How to mine Ripple
Ripple has no mining or miners whatsoever. I’ve known where to buy Ripple and where. So, the question of how to mine Ripple is often astonishing. Instead, transactions are powered through a “centralized” blockchain to make it more reliable and fast. Mining is a core principle of most other cryptocurrencies, and each uses its own system to determine how much power the miners have.
Since you cannot mine Ripple, the only option is to mine other Cryptocurrencies first and then look for exchanges that help you convert your BTC to XRP. In this way, you can lay your hands on XRP directly without having to pay for the Ripple mining process separately. Many people have already started buying XRP owing to its advanced structure and the gradual increase in its price.
In this guide, you will learn:
- XRP as a “Bridge Currency”
- Use of XRP as an intermediary
- RippleNet gateways payment process
- The four components of xCurrent
- Interoperability of xRapid and xCurrent
- Ripple FAQs
- Ripple Mining
XRP as a “Bridge Currency”
Ripple is a federated crypto-ledger infrastructure built to integrate with banking and financial institutions in facilitating fast, cheap cross-border and cross-currency payments and remittances. It was launched in 2012 by Ripple Labs Inc. and has since been adopted by many banks and payment processor networks (and has formed partnerships with the likes of Moneygram).
The system’s native token, XRP, is a digital bridge currency intermediating and facilitating trades in any other currency. Supply is also not fixed as sending transactions in the XRP Ledger destroys small amounts of XRP (depending on network usage, etc.)
Require a system so parametrized and game theoretically aligned so as to incentivize actors to invest computational resources to secure the network and get cryptocurrency in return for the service.
Ripple is a for-profit entity targeting institutional and not retail investors and as such doesn’t require the mining process, but depends on the businesses and institutions incentivized by the business problem Ripple is solving for them.
RippleNet consists of collectively trusted subnetworks that together form the larger network and there are overlapping sets of corresponding validators. In turn, these validators within efficiently agree on the order of transactions and state of the ledger, needing minimal connectivity to maintain the network-wide agreement.
Some tokens are sold off to institutional investors and some programmatically on exchanges, but in general, the purpose of XRP is such that retail investors have little use for it or reasons to purchase large amounts of the token.
Use of XRP as an intermediary
In other words, XRP is FinTech that aims to service institutional players, such as banks and international banking institutions. XRP is designed to substitute SWIFT and SEPA systems to integrate with existing financial infrastructure easily.
In other words, XRP is FinTech that aims to service institutional players, such as banks and international payment networks and as such is built to easily integrate with existing financial infrastructure and not design a parallel one. It makes use of a number of international money-transfer solutions and RippleNet gateways – xRapid, xCurrent, and xVia. xRapid is a mechanism for mostly fiat-to-fiat settlements using XRP as an intermediary
xCurrent settles payments in XRP.
RippleNet gateways payment process
A payment with xRapid follows the trajectory of a financial institution connecting directly to a digital assets exchange in both originating and destination corridors. The originating currency is exchanged into XRP which provides the necessary liquidity to power the final payment, and then in seconds that XRP is exchanged into the destination currency in the second digital asset exchange.
Once this transaction takes place, the funds are sent out on the local rails of the destination country for payout. The transaction is tracked end-to-end, and the result is a cross-border payment that is much faster and cheaper than anything before it.
All members of RippleNet are also connected through Ripple’s standardized technology, the already mentioned xCurrent.
The four components of xCurrent
- Messenger is the API-based bidirectional messaging component that connects to the beneficiary bank’s Messenger instance to exchange KYC and risk information, fees, FX rates (if applicable), payment details and expected time of funds delivery. It packages this information and presents the entire cost structure to the originating bank, providing unprecedented visibility into the total cost of the transaction. Additionally, banks can set fees and the FX rate for payments made with Messenger. FX rates are set in FX Ticker and queried by Messenger during the quoting process.
- Validator is the component which cryptographically confirms the success or failure of a payment. It coordinates the movement of funds across ledgers of transacting parties in a manner eliminating settlement risks and reducing delays. Validator provides a single source of truth for the transacting counterparties while preserving the privacy of banking customers’ identifiable payment information. Banks have the option of running their own Validator, using it for all their transactions, or relying on a Validator run by the transacting counterparty.
- ILP Ledger is a sub-ledger of each transacting bank’s general ledger. This component of xCurrent is utilized to track the credits, debits, and liquidity across the transacting parties. ILP Ledger enables transacting parties to settle funds atomically, which means the entire transaction settles instantly or not at all – no matter how many parties are involved.
- ILP Ledger enables funds settlement in milliseconds. Further, the settlement risk is eliminated because the payment processes entirely or fails upfront. ILP Ledger is designed to provide transacting banks with 24/7, on-demand availability. The combination of these capabilities allows banks to profitably offer low-value, on-demand cross-border payments products and services.
- FX Ticker is the mechanism facilitating the exchange between ILP Ledgers by enabling liquidity providers to post FX rates. This component provides the exchange rate between any pair of ledgers with which it is configured. Additionally, it keeps track of the account, currency and authentication credentials for each configured ILP Ledger.
To enable cross-currency flows via xCurrent, banks can leverage their existing nostro/vostro relationships with other banks and provide liquidity through their FX trading desks, or use external market makers to provide FX liquidity for exotic currency corridors.
This example will refer to that function as the liquidity provider, whether it is the bank’s FX organization or an external market maker. The settlement is an atomic process, meaning that both intra-bank settlement legs of the transaction happen at the same time so as to eliminate the settlement-leg risk.
xCurrent is typically installed on-premises behind the corporate firewall of a bank, with a load balancer handling inbound connections to Messenger and a proxy server handling inbound and outbound connections to all xCurrent components. Banks can deploy multiple instances of the xCurrent behind the load balancer to scale to the volume of payments.
By joining Ripple’s growing, global network, financial institutions can process their customers’ payments anywhere in the world instantly, reliably and cost-effectively.
Banks and payment providers can use the digital asset XRP to further reduce their costs and access new markets.
Interoperability of xRapid and xCurrent
xRapid and xCurrent are interoperable and made to be used together (Ripple plans on offering one convergence solution) while xVia is a gateway that provides access to RippleNet via a single standardized API. The API enables users to seamlessly send payments globally with transparency into the payment status and with rich information, like invoices, attached.
The attached data to payments eradicates verification and reconciliation issues. xVia enables direct connectivity to receive correspondents and affords bi-directional messaging to confirm FX and fees, submit payout requests and verify payout completion. It requires funding in the local or payout currency.
The XRP token in these settings provides instant liquidity pools for facilitating fast and cheap payments. The first part of the transaction takes just 2-3 seconds and the conversion of XRP through digital asset exchanges and/or local payment processors, the entire transaction takes about 2 minutes in total.
The Financial Conduct Authority in the UK has also gone to categorize XRP as a utility/exchange token alongside Bitcoin and Ethereum. However, its technical purpose and role in the system make it a class of a digital asset that is not recommended as a “regular” investment nor meant to serve a function outside its specific context. It is meant instead to keep money flowing freely (as information) and unhampered by high transaction costs and processing delays.
22 Nov 2019
Ripple has now fulfilled another promise of building XRP liquidity. The company has done this through escrowing funds. Here, it is pertinent to mention that Ripple had promised its investors that it will escrow 55 billion XRP in cryptographically secure escrow account. The company had clarified that it had done so to create certainty of XRP supply at any given time. Now, the company has fulfilled its promise.
The crypto experts say that Ripple has given proof of responsibility. Also, the company has a tremendous track record of investing and supporting the XRP ecosystem. This attitude from Ripple has eliminated the chances of flooding the market. Moreover, this move from the company has built up the liquidity and trust of the digital currency in the market. The experts are also of the view that the value of the digital currency will increase and determined through their utility.
17 September 2020
Ripple has been overshadowed by tearaway bullish sessions experienced by both BTC and ETH this year, but bullish activity is to be expected.
The effects of ‘energy-guzzling’ and climate change are impacting Proof-of-Work (PoW) coins as energy use and sustainability awareness becomes progressively important. Thankfully, Ripple is a non-mineable coin that is far more energy efficient. This indicates that Ripple will continue to surpass PoW coins like Bitcoin and Ethereum over time as energy sustainability and global warming awareness increases. As it stands, Ripple continues to provide a low cost, reliable, instantaneous, and global cryptocurrency.
Is Ripple mined?
Ripple is not mineable — it’s something quite entirely altogether different from things that are mined. There’s no mining or miners there. It’s a federated crypto-ledger of mostly financial institutions and payment processor networks.
What is Ripple?
Ripple is an asset/payment system/investment. meaning the following: the function of the XRP token is as a relay bridge token for facilitating cross-border cross-currency payments fast and cheap.
What’s the use of Ripple?
It is crucial to maintain a low market price and so, Ripple is meant for institutional players and banks as an instrument, not a speculative investment for retail.