Of all the digital coins launched in the crypto space, only a few managed to stay relevant over the years, and XRP is one of them. XRP is the cryptocurrency launched by Ripple, and many people use these two terms interchangeably. There are around 14,000 digital tokens in the market, out of which Ripple managed to secure its position in the top ten cryptocurrencies list. At the time of writing, the market cap of XRP is around $ 45 billion, making it the 7th largest cryptocurrency around the world in terms of market capitalization.
This valuation has made many want to buy Ripple in India, but is having a high market cap enough a reason to include a cryptocurrency in one’s portfolio? Even though the first cryptocurrency was launched in 2009, the crypto landscape is still evolving and unfolding, which calls for a thorough understanding of any digital currency before making an investment decision. Whether you’re a crypto enthusiast or a seasoned investor, knowing the following facts about Ripple will help you make an informed investment decision.
Designed to Improve Cross-border Payments
One of the main reasons behind a coin’s fall is the lack of vision and purpose of launch. If a digital currency has been randomly launched with no roadmap in mind, it is bound to fail. Luckily, it is not the case with Ripple. It was created exclusively for financial institutions and payment service providers. Ripple or XRP helps financial institutions like banks and others transfer money across borders without having a pre-funded account in the transfer country.
Another great attribute of XRP is it doesn’t charge a hefty transaction fee, making it desirable for people who always look for reasonable transaction charges. It is this reason that made various top banking institutions like TransferGo, American Express, Banco Santander, Bank of America, and others sign up to use Ripple. Currently, Ripple is being used by over 300 partner financial institutions to make faster, secure, and affordable cross-border transactions.
XRP Transactions are Faster & Cheaper
Speed and transaction costs play a significant role in cross-border transactions, especially when the number of transactions is in bulk. A single cross-border transfer can cost financial institutions a massive transfer amount. It can also take anywhere between two to five working days for the amount to get credited, depending on the country where the amount is being transferred. XRP aims to remove these shortcomings for the good.
Financial institutions that use XRP for cross-border transfers can get the transfer done in a matter of a few seconds. XRP has an average transaction settlement time of 4 seconds, which is way less compared to the traditional transfer means. Coming to the transfer cost, a standard Ripple transaction costs around $0.00001, which is super cheap for cross-border payments. Also, you can make around 1,500 transactions every second, making it easy to scale to mass-level transfers.
Aims to Become a Bridge Between Different Fiat Currencies
While other cryptocurrencies like Bitcoin aim to become the future currency by replacing the current financial system, XRP aims to facilitate easy value transfer from one country to another. For example, if you own a company in India and have taken services from a US-based service company, you can use XRP to make instant value transfer, which will never be possible the traditional way.
Generally, people or companies take the help of banks or local payment providers for making cross-border payments. It requires these organizations to have a pre-funded account in the country where the transfer is being made. The entire process is time-consuming and expensive. XRP aims to remove these problems from the root with its instant, effective, and affordable cross-border payment facility.
Easily Available on Leading Exchanges
As XRP is among the top ten cryptocurrencies trending worldwide, it is easy to buy and sell them on all leading exchanges. You can create a KYC-verified account on a well-known crypto exchange if you haven’t already and purchase some to include in your portfolio.
If you are planning to create an account on a new crypto exchange, make sure you create one that charges lower conversion charges on cashing out 1 XRP to INR or more. The wide acceptance of XRP on all crypto exchange platforms make it easier to buy, which is another reason to include some of this cryptocurrency in one’s portfolio.
XRP is Secure & Sustainable
All the XRP transactions are recorded in an XRP ledger, which is resilient and resistant to any attack or failure. A reliable team of full-time engineers and a community of trusted validators work hard to maintain the ledger, and of course, keep it secure. Besides being secure, XRP also boasts of its sustainability for all the right reasons. If you compare it with other cryptocurrencies like Bitcoin, you’ll find that the latter is created using constant mining, which requires a lot of electricity.
It is estimated that generating one Bitcoin can cost electricity that could power 3.67 US houses a day, which is not the case with XRP. You cannot mint XRP, and all the cryptocurrencies in supply or available for distribution are already created by Ripple. If you’re someone who always sides with things that are sustainable, you would love adding XRP to your portfolio.
Are You Ready to Get Some Ripple?
Now that you have a pretty clear understanding of Ripple, you can decide if you want to purchase it or not. Don’t depend your investment decision entirely on the currency’s market capitalization or volatility, as no digital coin is safe from price fluctuations. As the number of financial institutions partnering with Ripple is increasing, its dream to replace SWIFT is not far away. So make sure you invest in XRP before its price skyrocket in the coming years.