What Is Ripple?


Ripple Labs is a private software company that created the Ripple Protocol, an open-source protocol that includes the XRP ledger and RippleNet, a set of payment solutions products aimed at institutional usage (banks, non-financial institutions and digital currency exchanges). The company was originally named OpenCoin, but was rebranded to Ripple in 2015.

Key Takeaways

  • Ripple is an open-source protocol that provides a set of payment solutions aimed for institutions.
  • XRP is an open-source decentralized cryptocurrency and the native token of the Ripple network.
  • XRP is separate from Ripple, which is a financial technology company that focuses on advancing the adoption and use of blockchain technology in the global financial system.
  • The XRP token is used by the Ripple network to facilitate transactions and provide liquidity for cross-border payments.


Formerly known as Ripple Labs, Ripple is a centralized financial technology (fintech) company that provides a range of products and services to help banks, payment providers, and other organizations make global payments faster, cheaper, and more secure.

In 2011, David Schwartz, Jed McCaleb, and Arthur Britto started developing the XRP ledger as a solution to the limitations of Bitcoin. A year later, when the XRP ledger was launched, it included the native token XRP. Chris Larsen later joined the team and now serves as executive chairman and co-founder. The company changed its name numerous times until 2015, from Newcoin and OpenCoin to Ripple Labs, before finally settling on its current name, Ripple.

Ripple is focused on advancing the adoption and use of blockchain technology in the global financial system. It offers a range of products and services to help its customers stay competitive and compliant in an increasingly digital world and has become one of the leading fintech companies in the world.

How does Ripple Work?

Ripple Labs, based in San Francisco, operates RippleNet, a payment and currency exchange network that aims to remove obstacles and delays in the current financial system through the use of blockchain technology innovations.

The aim of RippleNet is to provide fast, affordable and convenient cross-border transactions for banks, as an alternative to SWIFT, which is the current international payments system that majority of the banks use. RippleNet has several advantages for international transactions, such as:

  • Transactions are processed in an average of five seconds.
  • The transaction fee is minimal, being 0.00001 XRP, even at the token’s all-time high in price.
  • XRP cryptocurrency can act as a bridge currency, providing financial institutions with a cost-effective way to trade currencies, by holding XRP instead of various types of fiat money.

Ripple’s Native Currency XRP

XRP is a cryptocurrency developed, issued and partially managed by Ripple Labs, a US-based company. XRP is one of several products offered by Ripple Labs, all aimed at improving the efficiency of cross-border payments, particularly in the banking sector. It is the native digital currency on the XRP Ledger, an open-source, permissionless and distributed ledger that can settle transactions within 3 to 5 seconds.

The XRP ledger utilizes distributed ledger technology instead of blockchain technology to support the transfer of tokens that represent fiat, crypto or any other unit. The protocol is completely open, allowing anyone to access it without prior approval from Ripple Labs. This opens up the possibility for both bank and non-bank actors to incorporate the Ripple protocol into their own systems.

The XRP cryptocurrency uses a consensus protocol called the Ripple Protocol Consensus Algorithm (RPCA) to verify transactions. Validators compare proposed transactions to the most recent version of the XRP ledger and accept legitimate transactions, for a transaction to be verified, the majority of the validators must accept it.

XRP is premined with a maximum supply of 100 billion. 80 billion of which are allocated to Ripple, with 55 billion locked in escrow, and the remaining 20 billion entitled to the co-founders and the core team. XRP is mainly known for its fast, efficient, reliable, and carbon-neutral nature.

Ripple and XRP Development

Ripple, a software development project, was first conceptualized by Ryan Fugger in 2004 through the creation of RipplePay, a platform that allowed people to extend credit to others in their community. This makes Ripple one of the few crypto projects that existed before the advent of Bitcoin, although it wasn’t a cryptocurrency at the time. Bitcoin’s anonymous creator, Satoshi Nakamoto, even mentioned Ripple in an email.

In 2011, programmer Jed McCaleb began developing the XRP cryptocurrency and blockchain. He assembled a team, found investors and approached Fugger in 2012 to use his RipplePay network. Fugger agreed to transfer control of RipplePay.

They launched their company and the XRP cryptocurrency in 2012, originally under the name NewCoin, but later changed it to OpenCoin and then to Ripple. Ripple went on to establish partnerships with financial institutions, and in 2019, it announced that more than 300 financial institutions in over 45 countries were using its RippleNet payment network.

On December 22, 2020, the Securities and Exchange Commission (SEC) filed a lawsuit against Ripple for selling $1.3 billion in unregistered securities through its XRP cryptocurrency. Ripple denies the allegations and claims that XRP is not a security.

Ripple XRP FAQ

How Is Ripple Different from XRP?

Even though they’re used interchangeably quite often, the terms Ripple and XRP actually have completely different meanings. Ripple refers to the tech company that provides financial solutions and products, while XRP is the Ripple network’s native token.

Ripple is the company that provides financial products and services, while XRP is the digital asset that is used by the Ripple network to facilitate transactions.

Is Ripple Better Than Bitcoin?

Ripple is designed to be faster than Bitcoin, with transaction times that are measured in seconds rather than minutes. The difference makes it way more suitable for applications where speed is an elemental factor. Cross-border payments and real-time transactions are common case scenarios.


Ripple is generally cheaper to use than Bitcoin, with lower transaction fees and other costs associated with using the network. This makes it more attractive for users who want to save money on their transactions, and it also makes it more scalable, as it can support more transactions without increasing costs.

Energy Efficiency

Unlike Bitcoin, Ripple uses less energy when it comes to processing XRP transactions and maintaining the network. This makes it more environmentally friendly than the Proof of Work network of Bitcoin.

The question of which one is better is a matter of personal opinion, and dependent on what people are looking to make use of from the cryptocurrency. Some prefer Ripple’s speed and efficiency, while others prefer Bitcoin’s decentralization, security, and established track record.

Final Thoughts

XRP’s remittance solutions are of great help, especially for the financially underserved and the unbanked. These communities make up over a quarter of the world’s population. Here at dua, our vision is to also provide remittance solutions through DeFi within our app ecosystem made up of dua and Spotted, matchmaking apps that boast +5M users combined. DUA token is coming to the ecosystem, empowering users for their social and financial needs combined. Learn more about DUA and follow us on Twitter to stay updated!

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