy.

What is Ripple?

Ripple is the name of a digital currency (XRP), the network used in its transaction as well as the company that created it. created in 2012, It is be the currency that connected different banks around the world to aid faster international/cross-border transactions. this will eliminate middlemen that make such transactions expensive and slow. I will help you understand this better from this scenario below.

Onyii in Nigeria wants to send money to Ada in Australia. He has Naira (NGN), Ada requires Australian Dollars (AUD). Onyii will have to go to his bank, convert his naira to US-Dollar (USD) and send the USD to Ada through Western Union or Money Gram. Ada would then receive the USD and convert it to AUD. This is a lot of processes it usually takes 2 to 7 days. It also cost a lot in transaction/exchange charges. 

With the Ripple network, this process can be easier, faster and less expensive. The process is still quite the same. Onyii converts his naira to ripple (XRP),  send the ripple to Ada in a matter of seconds, Ada receives it and convert it to AUD.

Someone may argue that bitcoin can be used to do the same thing. Yes, but there are differences,

  • The bitcoin blockchain can handle 7 transactions per second while the Ripple network can handle 1,000 transactions per second.
  • Standard Chartered and 21 other banks have integrated the Ripple network into their network. What this means is that Onyii in Nigeria banking with standard chartered can send money to Ada in Australia banking with Wespac bank With his Standard Chartered mobile app from the comfort of his home. Ada will receive this money  in her Wespac bank account and this process will take 5 to 10 seconds at a very low fee.

Who created Ripple?

Two Bitcoin enthusiast Chris Larsen and Jed McCaleb created Ripple. They studied the bitcoin blockchain and decided to create something similar with Ripple. Unlike the bitcoin blockchain which is mined and everyone can participate in the mining and decision making the ripple network is not so. The founders created 100 million ripples (XRP) at the launch of the network, they kept 20 million XRP for themselves and release the rest to the Ripple company. The rise in the value of XRP to over $2 per coin has practically made its founders billionaires.

There are currently about 45 million ripple coins (XRP) in circulation while the company are in procession of the rest. This is where the cryptocurrency community are not comfortable with the Ripple coin (XRP) because the company controls the coin and the network making it centralized rather than decentralized like other cryptocurrencies. Investors are also not at rest with this, they are afraid the ripple network may release too many coins to the market at once, thereby saturating the market with the coin and making its value drop.

To tackle this, the Ripple company in 2017 put the 55million Ripple coin in 55-smart contracts that releases 1 million coins automatically each month.  However, the company receives the released XRP to do as they will. However,  they stated they will distribute these coins through charitable organisations, users and strategic partners.

Why is the Value to ripple rising so fast?

The ripple coin was not created  to compete or replace the banking system like most other cryptocurrencies rather it came to compliment it. These can be seen by the adoption of Ripple by banks around the world. It’s been rumoured that about 73 financial institutes in Japan alone are planning on adopting ripple as their payment network. Another reason why banks might be geared towards this network is control. Banks want ‘control’ which the ripple company provides. These high adoptions of this network by banks and financial institute might have caused the rise in value of the coin XRP. 

Individuals can also use the ripple network for secure peer to peer transaction. This might not be its original intentions but online stores that accept ripple are on the increase. You can click here for the full list of stores that accepts ripple.


Bank and Financial Institutions with Ripple

Here is the list of financial bodies that have partnered with ripple.

Bank of Tokyo-Mitsubish UFJ, RBC, Santander, Standard Chartered, Westpac, Credit Agricole, American Express, UBS, Axis Bank, SBI Remit, SEB, BMO, UniCredit, CIBC, BBVA, RAKBANK, YES BANk, IFX, TransferGo, BEXS, Currencies Direct, MUZUHO, CUALLIX, SCB. AIRWALLEX, d-local, AKBANK, Cambridge Global Payments, eZforex, FAB (First Abu Dhabi Bank), MoneyGram.

banks with Ripple XRP


Ripple Vs Bitcoin?

Creation Date20122009
Coin Market Cap (15/01/18)~ 70.5 billion~ 241 billion
Coin Limit100 million XRP21 million BTC
Transaction Time4 seconds10 minutes
Information TrackingYesNo
FeesYes (destroyed)Yes (goes to miners)
Wallet20 XRPFree
CreatorChris Larson & Jed McCalebSatoshi Nakamoto

Note: Bitcoin transaction is instant, it’s the confirmation that takes not less than 10mins, in recent times, bitcoin transaction confirmation takes about an hour or more. Ripple transaction confirmation takes only 4 to 10 seconds.

Bitcoin wallets are free, you can have as many bitcoin wallets as you want for free. Ripple wallet costs a one-time payment of  20 Ripples to secure, if you want more ripple wallet you will have to pay 20 XRP for each of them. For example, if I have an unused ripple wallet and I send 100 XRP to it, 20 XRP will be used to secure the wallet. I will only be able to use 80 XRP.


How can I store Ripple?

Ripple (XRP) are stored in ripple wallet. Owning a ripple wallet requires a one-time fee of 20 ripples. You can have as many wallets as you want but you will have to pay 20XRP for each of them. However, one ripple wallet can serve all the purpose you can require. some ripple wallet Provider is listed below.

Ledger Nano S.

Ledger is a hardware wallet for 27 cryptocurrencies including ripple XRP. Hardware wallets are the safest kind of wallet. Because they are offline, you can literally carry then in your pocket. Unlike online wallets, hackers cannot attack hardware wallets because they are offline. The downside to hardware wallets is that is you lose the device, you have lost all the currency you have in it. It also cost to purchase. Ledger Nano is about 79. Click Here to Buy

Other XRP wallet providers include CEXBinance, Rippex, Gatehub,  Bittrex, Poloniex.

Also Read: Top 5 Ripple wallets.


Where can I buy Ripple?

Some of the wallet providers like above allows you to buy XRP directly on the platform. However, there are exchanges that do not provide ripple wallet but you can buy and sell ripple from and to them instantly. They include Changelly. and Ngexchanger.

Also Read: Top 5 Exchanges to Buy and Sell Ripple XRP


Is it Advisable to Invest in Ripple (XRP)?

Investment in any currency or anything at all should be done with caution. If you bought Ripple (XRP) of $100 in January 2017, your XRP should be worth nothing less than $30,000 by January 2018. However, this does not guarantee that the value of XRP will continue to rise. It may continue to rise especially if it is adopted by more banks however, this is not guaranteed. If you want to invest in ripple, I suggest you invest the money you can afford to lose. Don’t quote me wrong I did not say “money you expect to lose” but “money you can afford to lose” This is because the value can go either way; you can get rich from it or lose your fund. keep in mind also that you will have to sacrifice 20 XRP to secure the wallet. All the best.

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