The Complete Guide to Understand ‘What Is Ripple’

Recently, investor demand for Ripple's native coin, XRP, has been very high. In the last few days, the coin has climbed by about 25%, with a 160% increase in volume, putting it in sixth place among all crypto assets in terms of valuations, ahead of Cardano and Solana. 

Yet, many enthusiasts are still unaware of what Ripple is. And that's what this tutorial is for. This tutorial will give you a glimpse of various important underlying concepts of Ripple.

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What Is Ripple?


  • Ripple is a payment settlement system and currency exchange network that can handle transactions worldwide. 
  • Ripple was built to be a SWIFT (a leading money transfer network) successor or to replace the settlement layer between large financial institutions.
  • Because of the network's rapid ability to confirm that it successfully completed a transaction, it serves as a trusted middleman between two parties in a transaction. 
  • When users use the network to make a transaction, the network takes a modest charge in the form of XRP, a cryptocurrency.

What Is XRP?

  • McCaleb and Britto would form Ripple, employing XRP to enable Ripple network transactions.
  • You can buy XRP to use as a form of investment, as a medium of exchange for other cryptocurrencies, or to finance Ripple network transactions. 
  • XRP's blockchain, in particular, differs from that of most other cryptocurrencies. For example, 
  1. Other cryptocurrencies allow access to their transaction ledgers and verification procedures to anyone who can swiftly solve challenging equations. 
  2. On the other hand, since most ledger holders must consent to the verification before a transaction can be added, ripple transactions are secure.
  • Additionally, the consensus protocol used by the Ripple network, which uses XRP, is fairly centralized. 
  • Anyone can download its validation software, but its node lists let users validate transactions based on the parties they think they can trust.

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Working of Ripple

  • The XRP crypto uses a consensus protocol to confirm transactions.
  • Validators compare proposed transactions to the most recent version of the XRP ledger to determine whether they are valid. 
  • The majority of validators must accept a transaction to be verified.


How Is Ripple Mined?

Ripple (XRP) is created using a crypto ledger akin to blockchain technology and federated by financial institutions and payment processor networks. 

  • While it is true that miners cannot mine Ripple (XRP), it is technically viable to do it using other cryptocurrencies. 
  • Mining Bitcoin (BTC) and Ethereum (ETH) and then exchanging the mined coins for Ripple (XRP) through exchanges is one of the most effective methods for mining XRP.


Ripple vs. Bitcoin



The consensus protocol used by XRP confirms transactions.

Bitcoin uses mining to certify transactions and distribute new coins.

Its transactions are instantly confirmed and have very cheap transaction fees also, the user is charged a small amount of XRP each time a transaction is completed on the Ripple network.

Considering how difficult and expensive mining is used in the cryptocurrency, its transaction confirmations can take several minutes and are connected with substantial transaction fees.

At its launch time, one billion XRP was pre-mined and progressively distributed onto the market by the company's major investors.

The supply of Bitcoin is limited to 21 million, which means there will never be more than 21 million Bitcoin.

A smart contract controls the release of XRP. According to an in-built smart contract, Ripple is expected to distribute a maximum of 1 billion XRP tokens per month; the current circulation is 55 billion.

The network receives newly released bitcoins. Network speeds and the complexity of the algorithm used to manufacture coins mostly influenced their supply, and they have no fixed release date.

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Pros and Cons of Ripple



XRP transactions are inexpensive and quick.

The Ripple consensus methodology is perhaps less safe than other cryptographic transaction processing systems.

Financial institutions already use the payment network of Ripple.

Ripple's financial partners primarily use RippleNet rather than the XRP cryptocurrency.

Small company owners and individuals can utilize XRP to make safe money transactions.

Because a private corporation administers it and because of the SEC litigation, Ripple has sparked debate.

It may be used as a bridge currency for transactions between different currencies.

In the United States, buying XRP is quite challenging.

How to Use Ripple or XRP?


  • XRP can be used in the same way as any other digital currency, for transactions or as a possible investment. 
  • Other transactions, such as currency exchange, could be implemented using the Ripple network. For example, 
  • You can first exchange your US dollars for XRP on the Ripple network and then use those funds to purchase euros rather than dealing with the currency conversion directly through a bank or money-changing exchange. 
  • This can be a much quicker and less expensive choice than paying the high fees that banks and money transmission companies may demand.

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How to Buy Ripple?

To purchase Ripple's XRP cryptocurrency, create an account on an exchange that offers it for sale. Buy it next using one of the accepted payment methods on the exchange. Here are a few platforms to get XRP: 

  • KuCoin
  • Uphold
  • Coinmama

Is Ripple a Good Investment?

XRP is a risky investment that should not be undertaken lightly.


However, it would be wise to buy in XRP if you think Ripple will be a successful payment system. Be careful not to gamble with funds you cannot afford to lose.

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In this tutorial, you learned what is Ripple and its following concepts like what is XRP Coin, the Working of Ripple, how it differs from Bitcoin, what are the pros and cons of Ripple, and how exactly to buy Ripple.

Whether you're an experienced Blockchain developer or just aspiring to break into this exciting industry. To learn more about Cryptocurrencies and Blockchain, enrolling in Simplilearn’s Blockchain Certification Training program helps you with all levels of experience to learn more about cryptocurrencies like Ripple, Blockchain, and its technology.

Do you have any questions for us? Please feel free to drop them in the comments section of this article; our experts will get back to you as soon as possible.

About the Author

Shyamli JhaShyamli Jha

Shyamli is a Senior Research Analyst at Simplilearn. She is proficient in Blockchain and Cryptocurrency, Cloud Computing, Android Development and other coding languages like C, C++ and Java.

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