A US-based technology company Ripple Labs Inc. introduced Ripple which is a currency exchange system. XRP is a token that enables the transfer of values within the Ripple network. The value of Ripple XRP is rapidly increasing. This swift increase in worth is because of their collaboration with big organizations and financial institution. Payments can be sent across borders through banks in low fees. Unlike Bitcoin, it does not rely on intensive proof of work. It is a data which is not only expensive but time-consuming too. Rather, the ripple is base on a shared public database. Although they have their own currency, they allow others to create their own through RippleNet. The cost of transaction on Ripple is $0.00001. It is planned to avoid the spammers’ attack. Ripple is designed to make day to day payments. So it is faster and easier than any other. You don’t have to worry about multiple regulation checks as it is designed to be used by the banks.
What Is Ripple Protocol Consensus Algorithm?
Ripple does not have a blockchain. Then the question arises how they will verify the transactions. Ripple Protocol Consensus Algorithm (RPCA) is designed by Ripple. It is used as a proof of correctness. The word consensus shows that each node has an agreement with the rest of the nodes. If on any issue a node shows disagreement, nothing will happen at all unless that one node agrees. Banks that support Ripple are Santander, Axis Bank, Westpac, NBAD, UBS, Union Credit, and Yes Bank.
How You Can Make Use Of Ripple:
Currency Exchange At Low Rates:
When it comes to currency exchange, USD is used as a mediator because many currencies cannot be converted to each other. If you want to make an exchange between two currencies, the first currency will be converted to USD first. After that, USD in converted into the second currency. It happens to be very expensive. If you use Ripple as a mediator, the same work will be done at low rates.
Quick International Transaction System:
Just have a look at the regular banking system. You wait for three to four working days for the transaction of payments. Bitcoin also takes one hour or more. Through Ripple, you can make your transaction in a few seconds.
Here, anyone can create his own currency to make transactions faster and at lower rates.
Ripple is getting popular day by day, yet it has some drawbacks. Because of these drawbacks, the Ripple is being criticized.
- Because of the popularity of Ripple, the banks are taking interest in the transaction through Ripple. But, there are many banks that are still not interested in it. They want transaction through money, not through the token.
- The fear of freezing the transaction is always there. It is said that the founder of Ripple once tried to make a transaction of more than a million dollar. The transaction was reversed which is against the very idea of cryptocurrency.