XRP is the native digital currency used on the XRP Ledger platform, an open-source, decentralised blockchain platform used for high-speed global transactions. XRP was created by Ripple, a privately-held fintech company that provides high-speed, inexpensive means of transferring funds globally using RippleNet. Here is a breakdown of the cryptocurrency:
Ripple: The fintech company behind the creation of RippleNet, XRP and the XRP Ledger.
RippleNet: A high-speed global payment network that uses the XRP Ledger to validate transactions between banks and other financial institutions.
XRP: The native digital asset used on the XRP Ledger. XRP functions as a payment for products such as payment settlements, asset exchange, and remittance systems.
XRP Ledger: A permissionless network of peer-to-peer servers used to validate XRP transactions.
Like Bitcoin (BTC), XRP can be sent between two independent participants on the Ripple network without needing an intermediary. XRP transactions use a consensus mechanism known as the XRP Ledger Consensus Protocol, allowing for fast, global transactions.
This means that, unlike Bitcoin, XRP does not use energy-intensive mining to validate transactions. Instead, XRP’s consensus mechanism allows independent, verified validators to secure the network.
XRP has evolved significantly since it was introduced to the world in 2012. Starting out as an international payments solution, the XRP developers are now creating an all-encompassing Web3 ecosystem. The XRP Ledger supports smart contracts and dApps, allowing developers and DeFi users to benefit from the network.
In 2024, Ripple released their first USD-pegged stablecoin built on the XRP Ledger, RLUSD. The digital currency secured NYDFS approval and is also compatible with Ethereum’s ecosystem.
Check out our in-depth guide to Ripple (XRP), available on Swyftx Learn.