Cryptocurrency, including Bitcoin, is primarily associated with blockchain technology, decentralization and mining with the use of advanced computing machines called miners. Meanwhile, XRP, although classified as a cryptocurrency, is not based on blockchain, is actually centralized, and at the same time cannot be mined with the help of miners. What is this “strange” cryptocurrency and is it worth investing in? Check out the text below.
Why is XRP an unusual cryptocurrency?
Already in 2004, the American company Ripple created a prototype of a monetary system, which, however, has been officially functioning since 2014. However, it is different from a typical cryptocurrency platform.
Like other cryptocurrency networks (Bitcoin blockchain, Ethereum), the Ripple platform offers high, increasing scalability, but unlike most cryptocurrencies, it is centralized in nature and there is neither Proof of Work nor Proof of Stake consensus (cryptocurrency mining methods). This currency is not mined, as is the case with Bitcoin or Ether. All Ripple XRPs were created at one time in the number of 100 billion.
How can you become an XRP owner?
Since there is no mining in the case of Ripple’s currency, XRP, the only way to become a XRP owner is to acquire it. This can be done either at a cryptocurrency exchange or at a cryptocurrency exchange. It is worth noting that buying (and selling) not only XRP, but also other cryptocurrencies on the exchange is definitely more profitable. Therefore, if you want to acquire XRP, take advantage of this opportunity.
If you intend to invest in XRP for the long term, remember not to leave the currency you bought on the exchange. For security reasons, there should only be cryptocurrency intended for ongoing trading in the exchange account. Keep your savings in a desktop, browser, or hardware wallet.
Is it worth investing in XRP?
In terms of capitalization and trading volume, XRP is one of the top projects related to cryptocurrencies. However, is it worth investing in Ripple? Let’s check what the experts advise.
First of all, it should be emphasized that Ripple as a project has a great chance of success and may play an important role in the process of modernizing classic banking in the future. Some experts predict that over time it will even threaten systems such as SWIFT. However, it is worth bearing in mind that the success of RippleNet does not necessarily mean the success of the XRP cryptocurrency.
Analyzing the chart showing the fluctuations of the exchange rate over several years, it is clear that things are different with XRP. The trend is not clearly upwards, as is the case with Bitcoin or Ether. This raises questions about the future of this cryptocurrency. On the other hand, however, investing in XRP is encouraged by its affordable price and low transaction fees, as well as its direct relationship with the Ripple platform, which is very promising. However, as with other cryptocurrencies, you have to assess the risks yourself and decide whether to invest in XRP.