Bitcoin vs Ripple Battle for #1 Spot: Main Differences Between BTC and XRP Cryptocurrencies
Bitcoin was developed based upon a peer-to-peer electronic cash system in 2009 and it quickly became one of the first cryptocurrencies to be secured by cryptography. Those who hold bitcoin can send and receive the coins amongst one another and transactions are recorded on the blockchain, which is a public ledger. Once the transaction is recorded, it cannot be altered, removed, or modified in any manner. The transactions are also confirmed to be secure due to the mathematical equations that miners must solve. Bitcoin functions as a digital currency that can be transferred on a peer-to-peer network. It can be used as an alternative to traditional currency.
On the other hand, XRP is a coin that came after bitcoin – in about 2012. The coin was launched by Ripple, which focuses on improving the international payment process between banks. Ripple developed the XRP Ledger, which operates as a peer-to-peer system. The coin provides liquidity for banks and payment providers for international payments. Ripple works as a system that allow for faster and cheaper money transfers.
Here Are The Main Differences Between The Two Currencies:
To start, both have different purposes and ideologies. Bitcoin is for peer-to-peer transactions and it is not necessary to have a third party to oversee the process. This can mitigate the need for oversight by banks and financial institutions. On the other hand, Ripple functions rather differently. Ripple focuses on helping banks become more efficient in the global transfer system.
Second is decentralization. Bitcoin is based on the idea of decentralization and it is one of the main drivers of bitcoin’s success. It is an open-source currency system that is based upon community support. Alternatively, Ripple is owned by a private company and unlike bitcoin, it has received criticism for its lack of decentralization.
Third, is supply. As many know, Bitcoin’s supply will always be at 21 million coins and 17.3 million BTC. The community expects that all of the bitcoins will be mined by 2140. As for XRP, it has a supply of 100 billion tokens. Each time a transaction takes place, the token supply decreases because the XRP is destroyed.
Fourth, transaction times and fees are another point of contention. It takes 10 minutes for bitcoin to confirm a transaction and processing times can take much more time. Further, the average fee for a transaction is $0.50 to over $50. XRP transactions are substantially cheaper – about $0.01. Each transaction is confirmed in four seconds, which means that the platform has a capacity of 1,500 transactions for every second.
Finally, wallets are crucial to bitcoin. To store bitcoin, users must set up a wallet. The same applies to XRP. There are many wallets available for bitcoin, but XRP is not very diverse, so there are not many options that provide support.
Overall, there are many differences between XRP and Bitcoin and are ones that investors may want to keep looking at going forward.