What is Ripple (XRP)?

Ripple is a special case in the crypto world. It's important to distinguish between two things:

  • Ripple is the private US company that develops software for banks and financial institutions.
  • XRP is the digital coin that runs on the decentralized XRP Ledger (XRPL).

Ripple's main goal is to replace the outdated, slow, and expensive SWIFT system for international bank transfers. XRP serves as an extremely fast and cheap "bridge currency" to exchange currencies like the Euro, Dollar, and Yen in seconds.

How Does the XRP Ledger Work?

The XRP Ledger is not a classic blockchain like Bitcoin or Ethereum. It uses a unique consensus mechanism that makes it extremely fast and efficient.

  • No Mining: There is no energy-intensive mining. All 100 billion XRP were created from the beginning.
  • Consensus Protocol: A group of trusted validators (servers) reconciles transactions every 3-5 seconds. If over 80% agree, the new state of the ledger is confirmed.
  • Extremely Fast & Cheap: A transaction costs a fraction of a cent and is final in under 5 seconds.

Why is This Important?

Ripple and XRP take a different approach than most cryptocurrencies: they aim to improve the existing financial system, not replace it.

  • Partnerships with Banks: Ripple works with hundreds of financial institutions worldwide to make cross-border payments faster and cheaper.
  • Clear Use Case: While many cryptos are still searching for their purpose, XRP targets a very specific and huge market: global payments.
  • Legal Clarity: After a long legal battle with the U.S. Securities and Exchange Commission (SEC), Ripple has achieved relative legal clarity in the US, which is a major factor for many investors.

Milestones of Ripple

Founding of Ripple Labs

The company is founded to solve the problem of slow and expensive international payments.

XRP is Created

The 100 billion XRP are created, and the XRP Ledger is launched.

The SEC Lawsuit

The U.S. Securities and Exchange Commission sues Ripple, alleging that XRP is an unregistered security. A years-long legal battle begins.

Historic Court Victory

A U.S. judge rules that the sale of XRP to retail customers via exchanges does not constitute an offer of securities. A landmark ruling for the entire industry.

How can I buy this coin?

The process for buying XRP or other established cryptocurrencies is always very similar. We have explained the easiest method for you step-by-step in our Start Guide.