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                                        Ripple vs Bitcoin: Which is the Best Option For Investment

Ripple vs Bitcoin: Which is the Best Option For Investment

16 Aug 2021

Bitcoin has taken the cryptocurrency world by storm. Investors are looking for ways to get in on this new and innovative technology, but not everyone understands Bitcoin or how it works. On the other hand, Ripple is a newer cryptocurrency that many people prefer as an investment because of its stability. 

Bitcoin currency is a native cryptocurrency that has seen much good press lately due to its skyrocketing value. Ripple crypto also seems like a good choice with its low price point and fast transaction times, but it's not without drawbacks such as lack of decentralization which could put it at risk in the future. 

As early investors, you may be wondering which is a better investment option for your money. The answer to this question can depend on many factors, including your risk tolerance and when you want to invest. 

Read on to find out more about the difference between Bitcoin and Ripple and how they compare in terms of features so you can make an informed decision about which one fits your needs best.

Difference Between XRP and BTC

When comparing Ripple vs Bitcoin, several differences separate them from one another. XRP vs BTC is both used for the same purpose - to transfer digital currency value. BTC is primarily a unit used to store and transmit value. In contrast, XRP is more specifically designed to be a unit of account suitable for storing and transmitting the value. 

Bitcoin is a decentralized digital currency, which means that it's not controlled by one group. Bitcoin also focuses more on its resistance to censorship and centralization rather than other aspects like transaction speeds. 

One of the best features about XRP transactions is their fast confirmation time: they process in seconds. In contrast, BTC may take up to 10 minutes. 

Overview of the Ripple Network

Ripple is a well-established and one of the most popular cryptocurrencies, with its market capitalization in March 2017 being $258 billion. But what sets it apart is that it's not only conceived to be used as a digital currency like Bitcoin but also to facilitate transactions for banks and financial institutions. 

Like Bitcoin (BTC), Ripple also utilizes blockchain technology to keep secure transactions between users who are spread across the globe. 

Ripple is a technology-based cryptocurrency and digital payment that acts as an international money transfer system to facilitate payments. Ripple was co-founded by Chris Larsen, Jed McCaleb, and released back in 2012. 

They intended for it to somehow replace SWIFT with similar processes of dealing across digital currencies and financial transactions between mainstream financial institutions or any banking industry while still maintaining its currency (Ripple's).

The main purpose of the Ripple company is to streamline global transactions and "make cross-border payments faster and easier." In 2014, a pilot program was conducted by several major banks, including the Japan Bank Consortium and Mizuho Financial Group; these were among the first few major financial institutions that participated in testing Ripple labs.

One of the features that make Ripple stand out is its speed, unlike Bitcoin. Ripple offers fast payment networks without the high transaction costs. It only takes 4 seconds for a transaction to be processed using XRP tokens instead of BTC, which may take more than an hour or longer. 

The XRP payment system works to maintain the integrity of its system. Ripple does not use a proof-of-work of stake method. The consensus protocol solves double-spending without compromising account balances and processes transactions on the network.

Ripple is a technology that can act as an automated XRP ledger for financial transactions. The XRP ledger keeps track of all IOUs in a particular currency and makes the information publicly available on its consensus ledger, but it does not link any data to individual IDs or accounts.

In short, even if your transaction history is a public record, nobody will have access to your data.

The most recent major news about XRP  is the announcement by SAP that they have joined hands with Ripple labs to provide blockchain-based solutions for foreign exchange and global payments.

How To Invest In Ripple?

Choose A Broker

Ripple is leading a charge to revolutionize the way we handle our money. The Ripple platform is one of the fastest and cheapest ways to make digital transactions. You can purchase these for a low fee on various exchanges such as Bitstamp, Kraken, or GateHub.

Create An Account

Creating an account is on a case-to-case basis, depending on your chosen platform. In some cases, a verification ID is required.

Exchange or Buy Ripple (XRP)

The easiest way is through a direct transfer from one of the currencies to an exchange that supports both Bitcoin and Ethereum like Coinbase. Also, many major banks support several cryptocurrency brokers so you can buy Ripple directly. 

You can then trade your coins for tokens on their platform, such as Ripple's XRP tokens (XRPs). To get XRP cryptocurrency, you need BTC or ETH. You can also exchange your money for XRP on some platforms like Binance.

Overview of Bitcoin: An Innovative Digital Currency

Bitcoin is a highly volatile digital currency used for trading online in the virtual world. It has taken the world by storm as it was created to offer peer-to-peer transactions without any regulatory oversight. 

It means that no mediators or third-party auditors will verify the authenticity of transactions made through Bitcoin. On top of that, Bitcoin is the only privacy-centric cryptocurrency available on the market today.

Bitcoin has been in existence since January 2009. It was introduced as an idea by Satoshi Nakamoto, who developed the underlying code for Bitcoin on a public mailing list that is known today as SourceForge. 

Bitcoin is a digital currency that utilizes advanced cryptography to facilitate payments. These transactions are verified by "miners" who own the governing computing power and participate in Bitcoin's network of computers, known as nodes.

The miners receive new bitcoins for processing these transactions which can be used for a cryptocurrency exchange or trading digital currencies. 

In terms of Bitcoin transaction confirmations, a Bitcoin transaction is confirmed once a block containing that particular bitcoin transfer has been added to the blockchain. This process continues with every new block on top of it until there are so many blocks, transactions cannot be traced anymore.

Bitcoin is a type of cryptocurrency that keeps balances on an open ledger to ensure transparency. The value as a commodity doesn't exist because Bitcoin isn't issued or backed up by any bank or government. 

All payments are verified by computing power, and there's no physical bitcoin at all. Despite not being legal tender in most countries, it has triggered the release of hundreds of other cryptocurrencies called altcoins (alternative coins).

The main advantage offered by Bitcoin is the ability to make peer-to-peer transactions. It means that any two consenting parties can transact with each other without having a third party involved in their transaction.

The identity of both parties remains anonymous, and they are also secure as Bitcoin uses cryptography for added security.

How to Invest In Bitcoin?

Choose a Broker

Cryptocurrency brokers make the crypto market accessible to everyone. With an easy-to-use interface, all you have to do is connect your account with their brokerage, and they will purchase coins for you on exchanges.

Create an Account

Once you decide on a cryptocurrency broker or exchange, signing up to open an account is the first step. Depending on the platform and amount of money you plan to buy with your credit card, verifying your identity may be necessary to meet federal regulatory requirements and prevent fraud.

Deposit Cash

To participate in crypto exchanges, you'll need to make sure that you have the right funds in your account. With traditional banking, you might have to link your bank account or authorize a wire transfer. Thus, you can use your credit card or debit card.

Place an Order

To buy a cryptocurrency, you must enter the ticker symbol and how many coins you would like. For example, Bitcoin is BTC which can be purchased in fractions of shares with most exchanges or brokers so that it doesn't take thousands of dollars worth to own them.

What Are The Key Differences Between Ripple and Bitcoin?

Price and Speed

XRP transactions are fast and inexpensive. The current minimum transaction cost required by the network for a standard transaction is 0.00001 XRP (10 drops). At very low costs, you can buy XRP. The average bitcoin transaction processing fee roams around $23, according to Coindesk.

It makes them a much more practical currency for people to use in their everyday lives than Bitcoin, which is known as one of the most popular cryptocurrencies on earth but has long confirmation times that can make it difficult or expensive to transact with over time.

Not to mention, it is a more complicated and intensive nature against XRP. 

Ripple network is a fast and affordable way to send money anywhere in the world. Sending XRP coins to cost just fractions of a cent, making it easy for businesses and individuals alike to make payments with no more than 20 seconds delay at any time or location.

Coin Cap

The main difference between Ripple and Bitcoin is their coin cap. Ripple's main investors have released 1 billion XRP tokens gradually into the market. The Bitcoin network has an artificial scarcity and will only be capped at 21 million BTCs, which is what makes it such a valuable store of value for so many people.

Mechanisms and Processes

The Ripple network is so innovative that it doesn't use the blockchain mining concept to validate transactions. Instead, nodes in its peer-to-peer consensus system verify the authenticity of a transaction by conducting polls and ensuring no central authority is needed for confirmations. 

Because XRP remains decentralized, fast confirmation times are possible with little energy consumption - making this alternative currency an eco-friendly option.

Miners are incentivized to keep joining the network because they gain a steady stream of bitcoins based on their efforts. Miners also release new coins as and when they find them, which creates an unpredictable pattern for bitcoin mining.

The in-built smart contract that controls the release of XRP is what ensures a safe and secure future for this cryptocurrency. The inability to pump out more coins than are being sold creates an environment where the Ripple network can thrive without rampant inflation or currency devaluation from oversupply.

It also means it will take many years before all 100 billion crypto coins have been released, providing stability.

Major Financial Institutions

Founded officially in 2012, Ripple Labs is the San Francisco-based tech company that developed and launched its payment protocol. Originally called Opencoin, this firm rebranded to Ripple Lab when it became official around 2015.

In contrast, a debate between Bitcoin vs Stocks has been arising. Bitcoin and its underlying blockchain technology have been divisive, with some of the world's most famous banks moving to explore how it might benefit them including BNP Paribas, UBS, and Banco Santander.

Which is a Better Investment?

Investors are often debating whether Ripple (XRP) is a better investment than Bitcoin. It has been an interesting question to ask lately, with the price of Bitcoin skyrocketing once again and creating speculation that this may be ominous for future fortunes. Arguments in favor of Bitcoin typically focus on its price stability and longevity, whereas arguments for Ripple (XRP) often emphasize Swift's willingness to pilot it. Ultimately, though, which cryptocurrency is better depends on what you are looking for in an investment. 

If you're interested in long-term stability and security, investing in Bitcoin would be a wise decision. You should start investing in Ripple if you want to make quick profits while small details are ironed out.

Ripple vs Bitcoin Chart

Ripple and Bitcoin show promising results when viewed at a long-term perspective. While it is undeniable how volatile both currencies are on a short-term basis, looking at their sustained performances, both look good for prolonged investment patterns.

Ripple XRP had a lot of growth in 2018. Ripple is a private company, and no one knows how much it has under management or its revenue stream. Bitcoin is a decentralized currency which makes it secure. Also, Bitcoin has more investment than Ripple, creating trust in the platform.
Ripple vs Bitcoin Chart

The price for XRP at the end of 2017 was 3 cents. To assess the situation, we need to look at the chart. According to Coinbase charts, in December 2018, Ripple reached a peak price of $3.47. 

The rate of return on this investment is 87936% (it took approx three years). By comparison of Bitcoin vs Altcoin, Bitcoin showed an increase in value by thousands of percentage points. The BTC rate for December 2018 reached $3,300. 

The all-time high price of XRP is a fluid number, depending on the source you are looking at. According to various media reports and Coindesk, its highest value was $3.40 in early January 2018.

However, according to Coinmarketcap, there have been days where the coin reached above $3 per token or at least 100% more expensive than today’s market rate (based on an average from other sources).

The Bitcoin price has fluctuated wildly over the past few months, and it's tough to keep track. The latest information we have from Coindesk is that its highest point was $64,829.14 at some time in March 2021 (and they don't provide a date). By July 2021, things had fallen off considerably- the value dropped down to around $32K.

The energy consumption of Bitcoin and Ripple is still a debatable topic, but both are indeed heavily dependent on energy consumption. The Bitcoin evolution has been a roller coaster ride. 

In terms of XRP price predictions, Ripple's price has been steadily climbing over the last year. With a long-term forecast to reach $15 by 2027, Ripple may be a good investment. 

Bitcoin and Ripple: Price Fluctuations

The Ripple VS Bitcoin feud continues as price fluctuations become part of the argument. The entire cryptocurrency exchanges are currently experiencing a state of fear due to the fall in the price of Bitcoin. While many crypto analysts and editorial opinions have pointed out that this is not an indicator of a bubble burst, there are still concerns about investing in Bitcoins as people may panic and sell off their holdings when they see prices falling. 

It can also lead to a downward spiral where the price falls to unsupportable levels, leading to a crash.

Bitcoin is an asset class that can be highly volatile and risky. This volatility also applies in the case of Altcoins, and the prices also fluctuate here too. While some Altcoins are appreciating steadily like Ripple XRP, they may not have a high correlation with other assets or even each other.

Bitcoin and Ripple have had a lot of ups and downs in their prices over the last few months. While Bitcoin hit its high around $19,000 in December 2017, it has since then been on a downward spiral with no bottom in sight until now. 

Ripple XRP reached its highest point of $3.3 in January 2018 but fell to around $0.90 in a matter of days. While this volatility is not good for those who are looking at the short-term returns, it does make sense for long-term investors because they can buy coins while prices are low and sell them when their price increases.

Bitcoin and Ripple: Market Cap

Bitcoin is one of the best-known cryptocurrencies in circulation today. It has a current market cap of $600 billion as of June 2021. Ripple also holds a place among the top ten currencies by market capitalization with an overall value of $40 billion (as of June 2021).

It is a significant development that these two currencies have such high market caps and are in competition with each other. However, it is also worth noting that certain fundamental differences between the two could help investors make better decisions about investment options.

Both XRP and BTC have limited supply and are largely unregulated. 

Final Thoughts

Ripple and Bitcoin are both good cryptocurrency investment options. They have different strengths that make them attractive to different types of investors, and they also offer a unique opportunity for diversification in your portfolio. 

With Bitcoin and Ripple being touted as the digital currency of tomorrow, deciding which one to invest in can be a daunting task. However, with some research into their respective pros and cons, you'll be able to make an informed decision that will hopefully lead to future success.

If you're still unsure which one is the best option for you, consider talking to a financial or investment expert who can help guide you through the decision process.

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