Ripple is a global payment system which expedites the international transfer of any currency within seconds. The Ripple network has rendered the old system of monetary transfer via Western Union or SWIFT obsolete. Currently, Ripple is centered solely on operating with banks, giving them a cost-effective and more efficient way to send real-time payments globally.
Hypothetically; Directly sending money cheaply from Japan to Nicaragua, JPY/NIO isn’t ordinarily possible. Rather, a bank or individual will normally trade JPY to US dollar and then trade US dollar to NIO.
The fees add up at each step making an expensive way to transfer funds internationally. Using Ripple, one can swap JPY for XRP (Ripple’s token), cheaply, transfer XRP to the receiver, either a person who has a bank or a Ripple wallet in Nicaragua and from there, trade XRP into NIO. Simply put, XRP is the oil that allows any currency to be easily traded for any other money on the Ripple network.
Why Are Banks Using Ripple?
Some banks like Santander, Axis Bank, Union Credit, NBAD, Yes Bank, Westpac, and UBS have embraced the Ripple platform. By using the Ripple protocol, banks can save an average of $3.76 on every payment. This denotes significant savings, considering that banks perform thousands or millions of transactions every year.
If there is one thing that attracts the interest of banks, it is how to earn more money, while keeping more money. This is why an inexpensive, real-time, global settlement network like Ripple has a brilliant future ahead, as it offers a new way to handle business that brings financial companies up to speed in the Internet age.
The Ripple team is led by Brad Garlinghouse, while David Schwartz, the Chief Cryptographer is the brains behind the scene. The company, headquartered in San Francisco and branching out all over the world, has continuously been upgrading the protocol while establishing partnerships with banks internationally.
How Do I Invest in Ripple?
While institutional investors may be able to invest directly in Ripple, most retail traders and investors are limited to investing in XRP. They can only purchase ripple currency. The Ripple currency (XRP), surged in value in 2017 when it grew from $0.01 to over $0.30 per coin. This enormous increase in value is due to both speculative interest and bank adoption. Ripple is currently the cryptocurrency with the third highest market capitalization behind Ethereum and Bitcoin.
XRP provides seamless financial transactions from any given currency to any other with relatively low fees. Any individual who receives the XRP token can then trade it for the fiat currency of their choice.
Due to greater demand, the liquidity and value of XRP increase every time any given currency is traded into XRP. In other words, Ripple is trying to turn XRP into a worldwide currency reserve of such even though it may not appear that way just yet.
However, the most comfortable and least expensive way to send value over the Ripple protocol is transferring XRP. At some point, it may not be sensible to move into any other currency, while instead, merely using XRP only for global payments. If banks and individuals all over the world turn their fiat currencies into XRP and collectively determine not to go back into fiat, the price of XRP will undoubtedly skyrocket.
The aim is to change XRP into a stable currency that doesn’t fluctuate much in value so banks would be comfortable accepting it without concern of volatility. Currently, because the XRP can dramatically change in value overnight or even in seconds, many banks out there don’t want anything to do with it. There should be further bank adoption relatively soon, as Ripple has partnered with BitGo to mediate these risks to assist banks and payment providers.
How Many XRP (Ripple coins) Exist?
Ripple holds 61 billion of the 100 billion XRP tokens in existence. With the company holding most of the tokens. Ripple has locked up 55 billion XRP with 55 smart contracts to build investor confidence. Monthly, each contract, containing 1 billion XRP each, expires throughout 54 months.
Currently, Ripple has spent around 300 million XRP a month for the past 18 months on handling expenses. This operational clarity should give doubtful investors who might be learning how to buy ripple cryptocurrency with USD a reason to think that Ripple is in the market long-term and would not yield any profit by selling off their holdings, thus plunging the value of XRP.
What Are the Advantages of Ripple?
There are some benefits that XRP token has over other digital currencies, most distinctly, Ripple is operating directly with banks.
While anyone against the banking cartel monopoly may not want to invest in Ripple, it is certain that Ripple is centered on smart business arrangements by making relations with the very organizations that dominate global finance.
Investors who want to learn how to buy ripple coin in order to capitalize on the hard work the Ripple team is dedicating to its global settlement platform are likely to see a constant increase in value on the long run by merely holding the XRP they acquired. In other words, purchasing XRP and holding it could result in ten times or even hundred times profits in the long run.
Ripple is pretty fast, with transactions authenticating in less than four seconds. Simply put, it can be used to buy everyday items, assuming that it is used by both merchants and users globally. Also, Ripple is scalable, as it automatically handles 1,000 transactions a second. It has even been proved to process as many transactions as Visa, over 50,000 transactions per second.
What Advantages Does Ripple Have Over Bitcoin?
Bitcoin is an excellent cryptocurrency, but unlike Ripple, it isn’t a quick way to exchange value. Also, the cost of sending bitcoin has skyrocketed as more and more transactions are being executed on the blockchain, while transferring XRP is still relatively cheap. Besides, unlike Bitcoin, the Ripple network doesn’t get bogged down by transactions.
The original purpose of Ripple was to create a platform that didn’t consume enormous amounts of electrical energy like the method of mining BTC. To totally bypass mining, all 100 billion XRP were “premined” that essentially has disadvantages to anyone who enjoys the benefits of mining.
Many claim that Ripple is centralized, but the Ripple team is working hard to correct that. Through validator node diversity on the Ripple Consensus Ledger (RCL), Ripple is becoming more decentralized. In fact, Ripple argues that at this point, it is more decentralized than Bitcoin.
From an investor’s viewpoint, one of the most significant benefits is that Ripple is building relationships with the banks all over the world, while many see other digital currencies like Bitcoin as competition to the traditional financial institution. In other words, rather than support cryptocurrencies like bitcoin, banks are far more likely to adopt a protocol like Ripple and its proprietary token XRP.
What Are Some Downsides to Ripple?
While the Ripple token has some tremendous benefits over other digital currencies, some would argue that it is a financial platform for making real-time international transactions.
Since the original idea of Ripple was centered on allowing individuals to make global transactions, like remittance payments, cheaply and quickly, the pivot to concentrating solely on banks was seen as a turnoff by many cryptocurrency users. Anyone who doesn’t like the Ripple company but likes the idea behind the Ripple platform may want to try Stellar, a Ripple fork from Jed McCaleb, which has more of an altruistic purpose.
As said earlier, XRP was pre-mined all at once, and Ripple owns the majority of these coins. Even though the likelihood of a sell-off is small as these coins are locked up in a smart contract, it is still something to contemplate. Simply put, the Ripple network is the central bank of XRP.
According to researchers at Purdue University, the Ripple platform has some security vulnerabilities. Nodes within the network are susceptible to attack due to its open nature, preventing some users from accessing their funds.
Many people who invested cryptocurrency because they see cryptocurrency as an escape from government control and the banking cartel may decide not to invest in XRP. However, investors or traders who are looking to amass gains and don’t see anything shady with Ripple’s business pattern have every reason to purchase XRP.
Three Simple Steps on How to Buy Ripple
Step 1 – Get an XRP wallet
The critical factor to bear in mind when storing your XRP on a wallet is to write down the secret key and keep it in a secure place.
Better still, pen down the secure key multiple times and keep it in several safe locations. Users can use this secret key to acces their wallet anytime.
Generally, the XRP wallets operate just the same way as Bitcoin wallets. For maximum security, it is best to store your XRP on a hardware wallet offline. It is worth noting that every Ripple wallet must first be funded with a reserve of 20 XRP to protect against low-level spam attacks.
Currently, Ledger Nano S is the only reliable hardware wallets for storing XRP and some other digital currencies.
Toast Wallet is an easy-to-use self-hosted digital wallet that you can use to hold your XRP. Toast Wallet for mobile on both Android and iOS platforms, and desktop on Windows, Mac, and Linux.
Rippex offers a desktop wallet for Windows, Linux, and Mac that gives users great features.
Step 2 – Buy Ripple On an Exchange
For those who are asking “What is the best way to buy ripple?” There are many you can acquire Ripple today. You can either purchase it with fiat currencies such as EUR, USD, and the likes, or trade Bitcoins for Ripple on specific exchanges.
Invest in Ripple through a trading fund
Trading platforms such as eToro don’t give users actual access to your assets, and they can’t send coins from the eToro platform to other people. The only thing that can be done on the platform is to buy and sell XRP for fiat currencies like EUR and USD. Simply put, this platform is useful if you only want to make speculative trading on the price. This approach is only valid if you are not a resident of the United States.
Buy Ripple with Fiat Currency
For those who don’t already own Bitcoin, the best way to buy Ripple is to obtain it directly via paypal, credit/debit card or bank wire transfer.
CEX.io, allows you to purchase XRP via your credit card or wire transfer quickly. CEX is a cryptocurrency exchange based in London, United Kingdom, and has been around since 2013.
It is also possible to purchase XRP with a bank wire transfer on Bitstamp. After creating an account and following their KYC (Know Your Customer) policy, it is easy to send EUR via a SEPA transfer or US dollar by a bank wire transfer. Your fiat currency can be traded for Ripple directly on the Bitstamp platform as soon as the transfer clears. Bitstamp also lets users trade Bitcoin directly for XRP or move funds onto the platform with a credit card payment.
GateHub is another cryptocurrency exchange platform that supports Ripple. First, create an account on GateHub and go through the necessary verification process to comply with their KYC policy. GateHub accepts bank transfers and SEPA transfers, although bank transfers attract a fee of $15. After getting USD or EUR in your trading platform, it can be traded for Ripple on the GateHub trading platform.
Buy Ripple with Bitcoin (trade BTC for XRP)
The consensus all through the Ripple community is that the least expensive way to buy XRP is by purchasing bitcoin from Coinbase or another cryptocurrency provider first. Then, bitcoin can be transferred to many exchanges and traded for Ripple.
The most comfortable way to trade Bitcoin for XRP is by instantly exchanging it on Shapeshift or Changelly.
Kraken is another renowned exchange that lets users trade bitcoin for XRP.
XRP can also be bought with BTC by trading it on Bittrex, and Poloniex, and many other exchanges.
Japanese clients can use Bitbank or Coincheck to purchase Ripple.
Clients located in Mexico can buy XRP on Bitso.
Individuals based in South Korea can purchase XRP on Coinone or Korebit.
Step 3 – Withdraw your XRP to your wallet
Leaving your XRP on the exchange platform from which you bought them is not a good idea. This is because you don’t actually control the private key for your coins and therefore they are not really yours.
No matter the platform from which you got your Ripple coins, remember to withdraw them into your personal Ripple wallet that you have the private keys to. After the transaction has been confirmed, you’ve successfully finished the process of obtaining Ripple.
Is Ripple Worth Investing in?
Ripple will likely appeal to conventional banks during the next couple of years, as they provide a global settlement network that facilitates real-time payments globally while lessening transaction fees.
Anyone who buys the proprietary digital currency, XRP, stands a chance to earn huge profits on their investment if Ripple keeps making progress in the banking sector. While fleeting, the concept of the Ripple Token becoming an established global reserve currency is very appealing to investors.
Even though Ripple token has grown in value significantly in 2017, It is safe to say this is just the start of its ascent. However, as always, where there is an excellent reward, there is also high risk involved. Like we always say, please make sure to invest responsibly.