XRP is the digital asset representing transfer value within the Ripple network. The ripple network is commonly dubbed and known as the RippleNet. It is founded and managed by Ripple Labs, a U.S based tech enterprise. Ripple connects banks, digital assets and payment processors to make global money transfers easy. It accounts for cost-effective and real-time money transfer solutions. To achieve that, it employs xRapid, an on-demand, and a liquidity solution. It enables financial establishments to use XRPs as a bridge currency between FIAT currencies and digital currencies during offshore payments. XRP and xRapid works based on its patented Ripple Protocol Consensus Algorithm (RPCA).
Ripple works in the simplest of ways. A sender transfers money to a receiver in another country through local banks. These local banks are financial institutions that use Ripple solutions. During the transfer, the money is exchanged to XRP to ensure the necessary liquidity. It powers the final payment and the receiver gets funds in local currency. Information of ripple accounts and XRP transactions are stored in a distributed ledger known as XRP ledger. The ledger is operated by thousands of independent validating nodes. The transaction records are constantly compared between these nodes, which may belong to banks as well as individuals. Nevertheless, Ripple advises participants to use identified nodes from Unique Node List to validate their transactions. The goal of consensus between nodes is to apply the same set of transactions in their respective ledger. Transactions agreed upon by majority in UNL are considered valid. For simple understanding, transactions require agreement from large group of trusted people for successful validation.
xCurrent and xVia supports XRP
XRapid does not offer enterprise or corporate solutions. Ripple has xCurrent for enterprise solutions and xVia for corporate solutions respectively. However, both these solutions support XRP as much as other FIAT or cryptocurrencies. xCurrent powers instantaneous settlements and end-to-end tracking between users of RippleNet. It uses Interledger Protocol (ILP) that connects different ledgers, unlike XRP ledger. The four major components in xCurrent are Messenger, Validator, ILP ledger and FX ticker. Similarly, xVia powers payment originators and corporates to make global transfers via RippleNet, using an API based Standard Payment Interface. Rich information such as Invoice or Payment Status comes along with the payment.
Fundamentals and Future of XRP
To put it in the most straight forward way, XRP price is expected to boom in coming months. In fact, XRP price has been appreciated by several tens of times from its base price of $0.01. It was the story, when XRP didn’t have any utility. Imagine the steeper rise in pricing when XRP doubles up as a utility coin. The limited supply of XRP makes it a deflator coin. The lost accounts from bad memory or demise make supply even more limited. There is no way there is going to be more than 99,990,976,125 XRP coins. In addition, household names like MoneyGram have started including XRP in many corridors. Moreover, Western Union with a market of $8 billion is testing XRP for the second time.