Ripple is a prominent crypto-asset and currently the third largest cryptocurrency by market capitalization. Developed by Ripple Labs, its intended purpose is to provide a gross settlement system which can be used to enable cross-border currency or asset transfers and provide liquidity for financial institutions, banks, payment providers, exchanges etc., using the blockchain technology. Ripple’s defined aim in its own documentation is to provide a system which enables “secure, instantly and nearly free global financial transactions of any size with no charge-backs.”
Ripple Token Characteristics
Ripple’s native token (XRP) has a huge supply of around 100 billion tokens, the supply though reduces at a snail’s pace, by virtue of the tinny fees collected for transactions, which is then removed from overall supply. However, XRP can’t be classified as a deflationary token.
Ripple Token (XRP) according to the company’s claim, wasn’t created by it, but gifted or handed over from a previous open source project. Unsurprisingly, the majority of the XRP supply is held by the founders, team members and the company itself.
Is Ripple a True Cryptocurrency?
Ripple isn’t technically a true cryptocurrency, since it is centralized and permission-ed. Despite the presence of external validators, Ripple is essentially in complete control of the network. This violates the well defined characteristics of the cryptocurrencies which must be able to operate without permission from any single or multiple entity and should be decentralized.
Ripple network and XRP token
It is extremely important to realize that Ripple Technology doesn’t necessarily need XRP token to function. Any company, bank or entity willing to use it can do so, without buying and holding XRP tokens in reserve. Nor is the use of XRP tokens even desirable, since its value is severely volatile, a large number of it needs to be held to be useful. Also, the stable coins and in future the bank issued digital currencies, would be better suited for the purpose. In general, the Ripple network’s native XRP token doesn’t have any significant use-case. This is the exactly why despite the increased adoption of Ripple technology by different entities and institutions, the price of XRP hasn’t reflected any meaningful change. So while the Ripple Technology itself is revolutionary and sound, the XRP token isn’t.
The Ripple Labs has further engaged in continuous unlocking of tokens from escrow and heavy sale of XRP tokens on exchanges, essentially printing money out of thin air, keeping a downward sale pressure negatively impacting prices and engaging in what some have called a “never ending ICO“.
Ripple’s native XRP tokens aren’t equity shares, which means buying the tokens doesn’t give the holder, any stake in the company’s profits. Add to it, the fact that XRP tokens have no significant uses in the Ripple Technology, which can be used without acquiring these tokens and it all results in an asset, that is purely speculative and whose price is heavily manipulated by the Ripple Team, who are the majority holders.
- Shiba Inu Price Prediction: How High can SHIB Price reach by 2030?
- Is Ripple (XRP) Market Cap Exaggerated?
- What Is Stellar? Here’s How XLM Can Outperform XRP In 2022!
- PEPE Coin Price to Reach $5 in the Next Seven Days?
- Ripple Lawsuit News: When will Ripple settle the SEC Lawsuit?
- Conservative Prediction: Can XRP reach $5 in 2023?
- Ripple Price Analysis
- Ripple Price is about to SOAR HIGH! Here’s what’s new with the SEC…
- Big Win: Ripple to launch CBDC Platform for Central Banks and Governments?
- Renewed HOPE? Buy Ripple XRP while you still Can!
- XRP Market Cap: Is XRP Set to Flip Bitcoin in Market Capitalization?
- 10 Reasons why you should invest in Ripple
- Top Crypto News of the Week in 6 minutes
- 5 Reasons Why Chainlink Isn’t Likely To Be Classified As Security
- Inflation Basics: Cryptocurrencies
- Ripple’s Victory: A Promising Step Toward U.S. Banks Adopting XRP?
- Ontology Executes Major ONT Buyback, Improves Token Economy
- XRP Price Prediction for February 2023 as the Crypto Market EXPLODES!
- ADA looking to flip XRP: Is Cardano better than Ripple currently?
- Top 4 Ripple Price Predictions from Pro Investors
- State of New York Greenlights 10 Cryptocurrencies for Bank Custody and Listing
You might also like
More from Altcoin
What's interesting is the startling similarity between the market patterns of Bitcoin (BTC) and the NASDAQ. Let's delve into this …
Ethereum phone: designed to seamlessly integrate with EVM chains and layer 2s. It created a significant buzz by selling out …
Within a few months of its introduction, Base protocol has accrued a TVL of $185 million. Is Cardano dead?