The cryptocurrency market is on a rollercoaster ride since the beginning of 2021. A plethora of crypto trading platforms has emerged recently to not miss out on capitalizing on the headwind of the decentralized money market. There are more than 5000 cryptocurrencies that are making overnight millionaires worldwide. And if you are still not expanding our vision beyond Bitcoin, Ethereum and Dogecoin, you need to think further because Ripple’s XRP token might soon add its investors into the rich list of Defi.
This cryptocurrency became the second biggest player after Bitcoin in 2020 but plummeted to unexpected lows after SEC filed a lawsuit against its creator- Ripple. The next hearing of the case is on May 21, 2021, and the defendants are already holding the ground strong to make Ripple Labs emerge triumphant in the battle.
So what exactly is Ripple and XRP, how does it work, how can you end up in its rich list, how is it different from other cryptocurrencies, what is the lawsuit about, and what is its future? We have covered it all for you here.
XRP or Ripple Coin- Your best crypto bet for the coming month
Have you ever wanted to wire money to a distant cousin in another part of the world, but your bank said that the transaction might take several days to reflect in their account? Well, that is the case with most banking systems right now since they all follow a standard set years before. Companies like Western Union, S.W.I.F.T, and MoneyGram are examples of slow, expensive, and relatively simple systems that financial institutions use to transfer money.
There isn’t even a direct channel of transfer of funds between the two banks in many of the cases. This necessitates third-party banks and channels, which makes the security of transactions a big issue, especially when a large volume of money is at stake.
Some transfers also involve multiple currency conversions that can make the transfers more costly and complex.
XRP address these concerns
Ripple is a currency exchange and remittance network created by Ripple Labs Inc back in 2012 for a digital community to carry monetary transactions. This ledger-based system allows secure and instant global financial transactions of any size without any translation charges. This ability to carry out charge-less transactions is something that is a major benefit compared to traditional banks.
This allowed every member of the network to extend credit to other community members, making each person a small bank in itself.
By 2013, the company had reported interest from various banks for using its payment systems. Since then, many financial institutions have used the Ripple protocol to effect transactions across the world. In December 2019, XRP became the second-largest cryptocurrency globally, with a market capitalization of $73 billion.
Now, what is XRP? After the widespread popularity gained by Ripple, it decided to introduce its own currency called XRP. So now you know, Ripple and XRP are not the same; in fact, the former is a privately held company while the latter is an independent cryptocurrency.
The RippleNet protocol RTXP aims to solve delayed and costly transactions by introducing its protocol that many banks and financial institutions are adopting already. Imagine the RippleNet as a network of dispersed computers around the world acting as nodes in that network. They exist to maintain decentralized ledgers and authenticate transactions. But unlike other cryptos, Ripple wallets let you transact both XRP coins as well as IOU tokens. This makes the XRP channel much more accommodating and convenient. Furthermore, transferring an XRP coin means that you can transfer an asset or store of value without the need to change it into a currency accepted by the payee.
Compared with Bitcoin, XRP transactions take on an average of four seconds per transaction compared to Bitcoin’s 10-minute average. XRP can also handle 1500 transactions per second, while Bitcoin can handle only seven. These are major benefits of using XRP tokens which put Ripple coins at an advantage over other cryptos.
The advantages of using Ripple coins as a means of payment are pretty obvious!
If Ripple is a cryptocurrency, can it be mined?
The answer is NO!
The number of Ripple coins in circulation is limited to 100 billion since its inception back in 2013. Since there can be no mining of these coins, the Ripple network is much more energy-efficient than its other counterparts.
What is the XRP lawsuit all about?
If you keep yourself updated with the cryptocurrency news and trends, you would definitely hear about the lawsuit filed by the SEC that proved to be the major roadblock on the upward graph of XRP’s popularity.
In December 2020, the Security and Exchange Commission filed a lawsuit against Ripple for making $1.3 billion by offering financial security for trading without listing it with SEC. The security being mentioned here is XRP, and to quote the accusation- “Ripple allegedly distributed billions of XRP in exchange for non-cash consideration, such as labor and market-making services.”
The lawsuit was filed against Christian Larsen, the company’s co-founder, executive chairman of its board, and former CEO and Bradley Garlinghouse.
Update on Ripple lawsuit and how can you be part of XRP’s rich list if it wins
It’s been more than 5 months that the Ripple vs. SEC lawsuit has been stretched, and there are no signs of the matter coming to a settlement. The details about the lawsuit on Thursday reveals that Ripple labs have now filed a Memorandum of Law in opposition to SEC’s “lack of due process” and “fair notice” criticism. Additionally, SEC has further accused Ripple lab and its founder and former CEO of “selective disclosure” to third parties.
Defendants highlighted the failure of SEC to prove the material defense of the accusation, disputed the issue of facts, therefore, requesting the court to not go by SEC’s facts.
Here are some of the key arguments from the defendant that came in this Thursday-
“The unproven “facts” the SEC attached to its motion are either disputed or irrelevant.”
“It [SEC’s narrative] bears no resemblance to the allegations in Ripple’s answer, which the court should take as true for purposes of this motion to strike.”
“The SEC cannot show prejudice, and accordingly, it cannot prevail on its motion to strike… The Court should deny the SEC’s motion to strike in its eternity.”
If Ripple Labs Inc. wins the lawsuit against SEC, it will not only turn thousands of XRP investors into overnight millionaires but might also replace Bitcoin as the king of the Defi market. Additionally, it will also undermine the authority and reputation of the SEC in being a watchdog of the financial market.
In April, Cointelegraph reported that Ripple might even file for an IPO if it wins the lawsuit against SEC, which is a major confirmation that XRP investors might emerge as the biggest winner of the crypto investment in a victorious scenario.
Ripple price chart movements
Some of the major price movements that have taken place historically in the XRP coin’s price are stated below, curated to see the major jumps specifically and falls in the price. A lot can be determined about the prices of stocks and cryptocurrencies based on their historical price movements, including when was the best time when XRP multiplied its rich list.
Released in 2013, the coin began to be widely traded on coin exchanges by February of 2015.
Feb 2015 – $0.01178
Mar 2017 – $0.02140
Apr 2017 – $0.05218
May 2017 – $0.24750
Dec 2017 – $1.98000
Jan 2018 – $1.13931
Mar 2018 – $0.50089
Dec 2020 – $0.21925
Jan 2021 – $0.49493
Mar 2021 – 0.56957
Apr 2021 – $1.59707
May 2021 – $1.46911