In the last couple of years, cryptocurrencies or digital currencies have experienced this unprecedented rise in value. This has made them one of the most profitable financial investment anyone can make at the moment. With the rise in the value of these cryptocurrencies, a number of them have been developed and launched into the crypto market. According to reports from the CoinMarketCapital website, there are over 3,000 active trading cryptocurrencies in the crypto market. While this number is increasing daily, some of these digital currencies have managed to stand out from the crowd.
Bitcoin which is the oldest and largest crypto exchange has remained at the number one spot. One other coin that has managed to attain and maintain a rise in price is the Ripple cryptocurrency.
For the purpose of this piece, we will discuss some of the differences between these two cryptocurrencies.
The Bitcoin Network
Developed and launched in 2009, Bitcoin happens to be the first cryptocurrency platform to be developed. This crypto was developed by a developer who goes by the pseudonym, Satoshi Nakamoto. Basically, the aim of Satoshi Nakamoto when developing this crypto was to offer users a global payment system that would facilitate the transfer and receiving of funds on what is referred to as a peer-to-peer (P2P) basis. Basically, the idea behind this network is to enable people to send funds without having to involve third-party or intermediaries that will process and confirm transactions.
Like most of the other cryptocurrency networks, Bitcoin is decentralized in the sense that there’s no central authority that is in charge of controlling activities that take place on the network. Instead of having a central authority in charge of approving transactions, transactions on the Bitcoin network are confirmed by a community of Bitcoin members referred to as “miners.” One of the interesting thing about this platform is that anyone can become a miner by simply getting the needed tool. For the time and money spent on acquiring the mining rig, they get to earn rewards on the network.
The Bitcoin network has a maximum coin supply of exactly 21 million, and currently, about 17 million has been released to the market. According to the developers and speculators, all BTC coins are to be released into the market by the year 2140.
The Ripple XRP Network
Three years after the launch of the Bitcoin network, Ripple was launched. This network, unlike Bitcoin, was developed by Ripple Labs a United States-based company. The main aim for the development of the Ripple network is to offer or create a payment system that banks can make use of to carry out domestic and international transactions. While this platform was developed with the financial industry in mind, you can buy and make use of this coin.
Since the launch of this network, most people have asked the difference between Ripple and the XRP coin. It is important that you remember that Ripple is the name of the technology or network that affords you the opportunity to carry out fast, efficient, and cheap transactions. On the other hand, XRP is the native coin of the network. The Ripple network is built on the blockchain technology which was also used to build Bitcoin. Like Bitcoin, Ripple is a decentralized crypto platform, and this means that there are no intermediaries or third-party service providers that have been charged with the task of approving transactions on the network.
Unlike Bitcoin that would have only 21 million BTC coins in circulation, the maximum coin supply of the Ripple XRP coin is 100 billion. Currently, there are over 60 million XRP coins in the crypto market. This high number of coins to be released is in line with the vision of the network to revolutionize how the financial industry operates and this it plans to do with the XRP coin.
Bitcoin Vs. Ripple
While we have discussed why and when these platforms were launched, we’ll have to make a comparison based on certain factors. These factors include;
- Technical Performance;
When it comes to the technical performance of these two networks, Bitcoin lags behind. On the Bitcoin network, it takes about 10 minutes for each transaction carried out to be approved. Irrespective of where you are making the transfer from, it would take approximately 10 minutes before it is confirmed or approved. On the other hand, the Ripple network is one of the fastest crypto networks. On the Ripple network, it takes about 5 seconds or less for each transaction to be confirmed. The transaction speed makes Ripple the ideal choice when it comes to transfers both domestic and international.
- Transaction Cost;
Initially, carrying out transactions on the Bitcoin network was cheap. This was until the crypto experienced this unprecedented rise in popularity and price. Currently, the Bitcoin network is not the best network to make transfers as you could be charged high fees. In one of the busiest periods of this network back in 2017, the cost of carrying out a transaction on the network rose to $40. On the other hand, the cost of carrying out transactions on the Ripple network is about 0.0001 XRP. This makes it way cheaper than Bitcoin.
The Ripple network was not developed to be mined. The XRP coins have already been pre-mined and would be released into the market whenever the developers feel like. On the other hand, there are miners on the Bitcoin network. They are responsible for confirming transactions on the network, and they receive rewards in the form of BTC coins for their effort. The use of ASIC miners has in the last couple of years questioned the decentralized nature of this network.
- Development Aim;
According to the developers of the Ripple network, it was developed to offer financial institutions and individuals the opportunity to make fast, cheap, and efficient transactions across borders. This network could be referred to as a payment system. On the other hand, Bitcoin was developed to serve as a P2P system where individuals are able to transfer and receive funds from one another.
Finally, these two cryptocurrencies are different both in their aim and structure.
Molly loves all things Starbucks and can’t live without her 5 cups of coffee a day. She
loves writing, binging new shows on Netflix, and waffles. When she isn’t writing, she
can be found at Pilates.