People keep telling me to get into Ripple. What is Ripple and how does it compare to say Ethereum?
To understand ripple you must separate XRP (the crypto coin) and the company ‘Ripple’. When you buy ripple you’re actually buying XRP. XRP is a blockchain protocol. The company ripple own tonnes of XRP and plan to get rich as the value goes up, effectively how an ICO works (which is how the initial capital was raised coincidentally). The XRP is used to ‘fuel’ transactions which make moving money around the world on a Protocol more efficient than the usual old fashioned international bank transfer. Once the transaction is complete the XRP is used up and ceases to exist.
So in buying ripple you are buying into a conventional banking tool. This isn’t a bad thing in the traditional sense as we use bank tools all the time and this is the blockchain technology being used less pioneering way than say Ethereum.
Etha is designed to fuel the Ethereum protocol of smart contracts. Smart contracts are like the idea of new form of writing, where as XRP Ripple is like improving the technology accorded to making paper. They both serve their purpose but you’re not necessarily investing in the same concepts.
So where does that leave the value and reasoning to invest: in my opinion the long term benefits and uses of Ethereum will render it by virtue of underlining a new internet, infinitely more valuable than a simple bank transfer system. It’s like investing in a company that makes keyboards and a company that runs the operating system. Logitech vs Microsoft.
Ripples recent rise has been due partly to its adoption by various Japanese banks. As of July 61 Japanese banks have adopted the protocol which represents 80% of Japanese banking. The system is much better than the current transfer system but with blockchain tech, surely the use of banking in the traditional sense will cease to have the influence it once had and the value of ripple will pale in comparison to the overall blockchain picture. For now though, it has legs.