What is Ripple?

  • The XRP Ledger (XRPL) is an open-sourced distributed ledger powered by a network of peer-to-peer servers.
  • XRP is that the digital asset native to XRPL it’s designed to function as a bridge currency, with the goal to “power innovative technology across the payments space” and enable “seamless, real-time, final, and cost-effective” global payments.
  • The XRPL also supports IOUs (issued obligation-like assets tracked on ledger), which may represent an outsized variety assets (e.g. fiat currencies, gold, airline miles, mastercard points, and other cryptocurrencies).
  • The XRPL offers a decentralized exchange, allowing trading of IOUs and XRP. XRPL also offers smart contract functionality and supports the network-agnostic Interledger Protocol.
  • The supply of XRP is capped at a complete of 100 billion XRP while the available supply of XRP is meant to decrease over time, because the accrued amounts of transaction fees are “destroyed”.
  • XRPL was initially released in 2012. Since then, the varied components of the XRPL community are maintained by community participants. Furthermore, Ripple includes XRP in many of its service offerings.

Formerly referred to as OpenCoin, Ripple may be a privately held company that’s building a payment and exchange network (RippleNet) on top of a distributed ledger database (XRP Ledger). the most goal of Ripple is to attach banks, payment providers and digital asset exchanges, enabling faster and cost-efficient global payments.


Ripple was first idealized in 2004 by Ryan Fugger, who developed the primary prototype of Ripple as a decentralized digital medium of exchange (RipplePay). The system went sleep in 2005 and was meant to supply secure payment solutions within a worldwide network.

In 2012, Fugger handed over the project to Jed McCaleb and Chris Larsen and together they founded the US-based technology company OpenCoin. From that time on, Ripple began to be built as a protocol focused on payment solutions for banks and other financial institutions. In 2013, OpenCoin was rebranded to Ripple Labs, which was later rebranded to Ripple, in 2015.


The XRP Ledger (XRPL)

Based on the work of Fugger and inspired by the creation of Bitcoin, Ripple deployed the Ripple Consensus Ledger (RCL) in 2012 – along side its native cryptocurrency XRP. The RCL was later renamed to XRP Ledger (XRPL).

The XRPL works as a distributed financial system that not only stores all the accounting information of the network participants but also provides exchange services across multiple currency pairs. Ripple presents the XRPL as an open-source distributed ledger that permits for real-time financial transactions. These transactions are secured and verified by the participants of the network through a consensus mechanism.

Unlike Bitcoin, however, the XRP Ledger isn’t supported a symbol of labor consensus algorithm and, therefore, doesn’t believe a process of mining to verify transactions. Instead, the network reaches consensus through the utilization of its own customized consensus algorithm – formerly referred to as the Ripple Protocol Consensus Algorithm (RPCA).

The XRPL is managed by a network of independent validating nodes that constantly compare their transaction records. Anyone is in a position to not only found out and run a Ripple validator node but also to settle on which nodes to trust as validators. However, Ripple recommends its clients to use an inventory of identified, trusted participants to validate their transactions. This list is understood because the Unique Node List (UNL).

The UNL nodes exchange transaction data between one another until all of them agree on the present state of the ledger. In other words, transactions that are prescribed by a supermajority of UNL nodes are considered valid and therefore the consensus is achieved when of these nodes apply an equivalent set of transactions to the ledger.

According to Ripple’s official website, Ripple may be a privately held company that founded the event of the XRPL as an open-source distributed ledger. this suggests that anyone can contribute to the code which the XRPL is in a position to continue albeit the corporate ceases to exist.


In contrast to XRPL, the RippleNet is exclusive to the Ripple company and was built on top of the XRPL as a payment and exchange network.

The RippleNet currently offers a 3-product suite that’s designed as a payment solution system for banks and other financial institutions. Currently, RippleNet has three major products: xRapid, xCurrent, and xVia.


In short, xRapid is an on-demand liquidity solution that uses XRP as a worldwide bridge currency between multiple fiat currencies. Both XRP and xRapid believe the XRP Ledger, which enables faster confirmation times and far lower fees in comparison to standard methods.

Let’s take an easy example. Bob from Australia wants to send $100 to Alice who is predicated in India. Bob transfers the cash via a financial organization called FIN. so as to perform the transaction, FIN uses the xRapid solution to make reference to asset exchanges in both the originating and destination country. This way, the corporate is in a position to convert Bob’s $100 to XRP, which provides the required liquidity for the ultimate payment. during a matter of seconds, the XRP is converted to Indian Rupees and Alice is in a position to withdraw the cash from the asset exchange located in India.


xCurrent may be a solution designed to supply instant settlement and tracking of cross-border payments between RippleNet members. Unlike xRapid, the xCurrent solution isn’t supported the XRP Ledger and doesn’t use the XRP cryptocurrency by default. The xCurrent is made round the Interledger Protocol (ILP), which was designed by Ripple as a protocol for connecting different ledgers or payment networks.

The four basic components of xCurrent are:

Messenger – The xCurrent messenger provides peer-to-peer communication between connected RippleNet financial institutions. it’s wont to exchange information regarding risk and compliance, fees, FX rates, payment details and expected time of funds delivery.

Validator – Validator is employed to cryptographically confirm the success or failure of a transaction and also to coordinate moving of funds across the Interledger. Financial institutions can run their own validator or can believe a third-party validator.

ILP Ledger – The Interledger Protocol is implemented into existing banking ledgers, which creates the ILP Ledger. The ILP Ledger functions as a sub-ledger and is employed to trace credits, debits, and liquidity across transacting parties. Funds are settled atomically, meaning that they’re either settled instantly or not in the least .
FX Ticker – FX ticker is employed to define exchange rates between transacting parties. It tracks the present state of every configured ILP Ledger.
Although xCurrent is primarily designed for fiat currencies, it also supports cryptocurrency transactions.


xVia is an API-based standardized interface that permits banks and other financial service providers to interact within one framework – without having to believe multiple payment network integrations. xVia allow banks to make payments through other banking partners that are connected to RippleNet and also enables them to connect invoices or other information to their transactions.

Closing thoughts

While Bitcoin is understood because the first cryptocurrency and Ethereum is recognized for the creation of a platform for smart contracts, we may consider Ripple network as a currency exchange system that focuses on global payment solutions for banks and other financial institutions.

RippleNet could also be implemented on top of the prevailing banking infrastructure as how to enrich and improve the normal payment system. xCurrent allows for cost-efficient real-time payments across financial institutions, xRapid uses XRP as a bridge borderless currency to supply on-demand liquidity pools, and xVia facilitates the mixing and communication of all RippleNet participants.

About author

Experienced Founder with a demonstrated history of working in the newspapers industry. Skilled in Data Research, Management, Investment Research, Teamwork, and Leadership. Influencing the technology, people, and technical analysis of the Cryptocurrency and Blockchain world.
Related posts

Brad Garlinghouse: "we tried to settle claims with the SEC before the trial"


CoinMetrics: XRP Whales Down 8% Amid SEC Lawsuit Against Ripple


Ripple: "SEC lawsuit harmed multiple XRP retail holders"


B2C2 Cryptocurrency Market Maker Will Stop XRP Trading For US Clients

Sign up for our newsletter and stay informed

0 0 votes
Page Rating
Notify of
Inline Feedbacks
View all comments
Would love your thoughts, please comment.x