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The role that XRP token plays in Ripple products

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Lots of critiques have been surrounding the current valuation of the Ripple token, XRP, lately. Regarding this, experts have concluded the coin actually has not managed to get enough traction on the market as to guarantee its current value. Accordingly, they assure this traction more likely can assume the form of its current valuation whether as a mediator for banks transactions or as an asset on the platform Ripple owns.

Indeed, the XRP token plays a very important role in the ecosystem of the company; it has become crucial for the value Ripple is setting on the market currently. However, right in the middle of the general uproar, there remains the question that what’s the exact utility XRP has on the product catalog Ripple owns.

Below, I’ll give you a short explanation of XRP’s role:

What is exactly the role that the XRP token plays on the Ripple Ecosystem?

In the current financial landscape, cross-border operations happen among isolated systems — which are not connected in between. To solve this fact, Ripple adopts the inter-ledger protocol that serves as a linker between systems and enables payment routings through making an interconnection possible between ledgers.

To understand it better, you can compare it to the concept of TCP/IP; the protocol behind a computer’s capability of talking one to another — basically, it just underpins the web (internet) systems and allows this to be a reality.

Like this, the ledgers constituting Ripple’s protocol can get attached to the networks of several financial institutions or even can serve as reliable nodes in networks approaching more than one entity at once. The technology of this protocol is built to perform faster cross-border transactions on regular financial systems.

Nevertheless, not all of the ground is gained by Ripple. As much efficient their tech may be, the issue of predefining fiat currencies in the accounts for foreign exchange operations remains unsolved. These accounts are known as Vostro and Nostro, and intermediate financial parties manage them to guarantee liquidity for their operations with foreign currencies.

The moment XRP comes to action

All of the products developed by Ripple use XRP for guaranteeing a swift liquidity. xRapid, one of the products Ripple has created, makes use of the token as an asset for financial institutions and businesses to use in order to make transactions between unique fiat currencies possible.

Like this, financial entities are able to purchase a determined amount of the token, and then send it out using the network of the company. In this matter, Ripple defines this process as a “Third-Party Liquidity Provisioning” — and asseverates that it’s actually perfect for bank units that are not connected somehow one to the other.

Subsequently, this isn’t a rocket science. In fact, that is the exact role the USD has been playing for several years in the financial market when an operation is going to be made, let’s say, between two not-so-common currencies.

The benefits of XRP can actually be enjoyed with the other products of the company too, including xVia and xCurrent. However, according to Stefan Thomas, CTO of the company, XRP is faster and more accessible at the fractions of only pennies — it takes just 3 seconds for a transaction when compared to other virtual coins on the market. The same way, XRP also offers other benefits such as sourcing banks liquidity on demand, in real time, and that without any need to have prefund nostro accounts.

Nevertheless, as like any other thing on the planet, not everything about Ripple is positive – XRP possesses s pretty robust technology, but there still is room for improvement (especially when we talk about the starters). For instance, the bridge asset status of XRP results in a dependency from financial institutions to Ripple in order to provide liquidity in operations.

We will be updating our subscribers as soon as we know more. For the latest on XRP, sign up for our Telegram!

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

Image courtesy of David Yu via Flickr

Bitcoin

Investors Beware: Another Large Bitcoin Crash Might Be Coming

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The crypto prices have surged quite high in the last few months. Of course, their progress is nowhere near the one seen in 2017, but they appear to be getting there, one day at the time. However, things might not be as simple as that, and according to recent performance — it is more than possible that a major Bitcoin crash is incoming.

The fact is that cryptos saw a massive amount of growth in a very short period. Bitcoin itself more than doubled its price in only two months. Now, the rally is starting to crash in on itself, and the coin is already about $1,000 lower than last week. If such development does come to pass, a lot of people will experience quite large losses, although experienced investors might find some opportunities, and leverage in order to enhance their holdings’ long-term value.

For example, Bitcoin dominance is expected to crash very quickly, which will work in favor of quite a lot of altcoins. While this does not seem to be the best time to invest in BTC, altcoins are another story, and diversifying a portfolio now might end up being very profitable in days to come.

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Altcoins

Top 3 Coins to Buy Before They Go Big

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Crypto bulls are back, that much is clear. The long-lasting, harsh crypto winter is gone, and the new era in digital currency sector opens up some rather interesting opportunities. With many more bull runs expected to come in months ahead, a lot of coins are likely to blow up and maybe even hit new all-time highs, although that still remains purely theoretical.

On the other hand, the fact is that numerous coins are seeing prices that were not achieved since early 2018, and the overall momentum remains bullish. With that in mind, even if new records do not come for a very long time — chances are that many of the coins will blow up enough for investors to see some serious gains in months to come. As a result, investing in some of these coins now might be a very profitable decision, for those who have the patience to wait a few months. Here are some of the projects believed to have the greatest potential to go big in the second half of 2019 and beyond.

1. TRON (TRX)

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Blogs

Can Crypto Credit Cards Disrupt the Fight Against Financial Crime?

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It is commonly known that the world of finances has the biggest problem with the crime of all existing industries around the world. It has been so throughout history. While the financial world has evolved, so did the criminal activities, and they continue to be an issue. With the arrival of cryptocurrencies, many were hoping that financial crime might be disrupted. However, for now, at least, it appears that cryptos themselves cannot find a way to resolve issues such as international money laundering.

In fact, when it comes to money laundering, the crypto sector appears to be the weakest link, especially because of the nature of digital currencies. The anonymity that cryptos are being praised for means that anyone can get a payment from an unknown source from anywhere in the world. This method can then be used for financing drug trafficking, cyberattacks, terrorists, and more.

Until recently, it was not easy for bad actors to make use of cryptocurrencies obtained for illegal purposes. The number of merchants willing to accept the coins was low, and criminals were forced to find a way to exchange crypto into fiat currencies. However, this came with a set of issues, such as taking foreign exchange risks and then sending the money through wallets and exchanges to a banking system that would allow withdrawal. The banking account was the biggest obstacle here,…

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