A guy goes by the Twitter handle of “Crypto King,” but this post is not about him. In the crypto space, there’s a throne being currently occupied by Bitcoin, and as you can guess, there is a long queue of pretenders to the throne. Why should Bitcoin be “Crypto King”, and what’s this debate about XRP vs Bitcoin?
Just a day ago, a headline rattled the throne: Ether is outperforming Bitcoin by the greatest amount this year since the native token of the Ethereum network was launched in 2015 as an alternative to the original cryptocurrency.
Ether overtakes Bitcoin as the king of crypto with 530% return so far this yearSource: Fortune
As the concept of cryptocurrencies gets more popular and relevant, more and more digital coins are making their way into the market. There are assets like Bitcoin, Ethereum, Ripple, and Cardano that continue to make waves in the sector of virtual currencies. However, every crypto is distinctive in its way. They have different features and attributes that complement their usage in the public and business sectors. With the increasing popularity of blockchain technology, digital currency can replace fiat currency in the longer run.
Bitcoin and Ripple are two of the most popular digital tokens in the cryptocurrency market. Lately, they have received a lot of attention from investors. Ripple’s XRP has grown tremendously in the last few years, and it certainly can upscale as more and more users are joining the Ripple network. However, the debate of Ripple vs Bitcoin has remained relevant to the crypto community. Both coins have several similarities and key differences, which will be discussed in detail in this article.
What is the Ripple network?
Ripple is a private company that uses the RippleNet network to manage transactions and payments of its native coin, XRP tokens. It also acts like a crypto token and a payment settlement coin at the same time. Back in 2011, the developers of XRP initiated the project to make an alternative to Bitcoin. The team of developers included Jed McCaleb, David Schwartz, and Arthur Britto. They wanted to improve the computing power factor in the new crypto token. They aimed that the coin would be easier to produce and could be feasibly used for payment settlements.
These developers came up with a distributed ledger, also known as the XRP ledger. This XRP ledger is a shared database that can be accessed by several people in different locations. They act like validating servers for the XRP cryptocurrency transactions. They have to form a consensus to complete the transaction validation process. The distributed XRP ledger also consists of open-source code-named XRP.
Ripple Network uses the XRP ledger to make money transfers via virtual currency, using the RippleNet system. Ripple XRP facilitates transfers for international payments by partnering up with different banks and financial service providers that comply with local jurisdictions. The higher transaction speeds of XRP tokens are one of its most attractive features.
What is the Bitcoin blockchain network?
Bitcoin is the oldest and the most valuable cryptocurrency token globally, launched in 2009 by Satoshi Nakamoto. It has helped in popularizing the idea of decentralized digital currency in the modern world. The bitcoin network has grown massively over the users. Even though the concept itself is only a decade old, it has grown in terms of valuation and market capitalization, posting mammoth results. The number of bitcoin users has also increased by a significant margin, as people from all over the world eye its profit potential.
The Bitcoin white paper stated that Bitcoin’s supply is limited to 21 million coins, and it also gave birth to the mining concept in the financial system. Bitcoin provided a way out for consumers from the faulty traditional payments mechanism of financial institutions. Different currencies have followed the path of Bitcoin to take an entry into the crypto market. This is why Bitcoin acts as a leader and trendsetter in the crypto space.
The Bitcoin blockchain ledger also depends on several participants who have direct access to the same data set. This helps the network to maintain high security and decentralization. As financial institutions have no central authority or control, the Bitcoin network gains more transparency and legitimacy.
Bitcoins are created by a mining process, as miners are rewarded for solving a complex computational math problem to verify transactions. As a list of transactions is added to the blockchain, the miner is rewarded with 6.25 bitcoin.
Ripple vs Bitcoin: Supply and coin issuance
There are several key differences between Bitcoin and Ripple. Even though both cryptocurrencies follow the same blockchain concept, they differ in characteristics and features.
Ripple XRP had a total supply of 100 billion XRP tokens when it was first minted. However, the network releases them periodically in the market. About 45 billion XRP tokens are in circulation in the market, and the remaining 55% are held by the Ripple network.
On the other hand, Bitcoin is currently mineable and its supply is not controlled by any organization or authority. The upper limit of its supply is capped at 21 million, out of which over 18 million bitcoins are already in circulation.
Ripple controls the issuance of XRP tokens and releases them according to its plan. It also rewards contributors who validate transactions on the network. Bitcoin can be mined by anyone who solves computational math problems on the computer.
Ripple vs Bitcoin: Transactions
The Bitcoin network depends on the use of blockchain technology and the mining process to validate transactions. On the other hand, Ripple uses a combination of consensus ledger and validators for confirming transactions on the network. Bitcoin transaction confirmations and XRP transactions are different as BTC utilizes miners.
Ripple has tried to offer premium financial services along with speedy and cheaper transactions. As a result, Ripple labs allow high-seed and low-cost digital currency exchange, remittances, and payment settlements. XRP remains decentralized throughout its validation and escrow account management process. Bitcoin operates as a decentralized digital currency that focuses on fighting its war against centralization and censorship. The speed is slow for Bitcoin to have confirmed transactions.
Transactions for XRP are confirmed within seconds, whereas, for Bitcoin, they can take ten minutes or more to process.
Primary use as a currency exchange
Ripple is built to be used as a currency exchange. Ripple XRP helps with transactions and payments, and it can revolutionize the entire payment industry by providing a new and more effective mechanism via the digital economy. By being both a cryptocurrency token and a payment gateway, Ripple XRP has ensured its usability and feasibility for the consumer sector. Ripple acts as an effective alternative to the faulty mechanism of any central bank.
Bitcoin eliminates the role of any third party or middleman that could control its supply and demand. It has extensive use cases and can be easily used for payments, transactions, and as a form of investment or trading. These use cases have led to an increase in the popularity of Ripple XRP and Bitcoin.
The Ripple network is being used by over 300 financial institutions all over the world. The adoption of the network is increasing majorly as firms and organizations continue to explore the usability features of the ecosystem. Ripple is growing to become a preferred choice for money and payment transfers for institutions.
Bitcoin is already topping the charts for popularity. It has experienced adoption in businesses that offer goods and services. Also, it is considered to be a profitable investment. Thus, Bitcoin is widely used as an asset. The Ripple network mainly focuses on increasing its adoption rate by providing more use cases, but BTC stands as the most profitable store of value in the market.
Ripple vs Bitcoin: Tokenomics and value comparison
Ripple’s XRP is currently valued at $1.05. It has a market cap of over $49 Billion, and with a supply of over $47 billion coins, it stands at number seven for the list of largest cryptocurrencies in terms of market cap. Previously, XRP achieved an all-time low of $0.0028 in 2014, and it touched the all-time high of $3.84 in the year 2018. The coin has been unable to breach the $2 mark in the last 52 weeks or so.
On the other hand, Bitcoin is currently valued at around the $59,000 mark. With a market cap of over $1.1 Trillion and a circulating coin supply of 18.88 million BTC, it is the number one cryptocurrency token globally. Bitcoin has a dominance of 42% in the market, and it is the most significant digital asset in the world. The leading crypto token started from a few cents and is now valued in thousands of dollars.
Both of these cryptocurrencies are considered to be the top guns of the market. They hold their strong positions and significance in the digital asset industry. Though Ripple cannot compete with the prices and statistics of Bitcoin, it can surely fight BTC in terms of usability. Both networks are trying hard to become more relevant and usable to the consumer sector.
Both tokens can be used for payments and transactions; however, Ripple seems to be a more suitable option with speedy transactions and lesser fees. But in terms of investing and trading, Bitcoin provides much higher profit potential. However, Bitcoin is more suited for large-scale investors, whereas Ripple can opt for a small portfolio.
There might be no solid conclusion to the debate, but it can be said that both BTC and XRP are here to stay. They will drive the market trends in the coming times, and they will attract several users into the new market.