Is Ripple better than Bitcoin?
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Since the creation of Bitcoin in 2009, it has been the most globally well-known cryptocurrency. Since then there has been many new cryptocurrencies to compete with Bitcoin and one called XRP (Ripple) started in 2016 has been rising in popularity from many cryptocurrency fans and investors all over the world. However, is Ripple better than Bitcoin? and what are the main differences between Ripple and Bitcoin? Well, in this guide we will take a look at some of the main factors.
Both Bitcoin and Ripple have different standpoints from ownership, codebase, team and applications. Bitcoin is managed by a group of developers and created by the mysterious person Satoshi Nakamoto, as Bitcoin is a decentralized system and open sourced meaning it is not ruled by any third parties, banks or government. Also, it is owned by a community and they have to agree to make any changes. You need at least 51% of people to agree if you want to modify something within the system. On the other hand, Ripple XRP is maintained by a confidential company and the record of transactions are more closed affair. As the company’s consensus-seeking method will enable faster upgrades. Since, within the amendment system, the developers will require consensus before modifying the network. Commonly, if an amendment gains 80% support for a period of two weeks then it will play into effect and all the future ledgers will have to support it. Therefore, this will allow a democratized tactic to the development that will enable for changed while avoiding irreversible splits.
Bitcoin Vs Ripple: How do they Work?
Users of Bitcoin will be able to transact directly to other users, with the transactions being noted down in a public ledger called the blockchain. If a transaction is added onto a blockchain, it will then be irreversible and cannot be modified in any way. Addition to this, if it is added onto the blockchain it means that the transactions are verified and also the network will be secured by miners. Miners are volunteers that uses their computing power to solve difficult mathematical problems so they can receive Bitcoin as a form of reward.
On the other hand, XRP is more of a recent cryptocurrency, as it was launched in 2012 and created by Chris Larsen. Ripple’s goal is to offer faster, affordable and more reliable cross border payments between the banks than the structure currently in place. So, this is where the cryptocurrency XRP comes in. The XRP ledger utilizes consensus protocol that depends on a vast number of validators and to record and verify transactions. Additionally, the XRP ledger is powered by a peer-to-peer network that is a decentralized. The function XRP token does is that it will act as liquidity source for banks and payment providers. So, by using Ripple’s network and XRP functioning as a link between the different fiat currencies, Ripple will then enable users to send payments that settle in a matter of seconds.
Bitcoin Vs Ripple: Key Differences
The main purpose for Bitcoin is the vision Satoshi Nakamoto had, which is to enable peer-to-peer transactions that will not require for users to use a third party. While on the other hand, Ripple is more towards supporting the banks, instead of taking over the world’s financial corporations Ripple’s purpose is to collaborate with banks so it allows them to make more efficient global transfers.
The total supply is a key difference between these two as well, since Bitcoin has a maximum supply of 21 million coins. An estimated of 83% of Bitcoin’s maximum supply, which is estimated around 17.3 BTC have been mined at this time of writing (Oct 2018). While, the cryptocurrency XRP has a total supply is capped at 100 billion tokens, the biggest difference is the fact that these tokens are all created as there is no mining with XRP. However, XRP supply will reduce over time in the future due to tiny amount of XRP is eliminated with each transaction.
Transaction times and Fees
A massive key difference is the transaction times and fees. As Bitcoin transaction takes around 10 minutes to confirm to the transactions and will take even longer during period of intense network congestion. While the transactions fees for Bitcoin from the 12 months to July 2018 have an estimated range from AUD$0.69 to a slight peak of more than AUD$69. Meanwhile, XRP transaction time is confirmed in 4 seconds and the transaction fee cost less than AUD$0.01. Additionally, XRP has the capabilities of managing 1,500 transactions per second while Bitcoin does 7 transaction per second.
Both these cryptocurrencies have their own philosophies and are developed with different goals in mind. XRP is dissimilar to Bitcoin and it isn’t likely going to be the next Bitcoin, however, that doesn’t mean it can’t play a major part in the global transformation of our monetary system into the digital age. XRP has support from many huge financial institutions and collaboration third parties. This is the only digital currency that has this much backing by institutions, and additionally Ripple the company has solid development on the global payment industry. Therefore, as XRP and Ripple get more recognition and more globally known then it might play a major role. We will just have to wait and see…
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