How Ripple Works and Why It's Surging
XRP is the latest cryptocurrency to surge in value. Here's why.
Ripple is just the latest digital currency that uses blockchain encryption to gain prominence over its rising value.
Released in 2012, Ripple provides a “basic infrastructure technology for interbank transactions — a neutral utility for financial institutions and systems.” It’s designed to make it easier to send money across borders between people with different banks, quickly and easily. It’s a “real-time gross settlement” system, which means it happens fast (as in “real time”), it happens in full (“gross”), and there are no give-backs (“settlement”).
See also: Is Ripple Coming to Coinbase?
Last week, Ripple — whose cryptocurrency goes by the name XRP — became the second most valuable cryptocurrency on the internet, topping Ethereum. On Tuesday, its market cap was $92.3 billion, far exceeding $84.7 billion for Ethereum. (Bitcoin was at $253 billion at the same time.) It had the biggest 2017 of any cryptocurrency, surging in mid-December from around $0.25 a coin to its current valuation of $2.38, which is still low enough to get in early for anyone who’s watched bitcoin’s dramatic rise.
The video above was released by Ripple in 2016, explaining how it enables cross-border payment transactions, using XRP, between banks. Ripple wants to partner directly with banks, and in recent months it has partnered with American Express and Santander.
Ripple boasts a faster transaction time than bitcoin — a few seconds instead of more than a hour — which means transfers can happen easier and more frequently.
The surge has been celebrated by the people who work at California-based Ripple.
It’s also made people who own a loot of XRP very rich, very fast.
See also: How to Buy Ripple in 4 Steps, the Cryptocurrency Surging in Value