The Gen Z generation is super digital and they are dropping the traditional finance systems and opting for the ‘future of finance’ – cryptocurrencies. More than half of young millennials have spent their considerable amount of savings on digital currency including digital coins, meme coins, Non-fungible tokens, and Bitcoin.
That said Bitcoin needs no introduction, from being the longest-running cryptocurrency to the most expensive to purchase. It has achieved cult status in a very short span. Similarly, Ripple is the world’s third most valuable virtual currency behind Bitcoin and Ethereum.
So, anyone who is deciding to put money on this Coin or wanted to know is it worth investing in XRP 2021? Fundamentally must understand what Ripple is all about, ripple coin and ripple lab. Let us dig deeper into the pros and cons of investing in XRP!
First and Foremost, What is Ripple?
In simpler words, it is a cryptocurrency (XRP) that is designed to work consummately on the XRP ledger. It is also acclaimed to be an ineffable payment network for financial transactions. Throwing some luminescence on its history; it was instigated by the combined efforts of Chris Larsen (business executive and angel investor) & Jed McCaleb (American programmer and entrepreneur). Ripple finally made it to the market in the year 2012 through the US-based conglomerate, Ripple Labs Inc.
Delving deeper; albeit, Ripple is known to practically exist in three distinct genera, but all are interrelated in some form or the other. Here are its three categories:
- The Ripple Network
Also called by the moniker RippleNet, the network furnishes a digital payment platform for accomplishing financial transactions.
The crisp answer; any cryptocurrency that functions on the famous Ripple Network!
- Ripple Labs
The establishment that in actuality braces the Ripple Network, XRP, and bestows several other Blockchain payment solutions, finally allowing slicker operations for financial institutions!
In continuation, the notion of bringing Ripple into its real existence is primarily to simplify the current modality of financial payments, which was infamous to be convoluted previously. Consequently, the preceding compound system had serious flaws leading to bling payments, long waiting times, and delivering a fly-by-night platform.
To vanquish these inconsistencies, it was introduced providing the fairest and square alternative. It eventually facilitated cross-border payments that could be processed at a drop of a hat without any hassles and with 100% security.
Then, what do you mean by XRP?
As already stated above, XRP is a cryptocurrency that runs on the Ripple Network. Anyone is privileged to snap up these XRP’s for investment, as a coin to be employed for exchange with other cryptocurrencies, or can also be wielded to finance transactions on the Ripple Network.
How is XRP contrasting from other Digital Currencies?
Albeit termed as an altcoin, but it differs from the likes of LTC, ETH, and others in a myriad of ways. Many factors contribute to its quirkiness:
- It doesn’t execute on Blockchain
Bitcoin and other cryptocurrencies boast to work on Blockchain technology. However, unlike them, XRP utilizes the distinctive one in the form of the Ripple Protocol Consensus Algorithm (RPCA).
- XRP is decentralized
There have been persistent debates on whether XRP is centralized or decentralized. These discussions in actuality have only created doubts among people. This will clear their skeptics: XRP is decentralized. It employs a peer-to-peer decentralized network, pinning its hopes on nodes to propel transactions through a voting system.
- These cannot be mined
If a train of thoughts to mine XRP is captivating your mind, you must get over them quickly. You aren’t simply allowed to do this. XRP is already pre-mined and capped at 100 billion tokens.
Should Buying Ripple Is Worth or Not?
The volatile crypto market is unpredictable. With each investment having its share of uncertainties, XRP is no exception. However, XRP is still a good investment for a thematic investor to diversify their crypto portfolio.
Although it is recommended before investing in ripple, investors need to calibrate the advantages and disadvantages. Plus, do make sure you invest the money that you can afford to lose!
Here we have top reasons why investing in Ripple XRP is worth every penny!
- Unique Technology
As previously mentioned; XRP has its unique concept, technology, and execution. It doesn’t operate on Blockchain and instead works on RPCA (Ripple Protocol Consensus Algorithm).
- Bank Friendly Crypto
More than any other digital currency, a plethora of banking institutes trust and appreciate Ripple. Also worth noting, top financial players such as Axis Bank, MUFG, SEB, and BBVA have genially accepted the ripple technology to perform cross-border transactions and remittances, etc. Therefore, this exceptional acceptance gives an edge to XRP over Bitcoin, creating overall positive consequences for the token.
- Highly Scalable
Ripple growth potential is high as the coin is not directly affected by the market volatilities. In addition to this, unlike other cryptocurrencies, the ripple transactions are carried out in consensus ledgers via nodes. Also, the market cap value estimated for XRP is close to $60 billion, which signals that investors have their trust in the company.
The transaction time of XRP is faster than any other cryptocurrencies available in the market. Also, the transaction fee is very low for ripple, making it an affordable high worth virtual currency for investors.
Furthermore, in 2018 ripple was at the all-time high price of $3.18. Since its launch, there has been a steady increment in the ripple price and it’s predicted that it will keep on augmenting consistently. Plus, with more and more mainstream acceptance, trading ripple is a low-risk option that will provide a good ROI in the future.
Here we have some cons you should know before placing your bet on Ripple
- Possession Of XRP coins
Around 64 percent of XRP coins are owned by the Ripple Company only- implying the price can be controlled by them. And this goes against the philosophy of cryptocurrencies – where coins are mined and exchanged between unknown users.
- SEC Lawsuit
As mentioned earlier, Ripple decides when to release the XRP coins in the market – for the same reason, the SEC filed a lawsuit against the company. They stated that Ripple should have been registered as a security. As of now many exchange platforms such as Binance, Coinbase, OSL, and eToro have delisted XRP.
- XRP coins are Pre-mined
Only 21 million Bitcoins will ever exist, the limit for Ethereum is endless. However, XRP coins are already mined and stored in escrow. To add, XRP’s are capped at 100 million, out of which 46 million tokens are already in circulation. There is a possibility that a huge amount of coins may be released untimely, which could hit the XRP coin value.
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