Is Ripple a Competitor to Ethereum?
At a time when markets were falling, one currency showed an admirable firmness. Ripple made it clear what a fast recovery should look like and overran Ethereum in terms of market cap. Actually, this was not the first instance when these currencies swapped places, but this November was especially lucky for Ripple. The currency still runs second with the total value of $16.5 million.
Is this a temporary thing, or should Ethereum feel threatened?
Ripple in a Nutshell
Ripple is a cryptocurrency that runs on RippleNet. This network connects various banks, credit companies, payment providers, financial institutions, and digital asset exchangers for better efficiency and direct communications between them. Although the payments in the network can be made via any other currencies, XPR is used as the main currency of RippleNet and it provides better liquidity.
Actually, the protocol behind Ripple appeared several years before Bitcoin and it was supposed to ‘provide secure payment options to members of the online community via a global computer network through the use of traditional currency as well as virtual currency.’
The Vice President of American Express, Colin O’Flaherty, while confirming they will use one of Ripple’s financial solutions, gave the platform quite an accurate description:
“Ripple offers instantaneous, point-to-point conversations between the sender and receiver of funds. And that provides a real opportunity to alleviate most of the issues our customers are facing.”
What Has Caused The Recent Success
The currency courted many allies and some experts are already predicting that by the end of 2018 the coin could be worth $1 and advise it as the only sensible crypto to invest in.
At the beginning of November, Ripple announced the launch of xRapid payment platform, which uses XPR token, and several financial companies have already supported this initiative. The platform is supposed to improve the international money transfer system by making it cheaper and faster.
Besides, a lot of other banks and financial institutions have started considering Ripple Net and XPR token as promising technology that could substantially improve the quality of financial transactions. Currently, the platform aims to execute 50,000 transactions per second, which is twice more than Visa’s performance.
Ripple keeps attracting new supporters and has already worked out more than 200 agreements with various companies around the globe. Among them is Swedish bank, SEB, which is going to use XPR as an alternative payment solution for international money transfers between Sweden and USA. Also, one of the leading cryptocurrency credit сompanies, Cred, has confirmed that they will start using XPR token in the near future.
Competition with Ethereum
Ethereum used to hold second place behind Bitcoin for a while. One of the major advantages of Ethereum — a truly decentralized system has that allowed the mining of it it all over the world without the use of expensive equipment, much cheaper than Bitcoin. Miners were also attracted by the profit that solid coin price could provide. Later on, Vitalik Buterin spoke out against ASIC-mining and the coin’s rate dropped.
Ripple, on the other hand, does not depend on miner’s support and the transaction speed it provides is definitely much faster. For the record, it is 75 times faster. But considering the ultimate goal that Ripple has, it cannot be a key argument of the ‘competition’.
Ripple is supposed to allow fast and cheap transactions, that’s what it was made for in the first place.
Conclusion
Although Ethereum could learn a few things from its ‘rival’, it has a completely different purpose which is developing dapps and smart contracts.
Just to make things clear: Ripple’s biggest opponent is SWIFT and not Ethereum.
If You Read Until the End
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