Below is an in-depth analysis (more than 2
In-depth analysis of XRP - The ‘payment protocol’ coin of Ripple Labs
XRP is the native token of the RippleNet digital payment system, developed by Ripple Labs. Unlike Bitcoin or Ethereum, which use Proof-of-Work or Proof-of-Stake mechanisms, XRP operates on the proprietary Consensus Protocol (Ripple Protocol Consensus Algorithm - RPCA). This allows transactions to be processed extremely quickly (in just 3-5 seconds) at almost no cost.
The main goal of Ripple and XRP is to replace traditional money transfer systems like SWIFT, which are deemed slow, costly, and lacking transparency. With a network of hundreds of partners including banks and global financial institutions, Ripple has made XRP a bridge liquidity tool between different currencies.
However, XRP is not without risks. The lawsuit with the SEC (U.S. Securities and Exchange Commission) that lasted from late 2020 to mid-2023 negatively impacted the price and reputation of XRP. Although Ripple achieved a significant legal victory (the SEC could not prove that XRP is a security when sold to individual investors), the lawsuit still left a notable legal mark.
Advantages of XRP:
Fast transaction speed (~3 seconds)
Extremely low fees
High scalability (1,500 TPS)
Practical applications in the traditional financial system
Disadvantages:
High centralization (most XRP is held by Ripple Labs)
Legal risks (although reduced)
Intense competition from new solutions like Stellar, USDC, and CBDC
