Aside from Bitcoin, it is also a good idea to look into altcoins. Ripple, for instance, is showing great potential over the last months. In fact, despite the challenges that it had this year, there were many developments in Ripple that are worth looking into. You have the Ripple product xRapid that is being used to lessen the cost of cross-border transactions. Also, you have the fact that Ripple has acquired an ex-Google developer on its team.
During an interview with Ripple Chief Market Strategist Cory Johnson on the Fintech Focus podcast, he calls XRP as “Bitcoin on steroids”. He even mentioned that it was like “Bitcoin 2.0”.
He offered some insights regarding the partnership that they’ve made with banks and traditional finance institutions. He said that “We’re trying to solve this really big problem, which is moving money across borders. It is insane in this era of technology when I can send a text message to a friend in Rome with emojis and gif attached to it, or I can send an email to a friend in Cape Town, South Africa in three seconds with an Excel spreadsheet attached and all kinds of information, but I can’t send anything of value. I can’t send value or money with anything less than 500 or 600 basis points of cost, and it’ll take me three to five days”.
What Makes Ripple a Good Thing?
Ripple can solve this problem. It offers businesses with a quick payment solution that also implements anti-money laundering efforts. This ensures that the funds are delivered safely and can reduce the tendency that it is used by criminals.
But is it really better than Bitcoin? Bitcoin has been designed as a payment for goods and services. It has been known to be accepted by merchants and has shown stability in recent weeks which could even drive its adoption. As for XRP, it works along the line of a system such as SWIFT, which is a bank service network for the secure transfer of international payments. Though Ripple targets cross-border transactions, Bitcoin has remained to be the most popular choice.
Controversies on Ripple
Also, there are the controversies surrounding Ripple. For instance, there were the lawsuits that claim XRP as a security. These lawsuits may have prevented the US Securities and Exchange Commission to outright declare XRP as a commodity. Instead, the agency mentioned Bitcoin and Ethereum as commodities. There were those who are questioning XRP if it is truly decentralized. Imagine more than half of the world’s XRP tokens are in escrow that is held by Ripple’s chief executives.
Johnson mentioned during the podcast that “I think when the SEC takes a good hard look at this, and we know that they’re starting to do this work, they’re going to recognize that the crypto asset is so clearly not a security”.
Ripple is currently third in the list of top cryptocurrencies today. It even had the chance to take the spot of Ethereum in two occasions. Could it one day take Ethereum’s spot? Will it get adopted by more banks and institutions?