Ripple XRP More Than Meets the Eye
The Ripple XRP is a popular cryptocurrency that ranks third in overall market cap in the world behind bitcoin and Ethereum. The Ripple is also a money transaction system and its currency XRP is based on an open-source consensus protocol with a distributed ledger for recording the transactions.
What is different about XRP?
The XRP is very unique in the current world of cryptocurrency and especially it differs from the bitcoin and Ethereum when it comes to the philosophy at work behind the scenes. It is based on an ancient money transfer system that has been in place in Arabia and Central Asia for centuries and especially has been associated with the jews. It is called hawala and is still used in some parts of the world.
Ripple and Hawala
The essence of the hawala system is that it involves money transfer between two parties based on trust. A guy A wants to send money to a guy B anywhere in the world. He goes to his local hawala agent and gives him the money. The hawla agent then contacts another hawala agent near B and asks him to give money to B after getting a secret passcode in return that A has shared with B. Now A’s money has reached B but no actual transfer has occurred between A and B. Now the Hawala agent of A owes money to Hawala agent B.
Now replace the hawala agent with a ripple gateway. What happens is that a person A deposits money and converts it into ripples. Now these ripples are sent to the Ripple Gateway near B and B cashes those ripples for the same amount of fiat currency or any other money.
The Ripple’s uniqueness is that the system can be used to send any physical good just like money based on this crypto-hawala system. You can send goods, commodities, fiat currencies and even other cryptocurrencies based on Ripple. It is truly a unique way of doing things and due to this approach, the XRP has made held solidly to the third most market capped coin spot for some time.
Some people do find it really hard to understand but you need not worry. All you need to understand for trading purposes is that XRP is a cryptocurrency just like any other and its behavior is really different from bitcoin and Ethereum.
Tokens available in the market right now
More than 100 billion XRP coins were released by the creators in a single go, making it the biggest token release in the world. 20 billion were kept by the Ripple company itself and the rest were given out to the public on various rates. The current price of XRP is $0.12 making it easily the third largest cryptocurrency in the world.
Here is the history of the XRP.in one chart.
Can XRP reach $1 valuation?
As you can see, once it reached a peak value of $0,42 and some traders thought that the XRP could reach the $1 mark. But, the currency fell soon afterwards and now it seems to be stabilizing around the $0.15 mark. While we would love the fact that the Ripple XRP increases its worth but $1 might be a lot to handle right now.; For $1, the entire market cap would have to shoot to $100 billion which is like 70-80% of the total market cap of all crypto and nearly double the bitcoin market cap. Certainly, this is not impossible but I don’t see XRP doing it alone. For it to increase to $1, other cryptocurrencies including bitcoin and Ethereum would surely see their worth increased by many times over.
Can the XRP be mined?
The XRP is a pre-mined coin so it cannot be mined. It has been criticized for the lack of mining opportunities. Ripple Labs continues to receive some flak for retaining 20% of the Ripple coin. Many consider it a very high percentage. Due to this limited number of XRP coins, the currency may continue to flourish or at least hold its ground in the future if crypto prices fall.