A Beginner´s Guide to Buying, Selling, Using, and Mining Ripple:
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With all of the technology around today, it’s interesting to see what areas of our life haven’t quite caught up with the times. One of the top examples of this is the experience of sending money. We can send information, photos, data, and music in the blink of an eye. But when it comes to money, well that takes much longer. Up to 3-5 days longer to be exact. It’s this issue that one cryptocurrency, Ripple is out to solve.
Ripple (XRP) is a cryptocurrency that enables the power of blockchain to send money globally in real time. It’s designed to be utilized by financial institutions so that they can process the payments of their customers reliably and instantly. For example, XRP can be used by banks to source liquidity in real time and it can be used by payment providers to provide lower foreign exchange prices, quicker payment settlement, and expand influence in other markets.
As a cryptocurrency, Ripple boasts impressive credentials. It has an extremely fast processing time, running at only four seconds. That’s blazing fast compared to Ethereum (ETH) which is processed at 2 minutes, and speed of light fast compared to Bitcoin (BTC), which is processed at over an hour per transaction.
The definition of a cryptocurrency is an alternative form of money that is based on blockchain. A blockchain is a distributed ledger that records all of the transactions made with the coin across an open source and decentralized network. All of the approved transactions are placed in blocks on the chain. Once approved, they are logged in sequential order and are unalterable, meaning the information is secure and safe from theft. Each cryptocurrency operates through a token. In the case of Ripple, their token is XRP. These tokens can be bought, sold, traded for and used as an investment. There are many helpful videos and websites that further define Ripple, like Reddit.
Ripple can be purchased both by individuals and institutions. Individuals can purchase XRP on a number of different exchange sites like Kraken and Bitstamp. Kraken is an easy site for buying XRP. First, create an account with the exchange site. After verifying your account, you’ll need to deposit funds into your Kraken account. Through Kraken, XRP can be purchased directly with USD. This can be done with cash or credit card.
How Do I Turn Ripple Into Cash?
When the time comes to cash out on your XRP investment, it’s as easy to sell XRP as it was to buy in the first place. Kraken can be used again, this time to convert the XRP back to USD or other select fiat currencies. Another way to turn Ripple into cash is to convert it to Bitcoin, then use a site like Coinbase to transfer your Bitcoin into your preferred fiat currency. Finally, the trip to the local atm will complete your withdrawal.
Ripple is designed to be used as a money payment system, specifically for global payments. Banks, digital asset exchanges and payment providers can all be connected through RippleNet. The more financial subsidiaries that join RippleNet, the more beneficial it is for all. Banks, for example, will be able to expand their reach into untapped markets. When a bank uses Ripple, it allows an easy user experience for a customer to send money to another individual whose bank also uses Ripple, even across the globe. A XRP Ledger Gateway handles all of the customer KYC and risk checks, before the money is even sent. All of the customer information is encrypted, and never posted to the Ripple network. Ripple also handles all of the processing fees as well as exchange rates, making for a quality user experience with settlement in seconds.
Ripple can also be used as an investment. By investing in the Ripple token, XRP, users are buying in on a form of currency that will either rise or fall in value depending on the supply and demand. As the price for the coin fluctuates, so will it’s exchange rate into other currencies. This provides investors the opportunity to capitalize on the success of the coin, as they can trade it back into whatever fiat currency was used to purchase the coin. XRP is placed in your digital wallet, securely storing the coin.
Mining a cryptocurrency is where users devote their computer’s processing power to help process the transactions made by a coin. Typically, when a successful mine takes place, new coins in that cryptocurrency are created and the minor is paid with some of those coins. Miners use calculators run on a GPU to complete the process. That being said, Ripple, like many other cryptocurrencies cannot be mined.
Miners are interested in the profitability of mining a coin. Because Ripple can’t be mined, 100 billion XRP were created at the inception of the project. Also, each time a transaction takes place, a few coins are destroyed. This actually helps bring up the cost for the coin, as the less supply that is in existence, the higher the demand will be for them. In turn, the more popular a coin becomes, the more the market cap for that coin will grow.
Not only is Ripple fast, but it also is scalable, as the coin is able to handle 1,500 transactions per second around the clock. Not only is Ripple able to handle the transactions now, but it’s designed to handle even more as the coin grows; 48,500 more to be exact. Ripple boasts Visa like scalability, once again blowing Ethereum and Bitcoin out of the water. Thus, as the price chart for this coin grows, there’s no need to be concerned if the coin’s infrastructure will be able to handle the growth.
Ripple is a very unique cryptocurrency. While some coins thrive on individuals buying and selling their token, Ripple thrives when banks and payment providers use the Ripple software as the underlying system which processes global payments. It provides a bank with a user-friendly system that brings global payments into the 21st century and up with the times. Ripple is already at the top of the chart in many categories. Time will tell how many more banks and financial institutions adopt this revolutionary software.