In the world of cryptocurrency, Bitcoin is one of the pioneers and most widely known. But, the past few years, there have been several others which are moving into the cryptocurrency market. One of those being talked about giving Bitcoin a run for its money – no pun intended – is Ripple. Yet the differences between the two are not known by many out there. As more people are beginning to use Bitcoin and other forms of digital tokens to purchase goods, trade, mine and do other things, cryptocurrency has skyrocketed. With that surge though, there has been a ton of confusion being created as well. What are the significant differences in them? Which cryptocurrency is better when it comes to Ripple vs. Bitcoin?
One of the major dissimilarities between Ripple and Bitcoin is the public Blockchain. While Bitcoin uses cryptography in order to keep all of the transactions secure, Ripple does not. It doesn’t mean that Ripple is by any way less safe to use. To validate the transactions, Ripple utilizes a network of nodes. However, unlike Bitcoins, they are not anonymous or faceless P2P nodes. That means that financial institutions and bands take part in the process. At the same time, Ripple coins are issued, not mined the same way Bitcoins were created into existence.
To make the differences between Ripple and Bitcoin even more significant, there’s also the operating licenses. Ripple has applied and obtained a New York BitLicense, which Bitcoin does not have. The same goes for the name of the companies. The creator of Bitcoin or founder is Satoshi Nakamoto. He never used his name in association with Bitcoin. In fact, Satoshi went as far as to disappear from the spotlight altogether once he created Bitcoin. On the other hand, Ripple is the actual name of the company which had the digital currency created.
All About Bitcoins
Presently, Bitcoins or BTC, are regarded as the most popular and active form of digital currency. Their primary focus from the start was decentralization. It is what has made the peer-to-peer cryptocurrency so popular and loved. To add to its attraction and popularity, Bitcoin tokens are used by both merchants and consumers. The only setback has been how challenging making smaller payments can be. However, with the new Lightning Network, those things will likely change for the better.
Bitcoins are issued via a Blockchain which is process most recognize as mining. That makes Bitcoins one of the truest forms of digital cryptocurrency on the market. The past few years, Bitcoins use and acceptance has increased drastically. Major companies and retailers are accepting them as forms of payment. The Bitcoin tokens are also reaching global recognition as more people get on board.
The one setback which Bitcoin faces is the amount of time a transaction takes to settle. In some cases, it may take anywhere between 8 minutes to hours or even days. Part of this problem has to do with the size limit presently found on the block. There are numerous payments and transactions going through the Blockchain. Slowly, changes are being made to speed up these transactions and make the problems disappear. Still, when it comes to those who don’t want to use financial institutions and deal with banks, Bitcoin is the way to go. The same for those who want to make anonymous purchases online.
Bitcoin offers several key features to those who want to use it as payment. For one, you get better privacy when you want to make purchases online or anywhere. In fact, the privacy feature is part of what made and makes Bitcoin so popular. It can be almost impossible for people to link any Bitcoin transactions to you. A lot of Bitcoin users embrace it since it helps stop banks and miners from controlling the digital currency. You get full validation from Bitcoins and your transactions are accepted as valid.
The security characteristics is also another pivotal asset which Bitcoins provides its users. In today’s world of hacking and internet schemes, the increased security works to protect those that use Mobil devices, computers and the web. Plus, the interface of Bitcoin Core wallet comes with many useful features. These include many other cryptocurrencies do not have.
All About Ripple
Ripple is also known as XRP and it is very different from other digital currencies. This is due to Ripple not having a public Blockchain as Bitcoin and other forms of cryptocurrencies do. They do have an internal network called the XPR ledger. In this ‘Enterprise Blockchain’ is where the network runs on. Unlike Bitcoin where the Blockchain is public, there is little known about the way Ripple works via that ledger. The need for people to be able to send secure and instant transactions involving an infrastructure of participants, is what brought about Ripple. That is why the digital currency was originally designed for.
The entire concept was predicated upon users being able to transact several different forms of digital valuables. These included commodities, fiat, loyalty points, mobile credits and of course, cryptocurrency. As the company grew, the Ripple cryptocurrency token was added later. This same token is what people can utilize today to settle any transactions or trades on the network.
Ripple became instantly appealable to anyone interested in digital payment alternatives and solutions. Especially to institutional investors, banks, financial middle-men and others. That helps explain why Ripple found several big name investors to fund it. They obtained angel funding from several people in the finance sector. The investment helped Ripple market and develop its protocol. Some of the big names which invested in Ripple digital currency are Google Ventures, Santander InnoVentures, Andreessen Horowitz, IDG Capital Partners and Pantera Capital.
Some would argue that Bitcoin and Ripple shouldn’t be compared versus one another. Part of that is because Ripple is managed by a company, unlike Bitcoin. In addition, Ripple cryptocurrency is also not an emblematic of the Blockchain concept. Side by side, there are numerous things which set one apart from the other. At the same time, Ripple and Bitcoin can work side by side. Many people are surprised to know that Ripple has actually been around before Bitcoin actual Blockchain though. The fact is that the Ripple Network allows other currencies to be sent, received and stored using their platform, including Bitcoin. In retrospect, this means Ripple can actually be used together with Bitcoin, instead of being rivals. Cryptocurrency experts would say that Ripple is simply trying to move and bring the online digital currency to the future.
In the same way Bitcoin has many great characteristics which make it very useful, so does Ripple. One of them is being able to use it to send payment via the Ripple network by a bank. A financial institution can send the payment using a person’s bank account without a hitch. This can be done cross-border from one customer to the other. At the same time, the cost of the transaction can be calculated by Ripple all the way to the nearest cent. Another key feature anyone who uses Ripple will enjoy is the instant payments process. The transactions are carried out via the international SWIFT network. Unlike other financial institutional transfers which typically take days to go through, Ripple transactions occur almost instantly. People can also enjoy the B2B friendly aspect of Ripple.
Other Things To Consider About Bitcoin vs. Ripple
Even with all of the key features of both Bitcoins and Ripple taken into consideration, reaching a conclusion of which to use may not be that simple. Each form of digital currency provides features everyone can benefit from. Because the Ripple nodes allow the payment validation to take place, Ripple payments are almost done instantly. This is one of the things which separates it from Bitcoin. Also, Bitcoins are minted into blocks whereas Ripple is not. That’s due to the Ripple currency being issued by Ripple Labs. Another factor to consider is the total amount of Ripple currency in circulation.
Presently, there are about 38 Billion Ripple currency circulating all over the network. In contrasts, there is only 21 million Bitcoins on the market. There will never be any additional Bitcoins made so that number is considered finite. The only way more Bitcoins can be created is when miners have finally unlocked all 21 million of them. If that happens, the supply of Bitcoins will be used and the protocol involving creation of Bitcoins will have to be changed.
All together, there are numerous types of cryptocurrencies available on the market today. Bitcoin is of course number one, while Ripple is ranked third. In truth, many of the people who are crazy about the digital currency market, are on the fence when it comes to Ripple. Ripple has to be used within the SWIFT network interbank. For those that appreciate cryptocurrency, that may work against it. The reason for that is based on the influence factor. Unlike Bitcoin, Ripple’s price can be influenced by news relating to the banking industry and its adoptions.
At the same time, Ripple is cheap as a coin which makes it more appealing and likely to be more popular. That means if banks decide to use Ripple as its crypto payment of choice, the overall value could increase dramatically. Yet the digital currency market is exploding and each day more newcomers are getting in on the act. Other companies and cryptocurrencies are trying to gain on Bitcoin and Ripple, if not overtake it. Irrespective of which one you use, the only thing that remains clear is that using digital currencies, has numerous benefits everyone can gain from.