The basics of crypto trading
Ripple is a demanded cryptocurrency for fast (only 4 seconds) and simple transactions which can become a framework for a worldwide banking system in 5 years. The token has the third global position according to its capitalization.
Ripple is a platform with its own system of bridges and gates which doesn’t implement the blockchain technology which is the basis of Bitcoin. The developers themselves position their project as an add-on to BTC which will be applied to perform an active exchange of digital assets in future.
Despite some distinctions with Bitcoin, Ripple also has features in common with it. The major one consists in a full decentralization of the virtual architecture and availability of an internal token on the platform.
An idea of the project appeared back in 2004. At that moment development of a cryptocurrency wasn’t even mentioned. Ryan Fugger (a Canadian programmer) announced his project and existing groundwork. It resulted in a whole electronic payment system RipplePay in 2005. The following 7 years the platform hadn’t been attracting any specific public interest.
Only in 2012 the idea interested the founder of the MtGox exchange – Jed McCaleb. Financial investments and modifications of the system itself triggered emergence of a brand new platform, thanks to which Ripple (XRP) has been ranked among three most demanded cryptocurrencies in the world according to its capitalization.
A significant feature of the system is the instant emission of all tokens in total amount of 100 billion units. Moreover, 50 billion was concentrated in the developers’ hands at the moment of emission, which led some investors to believe in existence of a powerful leverage influencing the market and absence of the coin’s decentralization. The developers claim that these funds are being used in small amounts for development of the ecosystem. The majority of the tokens cannot be sold or exchanged due to restrictions in the form of smart contracts.
Jed McCaleb has been engaged in the project not long at all – already in 2013 he began to develop his own fork called Stellar which is now one of the main competitors of Ripple. A year later the investor decided to sell his share of tokens, but he couldn’t do it because his account had been frozen. Ripple mostly attracts major players of the financial sector. They use the coins to conduct fast, secure and simple transactions. Cross-border banking operations, deals and nettings are performed through them. XRP is used especially intensively by banks.
Hype surrounding the coin and the system in general is positively affecting the XRP exchange rate and opportunities of its further development. Investors describe the token as one of the reliable and stable means not only for keeping savings, but also for multiplying them. Users specify the following features among positive qualities:
The coin also has some particular disadvantages which discourage some users from buying it. The most significant one is the possibility of a single or a mass blocking of purses. The negative features are: a large amount of coins in the developing company’s disposal and a too high level of centralization.
For the first time the coin was officially offered publicly in August, 2013. At that moment the Ripple exchange rate was 0,0059 USD.
The most successful period for Ripple so far has been 2018. Maximum price at the level of 3,65 USD was recorded in January. The rate appeared to be 619 times higher than that at the moment of the coin initial offer. Today the XRP exchange rate equals 0,455325 USD.
A daily trading volume exceeds 410 million USD. The coin takes the third place among all global cryptocurrencies according to this rate leaving behind such competitors as Litecoin, Bitcoin Cash and EOS.
The total capitalization reduces gradually as the system “consumes” some part of the coins against the fee. Judging by forecasts of experts, it should only fuel a demand for the token and prevent inflation.
Many analysts predict a good future for XRP. The forecast is quite optimistic. Investors point out that the cryptocurrency hasn’t utilized all its potential yet. If players hadn’t exchanged it but conducted transactions using Ripple directly, the exchange rate would have become more stable and less volatile.
The news about cooperation between the developing company and major banks strengthen the token’s positions. 61 Japanese and 2 North Korean banks are already willing to use Ripple in a pilot mode for conducting transactions. The more financial institutions are involved into the ecosystem, the higher will be the price of its base coin.
It’s expected that already by the end of 2018 the price of the XRP will have increased up to 4-5 USD mostly due to activity of speculators. By 2020 the token will have probably been used universally, and in another 5 years it may become a foundation of banking transactions, driving out SWIFT. Though some sceptics tend to think that soon the interest in the coin will decrease and it will become useless.
All coins in the Ripple ecosystem have been issued simultaneously, so their mining isn’t possible. The only way to get a token is to buy it. The easiest ways are buying it through exchangers or cryptocurrencies exchanges, especially as the coin is supported by many major players. A specific way of mining is proposed by the developers themselves. In order to take part in it a user should join scientific researches and make calculations within them or perform other operations. A reward in internal currency is provided for it.
A good choice for long-term keeping of XRP is a purse which can ensure safety and security of funds. There is no official “vault” from the developers – their purse has been closed. Nevertheless, coins can be kept in other hardware or web purses.
It’s also possible to earn using Ripple. A great potential is a good opportunity to make some real money in a long-term perspective. Earnings can be generated on active trades via the exchanges and exchangers by speculating on volatility of currency rates.
The 3rd largest cryptocurrency - Ripple - sold over $251 million in XRP in the Q2 of 2019. The information has been taken from the company report published on July 24.
According to the provided data, in the Q1 of 2019, the company sold around $169 million and beaten the record in the next 3 months. By analyzing the information taken from the report, market analysts came to the conclusion that XRP sales raised by 48% approximately.
In relation to its quarterly sales of the XRP, the document states that the Ripple company will further lower its future token sales. Besides, Ripple has also noted that it restricted XRP sales during the Q3 due to potentially inflated trading volumes. Thus, the company is going to temporarily pause its programmatic sales and set limits on institutional sales.
In June 2019, two Latin American banks announced the testing of the Ripple xCurrent solution for international payments and transfers - Banesco Panama and Scotiabank Chile. It is reported that Banesco Panama works closely with regulators from several other countries in the region in order to make sure that the solution meets the requirements of regulators.
This news is a good sign for Ripple, let us remind you that earlier this month the company has made a deal with MoneyGram, which still has over 200 million clients worldwide. Once the deal happened the price of XRP rose up to 7% from the initial one. Nevertheless, not all users share the point of view that making this deal is a good sign. There is another idea which states that this action was the only way to keep Ripple afloat and that MoneyGram’s position on the market was questionable for a long time.
However, there is some sort of controversy surrounding Ripple nowadays, as the CEO of the Western Union company made a statement demanding Ripple to admit that their commissions are much higher than they claim.