XRP/Ripple – The New Financial System


It is no mean feat to grasp the concepts and techno-jargon and a recent survey indicated that only 8% of professional financial advisors can even articulate these concepts and ideas.

Since the advent and early successes of Bitcoin we now have thousands of alternative cryptocurrencies all vying for our attention and ‘belief’ in their machinations and potential for financial harmony for mankind.

Why Are There So Many Cryptocurrencies?

The majority of cryptocurrencies today are derived in some form or another from Bitcoin, which uses open-source code and a censorship-resistant architecture. This means that anybody can copy and tweak the code and create their own new coin. This also means that anybody is free to join its network or transact in it.

Why Are Cryptocurrencies Important?

As decentralized platforms, blockchain-based cryptocurrencies allow individuals to engage in peer-to-peer financial transactions or enter into contracts. In either case, there is no need for some trusted third-party intermediary such as a bank, monetary authority, court, or judge. This has the potential to disrupt the existing financial order and democratize finance. The size of the cryptocurrency space has grown exponentially in the past decade, with new innovations and a collective market capitalization of more than $1.75 trillion.

What Are Some Other Important Cryptocurrencies?

Many cryptocurrencies have gained importance or hold the promise to do so. Dogecoin, for example, was a meme-based joke coin that reached fame when Tesla CEO Elon Musk promoted the token on social media. The ten most important cryptocurrencies are currently listed as

1. Bitcoin (BTC)

2. Ethereum (ETH)

3. Tether (USDT)

4. BNB (BNB)

5. USD Coin (USDC)

6. Ripple (XRP)

7. Cardano (ADA)

8. Terra (LUNA)

9. Solana (SOL)

10. Avalanche (AVAX).

Aside from Dogecoin and the others listed above, several other Bitcoin forks also exist, such as Bitcoin Gold and Bitcoin SV.

History Of Ripple (XRP)


XRP came into existence in 2012 with a 100 billion supply. Of which, 20 billion XRP were retained by the creators (Jed, Chris and Arthur – also founders of and shareholders in OpenCoin) and the remaining 80% were gifted to OpenCoin, Inc. According to a post to the old xrptalk.org forum by Jed McCaleb from May 2014 his personal share was 9 billion. It is thought that Chris Larson’s share was 7 billion XRP. Whilst criticism is made of the percentage of XRP that the founders gifted to the OpenCoin company, it was in the context of a very different funding era, where although OpenCoin had secured approximately $9 million in venture capital funding, that was a very small budget in Silicon Valley start-up terms and certainly compared to more recent ICO (Initial Coin Offering) fundraising. That funding would not last long-term therefore the OpenCoin team knew they would need more resources to continue to develop both the public XRP Ledger and their own commercial product suites. Hence the founders gifted almost all of their XRP to OpenCoin, Inc. Most of this has now also been placed in a cryptographically-secured escrow account to create certainty of XRP supply at any given time and alleviate concerns that this could just be “dumped” on the market.

Long before there was any concept of an ICO, there were also public giveaways (or airdrops) of XRP on Bitcointalk forums. At least one of these receivers seemed to exchange them for Bitcoin fairly quickly, however, something which in hindsight he may or may not regret? Other airdrops and charitable cause giveaways continued into late 2013 too, all designed as methods to promote XRP adoption in contrast to later fundraising methods used by other crypto projects.


The airdrops to forum participants created a great deal of interest and “buzz” around the digital asset, even the likes of Vitalik Buterin and Eric Voorhees can be seen posting their XRP addresses in the thread to claim the airdrop. However, it was not without its critics. According to posts in the Bitcointalk forum itself, early Bitcoin investors apparently concerned that this initial success was going to lead to XRP dominating the cryptocurrency space (therefore impacting their investments) began offering bribes of over $500 (5 BTC at the time) to say that XRP and Ripple were a scam.

Strengths and Successes

XRP then began to increase its trading volume, though initially dependent on a small number of exchanges, including Bitstamp and Gatehub. The volumes were

small compared to today’s standards, but an important step in establishing XRP as one of the most widely exchanged crypto currencies post 2016.

The XRP Ledger is fast, settling payments in 4 seconds and aiming to improve on that. That’s hard for anyone to beat. It can handle 1,500 transactions per second 24/7 and can scale to handle the same throughput as Visa. It has a minimum transaction fee of just 10 drops (0.00001 XRP or approximately $0.0000044 at current rates). This is not paid to any party however and is irrevocably destroyed as an anti-spam feature (along with the XRP account reserve balance) designed to make it prohibitively expensive to DDoS (Distributed Denial of Service) the XRP Ledger network. Whilst the transaction cost is barely existent, there are others who offer a zero-transaction fee.

The XRP Ledger has proven security and stability being the only public blockchain that has experienced no reversed transactions, no censorship, and no major operational issues for over five years, making it ready for institutional and enterprise use. All of the over 40 million ledgers have been closed without issue since inception.

Controversy and Regulation

There is also perceived regulatory uncertainty surrounding XRP with many in the crypto community wishing to define it as a security. Whilst there has been no definitive ruling, others who have practiced in corporate and securities law suggest this is unlikely. Furthermore, supporters have pointed out that following the FinCEN (Financial Crimes Enforcement Network) case against Ripple Labs and its XRP II subsidiary in 2015, FinCEN declared XRP a currency, not a security. As FinCEN has already signed an agreement with Ripple, allowing them to continue their XRP sales, if XRP is an unlicensed security then FinCEN now must explain why they signed an agreement allowing the sale of said unlicensed securities. Perhaps we will see further clarity once the current pending lawsuits surrounding this matter have been heard. Perhaps they were simply delaying tactics to an inevitable announcement too?


Whilst many take a different viewpoint and are right to continue to ask questions of Ripple the company, evidence suggests that XRP should be considered a cryptocurrency like any other (or digital asset if you prefer). Decentralisation concerns are understood, however, I believe the transparency provided by Ripple regarding their involvement and holdings, the solutions they have put forward and the growth in independent validators all over the world answer those sufficiently. The perception of many won’t change, as it’s easier to believe and regurgitate sound bites from popular forum members or activists from one coin community or another than to conduct your own research. And that happens both ways too. It’s also partly a symptom of “The Highlander Syndrome” that seems to have built up in this industry that there can be only one and so others are disregarded or mocked. Let’s be most impressed by Ripple’s stance that building bridges and interoperability are more important than building walls. Mainstream adoption won’t come to an industry of in-fighters. It will come to an interoperable system with a history of delivery where assets compete on a level playing field to provide a realistic option to move away from the traditional systems of the past. But that’s just my 2 XRP’s worth.


Ripple as of March 2022 has signed partnerships with over 300 financial institutions in at least 45 countries worldwide. Some of the main partnerships are Santander, Bank of America, American Express, Standard Chartered, Qatar National Bank (QNB), Bank of India, The Canadian Imperial Bank of Commerce, and Cambridge FX to name a few. Several banks are unique to Ripple, which include MUFG, BBVA, SEB, Akbank, Axis Bank, YES BANK, SBI Remit, Cambridge Global Payments, Star One Credit Union and eZforex according to the wiretapping giant’s release.com. Payment service providers can now join, which is incredibly interesting. More interesting is that currently 38%+ of the World’s top 100 banks have joined Ripple!

Online sources – www.quora.com, ripple.com, bitcoinfoundation.org, bitcoinexchangeguide.com, plan99.net, classic.ripplepay.com, xrp.hodor, xrp.world, ethereumworldnews.com, index.co, ryanfugger.com, en.wikipedia.org, forbes.com

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