What is {{chartFullCurrency}}?

XRP is a digital currency that has gained attention not only in the cryptocurrency markets but also in broader discussions about traditional financial systems. XRP is not just a speculative investment, but it is designed to solve specific challenges faced by financial institutions and payment service providers. These challenges include the slow pace of international payments, high transfer fees, complicated currency exchange, and reliance on outdated systems like SWIFT. XRP aims to provide an alternative that enables near real-time, secure, and cost-effective global payments.

Unlike many other cryptocurrencies, XRP is not trying to create an entirely new economic system independent of the current financial infrastructure. For example, Bitcoin was created as a reaction to traditional financial systems and aims for a fully decentralized and independent monetary system. XRP, on the other hand, works somewhat differently: its core idea is to support and complement existing systems – especially the operations of banks and payment institutions – by using blockchain technology to enhance their existing processes.

XRP operates as part of the XRP Ledger, a decentralized, open-source blockchain. It differs technically from many other blockchains in that it does not use mining (Proof of Work) or staking (Proof of Stake), but instead has its own consensus mechanism, where pre-selected validating nodes reach consensus on each transaction quickly and energy-efficiently. This makes the XRP Ledger one of the fastest and most lightweight blockchains in the world.

XRP's development is supported by the American technology company Ripple, which does not own the XRP Ledger but acts as a central player in its ecosystem. Ripple develops commercial applications around XRP, especially in the form of the Ripple Payments platform, which is used by financial institutions, banks, and remittance services worldwide. Within the Ripple Payments system, XRP functions as a so-called "bridge asset," enabling the exchange of two different fiat currencies without either party needing to hold funds in the other party's currency. This removes the need for liquidity at multiple stages and significantly speeds up the process.

XRP's History

XRP's story began in 2011 when three software developers, David Schwartz, Jed McCaleb, and Arthur Britto, became interested in Bitcoin but also recognized its significant technical limitations. According to them, Bitcoin’s Proof of Work-based system was too slow, expensive, and energy-consuming to function as a sustainable global payment system. This led to the idea of a new, lighter, and payment-optimized blockchain: the XRP Ledger (XRPL).

In June 2012, XRPL was officially launched. Shortly after, the trio was joined by entrepreneur Chris Larsen, and under his leadership, a company called NewCoin was founded. It was soon renamed OpenCoin and ultimately became Ripple. Ripple's mission became the commercialization of the technology and integrating it into the traditional financial system.

In line with the original vision, XRP Ledger was designed specifically as a payment system that:

• Offers a significantly more environmentally sustainable alternative to Bitcoin.
• Enables much faster and more scalable transfers that occur in seconds – without high transaction fees.
• Is technically optimized specifically for value transfer, not as a general-purpose application platform like many other blockchains, focusing on solving real problems in international payments.

Unlike many other cryptocurrencies, all XRP tokens were created at once. The total amount, 100 billion XRP, was divided among the founders and Ripple. Of this amount, the founders donated 80 billion to Ripple, and the company placed the majority of the tokens in a scheduled escrow system to secure market stability.

One of the key differences of the XRP Ledger compared to Bitcoin was its consensus mechanism, which does not require mining. Instead, validating nodes quickly and energy-efficiently reach consensus on transactions. This allowed for nearly instant transfers, very low fees, and high scalability. These features made the system particularly suitable for global finance use.

In 2013, the OpenCoin name was dropped, and the company has been known as Ripple Labs since then. The company deliberately made a strategic choice: it did not aim to “overthrow” the traditional banking system but to develop a modern and efficient infrastructure alongside it, into which traditional financial institutions could gradually transition. XRP's role in this was to function as a bridge currency, allowing for the quick exchange of different national fiat currencies without heavy intermediaries.

In 2020, XRP Ledger's development was further supported with the founding of the XRPL Foundation, an independent and nonprofit organization tasked with promoting the decentralized development of XRP Ledger and its global adoption. The foundation received initial funding from Ripple and the cryptocurrency company Gatehub.

SEC Lawsuit

One of the biggest challenges in XRP's history began in December 2020 when the U.S. Securities and Exchange Commission (SEC) sued Ripple Labs. The SEC claimed that XRP was a security and that Ripple had violated federal law by selling it without proper registration. The charges were also directed at Ripple's CEO Brad Garlinghouse and Chairman Chris Larsen personally. The lawsuit was a significant blow to Ripple and the entire XRP ecosystem: several U.S. crypto exchanges, such as Coinbase and Kraken, removed XRP from their offerings as a precaution.

After over two years of litigation, there was a major breakthrough on July 13, 2023, when the judge ruled that XRP is not a security when sold on exchanges to the public. XRP's price surged by as much as 85%, and several exchanges reinstated it for trading the same day. In October 2023, the SEC also dropped the personal charges against Ripple’s leadership.

The decision was a significant victory for Ripple and the entire XRP ecosystem. Had XRP been classified as a security, its use in international payment solutions, especially in the United States, would have been significantly jeopardized. The court's ruling solidified XRP's position and paved the way for broader adoption in the global financial system. The outcome of the lawsuit was critical to the future of the entire project. Had XRP been broadly classified as a security, its trading would have been drastically hindered in the U.S. and potentially in other countries, weakening its operational viability. The decision, therefore, was not only a legal but also a strategic relief for the entire ecosystem.

What is the XRP Ledger?

The XRP Ledger (XRPL) is one of the oldest operational blockchain platforms in the world. It was launched in 2012 and has since served as the foundation for XRP token transfers. The architecture and principles of the XRP Ledger differ from many other blockchains, especially in terms of energy efficiency, speed, and transaction capacity. XRP functions as the native currency of XRPL and is an inseparable part of its technical structure.

The XRP Ledger was designed from the ground up to support fast and efficient value transfer on a global scale. Unlike many modern blockchains, which focus on diverse smart contracts and Web3 solutions, the strength of the XRP Ledger lies in its secure and high-performance payment protocol. The XRP Ledger is not meant to compete with Ethereum or Solana in programmability but to build the most functional, stable, and affordable network for financial transactions.

Key features of the XRP Ledger include its own consensus algorithm, which allows for block validation without mining or staking. Transactions are confirmed in a few seconds, and the network can handle over 3,000 transactions per second. Transfer fees are almost negligible, making microtransactions possible. Additionally, the network has a built-in decentralized exchange (DEX), support for tokenization, NFTs, lightweight smart contracts (Hooks), and decentralized identity solutions. These features make the XRP Ledger not only a payment platform but also a versatile digital asset network.

In recent years, the functionality of the XRP Ledger has gradually expanded – not to the extent of becoming a full-fledged smart contract platform, but in ways that support lighter and more efficient programmable solutions as well as new digital assets.

Multifunctional and Scalable Payment System

At the core of the XRP Ledger is the ever-relevant task of enabling nearly instant, global, and affordable payments. Transactions involve not only XRP currency but also support for transferring other assets. The blockchain's structure makes it possible to issue and transfer practically any asset, such as digital U.S. dollars, euros, gold, or even loyalty points.

In practice, the XRP Ledger serves as a platform for tokenized currencies and commodities. Thousands of assets are already moving on it, as part of financial institutions and community trials and commercial applications.

Ripple and the RLUSD Stablecoin

Ripple USD (RLUSD) is a stablecoin developed by Ripple, which was officially launched in December 2024. Its purpose is to offer a stable and transparent digital currency that can be used in both traditional and blockchain-based payment systems. RLUSD is pegged 1:1 to the U.S. dollar, and its backing consists of cash reserves, U.S. government bonds, and other liquid instruments. Ripple publishes monthly audit reports of the stablecoin's reserves, which enhances its credibility among investors and institutions.

RLUSD operates on both the XRP Ledger and the Ethereum blockchain. This makes it a versatile tool for decentralized finance (DeFi), payment applications, and international currency transfers. The XRP Ledger provides RLUSD with fast and nearly cost-free transfers, while Ethereum support ensures compatibility with broad DeFi ecosystems.

RLUSD has received approvals from financial regulators in New York and Dubai. Ripple aims to use RLUSD to tap into expanding stablecoin markets, where there is increasing demand for reliable and regulatory-compliant alternatives. The adoption of RLUSD also supports Ripple's broader vision of modernizing international payments and reducing reliance on traditional, slow, and cumbersome systems.

In Brief: XRP Ledger

The XRP Ledger is a unique blockchain in that its technical evolution follows two parallel paths: its core remains a lightweight and stable system optimized for payments, while programmable features and additional functionalities are being built at its periphery for those who need them.

It is not an Ethereum clone nor does it aim to compete as a Web3 application platform. Its strength lies in the smoothness of payments and the structure that allows tokenization, decentralized applications (DApps), and stablecoin use without compromising the blockchain’s scalability or security.

The XRP Ledger stands out when fast, cost-effective, and scalable transfers are needed – especially in payment traffic, where full programmability is not at the center. It offers users a stable platform where performance and usability are prioritized.

Ripple Payments and On-Demand Liquidity – A New Structure for Global Payments

Ripple Payments (formerly known as RippleNet) is Ripple’s global payment network designed to replace traditional, slow, and complex remittance channels with a modern, transparent, and efficient solution. It connects banks, payment service providers, fintech companies, and financial institutions in a common, seamlessly functioning system where payments move across borders in seconds – without the need for multiple intermediaries and high fees.

In traditional systems, international money transfers can take several days and pass through multiple banks. The customer may not know exactly when the payment will be received, how much they will be charged, or what the final exchange rate will be. Ripple Payments, on the other hand, offers near real-time visibility of all these: the payment route, price, duration, and exchange rate are known before any funds are transferred.

Ripple Payments' technological foundation consists of an API-based architecture that can be integrated directly into existing systems of banks and payment providers. This facilitates adoption since customers do not need to learn new user interfaces or processes; the service works in the background as part of the existing payment network.

On-Demand Liquidity (ODL) – XRP as a Bridge Currency

The most significant and innovative part of Ripple Payments is Ripple’s On-Demand Liquidity (ODL) system, which makes XRP an active part of international money transfers. The basic idea of ODL is that payment liquidity is no longer tied to static currency reserves around the world but can be dynamically obtained when a transfer occurs.

Traditionally, banks and financial institutions must maintain separate accounts in various countries' currencies to ensure that money can be sent quickly to the recipient. This system ties up vast amounts of capital, incurs costs, and requires constant management.

ODL eliminates the need for such arrangements. For example, if a U.S. bank wants to send $10,000 to a recipient in the Philippines, the process works as follows:

1. Bank A converts dollars into XRP on a U.S. exchange.
2. XRP is transferred via the XRP Ledger in seconds to the Philippines.
3. Bank B converts the XRP into Philippine pesos on a local exchange and sends the funds to the recipient.

The entire process takes virtually no time and occurs without either party needing to hold currency reserves or wait for bank hours. The transaction is also fully traceable, and its costs are known in advance.

This technology is particularly beneficial for developing markets where banking systems can be more unstable or fragmented. As a result, Ripple has focused on Southeast Asia, Latin America, and Africa, where the need for efficient currency transfer solutions is most pressing.

The use of ODL has grown rapidly in recent years, with Ripple reporting transaction volumes rising by several hundred percent year over year. This shows that XRP’s role is not just theoretical; it is being increasingly used in real payment transactions.

Additionally, Ripple has formed partnerships with entities that manage the money flows of millions of people, such as Tranglo, SBI Remit, and Lemonway. These partners enable ODL to be adopted in local markets and act as a bridge between traditional and new payment systems.

XRP's Practical Applications in Payment Traffic

XRP's most significant strength lies in its practicality for international money transfers. While traditional systems like SWIFT are slow, expensive, and dependent on multiple intermediaries, XRP enables near real-time and affordable transfers between two different currencies. This is achieved by using XRP as a bridge currency, which acts as a value transfer mechanism between two countries' fiat currencies in seconds.

RippleNet's internal service, On-Demand Liquidity (ODL), uses XRP as a source of liquidity. It removes the need to maintain large currency reserves in different countries, which saves significant costs for financial institutions and frees up capital. In practice, banks and payment services can perform currency exchange and transfers dynamically without dedicated accounts or complex intermediary chains.

XRP is already being used concretely: for example, Tranglo, SBI Remit, and Lemonway use it for transfers between Asia and Europe. XRP's speed and cost-effectiveness also attract fintech companies and central banks, which are exploring digital currency solutions and modernizing payment systems.

XRP thus provides not only a technical solution but also a truly scalable option for enhancing global payment traffic – without complex and outdated systems.

XRP as an Investment

XRP attracts investors because it is not only a cryptocurrency but part of a broader effort to integrate blockchain technology into international payment traffic. While many crypto projects focus on decentralized applications, XRP’s use is primarily driven by institutional approval and practical commercial applicability. This makes it an exceptional but by no means risk-free investment asset.

XRP has been around for over a decade, and its position among the largest and most well-known cryptocurrencies has remained despite multiple market cycles. Many investors see XRP as an opportunity to participate in the "institutionalization" of blockchain technology – a situation in which cryptocurrencies become part of the global financial system's structures. Solutions developed by Ripple, such as Ripple Payments and On-Demand Liquidity, are operational in practice, with XRP as a key component.

However, it is important for investors to note that investing in XRP tokens does not directly invest in Ripple. XRP's value may rise if Ripple succeeds, but it is not a direct equity or ownership share in the company. Nonetheless, many investors see XRP's growth potential as linked to Ripple's commercial and technological successes.

One of the biggest risks with XRP has always been regulatory uncertainty. The SEC lawsuit against Ripple has been partially resolved in XRP's favor, but potential future regulatory decisions in the U.S. or elsewhere could affect its usability, trading, and liquidity.

Additionally, XRP raises concerns among investors about centralization, as Ripple still manages a significant portion of the XRP tokens. While most of these tokens are locked in escrow agreements and are released gradually into the market, this can still cause selling pressure and price volatility, especially during uncertain market times. Like all cryptocurrencies, XRP is also a highly volatile investment. Its price can change rapidly due to market sentiment, macroeconomics, or technical news.

From an investor's perspective, XRP offers the chance to benefit from the commercial adoption of blockchain technology. XRP is not a speculative meme coin but one of the few projects designed to integrate with the current financial system. This makes it especially interesting as a long-term investment for those who believe in the development of digital value transfer as part of the traditional economy.

Summary

XRP is a blockchain-based cryptocurrency designed to address inefficiencies in international payments. Unlike many other cryptocurrencies, XRP is not trying to replace the traditional financial system but rather complement it with more efficient technology. At its core is the XRP Ledger, a lightweight and fast blockchain without mining, and Ripple’s commercial payment platform Ripple Payments, where On-Demand Liquidity (ODL) uses XRP as a bridge currency.

XRP’s story began in 2012, when its development started with the goal of addressing Bitcoin's issues with speed and energy consumption. The result was the XRP Ledger – a decentralized and energy-efficient blockchain, and Ripple, whose task was to create technology for practical financial applications. XRP's position in the market strengthened significantly in July 2023, when a U.S. court ruled that XRP is not a security in public trading. This decision removed a major regulatory obstacle and paved the way for broader adoption, increasing trust and liquidity.

From an investor's perspective, XRP offers a mix of potential and risks. Its strength lies in real use cases and institutional acceptance, but challenges remain, including the regulatory environment, Ripple's large token reserve, and general cryptocurrency market volatility. Still, XRP can be seen as a long-term opportunity for those who believe in the integration of blockchain technology into the global financial market.

Sign up now to invest in XRP