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What Is Ripple?
Ripple is an open-source network designed for fast and cheap transactions. The platform has its own currency, XRP, which is a token used to represent the transfer of value around the network. The main aim of XRP is to be a mediator for both cryptocurrencies and fiat exchanges. Ripple has its patent technology called the Ripple Protocol consensus algorithm (RPCA). The consensus is a term used in blockchain when every node is in agreement with the rest.
Ripple is used for low commission currency exchange. As few currencies cannot directly be converted into each other, there is a need for a mediator, and Ripple is a mediator, which is also cheap. Ripple is also used for international transactions, which for average, takes only 4 seconds. Ripple also allows users to issues their own currency for cheap and fast transactions.
Ripple was developed with an aim to make day to day payment system easy. It is also capable of being exchanged in any currency or valuable without a hefty commission.
How Does Ripple Work?
Ripple is a digital payment processing system that runs through Ripple gateways, which are typically financial institutions like cryptocurrency exchanges. Ripple network is a large network where people using Ripple trust each other. There are chains of trust that interconnect Ripple gateways. Ripple gateways transport payment IOU information using https: This is the same protocol that banks already use for a secure card payment. After 3-4 seconds of the payment, the Ripple network triggers the gateways involved in the payments to update their ledgers. Each transaction charges an average fee of 0.00001 XRP.
Is Ripple a Blockchain?
Ripple is a technology platform and a cryptocurrency developed by Ripple Labs. Ripple Labs offers currency exchange services and real-time payment settlements to financial institutions like banks. Unlike many blockchain technologies which are secured by a decentralized network of miners, Ripple is secured by a network of servers that are validated having an internal ledger that guarantees transactions that are based on consensus. All 100 billion Ripple coins are already mined, and the company controls the dispersion of new coins.
Ripple transactions are not limited to XRP as it also supports fiat currencies like Euros, Dollars, Yen, and Pounds. Ripple brings security and speed to the cross border payment industry. Though the open-source code of Ripple is widely secure, it is open to attack.
There are many good things about Ripple, and it has also succeeded in gaining adoption in the financial sector where no cryptocurrency has succeeded. Looking at the trends, we can say that Ripple can transform the global payment industry.
