Ripple vs Bitcoin – Main Features of These Two Cryptocurrencies
Investors tend to make the comparison – Ripple vs Bitcoin. This is certainly necessary to understand why an asset is better than another in some fields. Moreover, it is also good to know the main benefits of each of them. While Bitcoin is the oldest and first virtual currency, Ripple was created to improve the financial market.
Both Bitcoin and Ripple have attracted a large number of investors. However, they don’t work in the same way. Indeed, they have a few differences that would make each of them special.
Ripple vs Bitcoin – Differences
Ripple is one of the most respected companies in the cryptocurrency market. This firm is working in order to offer solutions to financial companies and organizations. The main goal behind it is to help these institutions to perform fast and cheap transactions.
It is currently very costly and difficult for firms to send and receive transfers across borders. This is especially harmful to individuals who send remittances back to their families. There are several fiat corridors that do not have enough liquidity, and there is where XRP helps. XRP, as the currency used by Ripple, can reduce costs and transfer times.
Bitcoin, instead, is known for being the first cryptocurrency. It was created by Satoshi Nakamoto back in 2008, and it has been in the market since then. Nowadays, it is the easiest cryptocurrency to buy. Moreover, many individuals and people outside the crypto market know about it and consider it as a store of value or a medium of exchange.
However, new digital assets have been created, which work in a much more efficient way. When Satoshi Nakamoto created Bitcoin, the main goal was to reduce the power of centralized financial companies. Thanks to his invention, the crypto market today offers a great variety of digital assets.
As we have already mentioned in previous articles, Ripple works with its own consensus algorithm. This allows the virtual currency to be one of the fastest and efficient cryptos in the space. With the Ripple Protocol consensus algorithm (RPCA), XRP becomes decentralized and acquires speed. It is worth mentioning that this is a unique protocol in the market, as no other virtual currency uses it.
Bitcoin works with a Proof-of-Work (PoW) consensus algorithm. This PoW algorithm tends to be very energy-consuming. Indeed, miners have to acquire large and expensive hardware so as to process transactions. Of course, this keeps the network very secure, and it is almost impossible to break it.
Another problem with the PoW consensus algorithm is the fact that it can become very centralized. The majority of Bitcoin miners (almost 70%) are located in China, while Ripple nodes and servers are distributed all over the world, and no one could shut them down.
Besides all this, the PoW network makes transactions slow and sometimes expensive. Over time, Bitcoin will experience severe scaling issues, as it already had in the past.
Ripple vs Bitcoin – Price Comparison
These two virtual currencies have an important difference, and it is related to the number of coins available. Although there will be only 21 million BTC in history, there are 100 billion XRP that were minted. Most of these XRP coins are owned by Ripple and are used to support its operations worldwide.
Due to the way in which these two coins are distributed, this would be reflected in their price and valuation. Ripple has a market cap of $11,342,106,625, while Bitcoin has a market cap of about $208,465,462,965. In addition to it, Bitcoin has a price of $11,259.43, and XRP can be purchased for $0.251140.
Bitcoin’s highest price was reached at the end of 2017. In December, each BTC could be acquired for a price of $20,000, the highest price ever reached. Meanwhile, XRP hit an all-time high in January. At that time, users could have access to XRP for $3.84.
Acquiring and Storing Ripple and Bitcoin
It should be quite easy and simple to buy and store both Ripple and Bitcoin. If you have checked our previous articles, you will know how to do so in a fast and easy way. Considering we are talking about the first and the fourth-largest virtual currencies, it will be easy to acquire them.
Although these are safe platforms, the best thing to do is to send the funds to a hardware wallet. Exchanges have been hacked several times in the past. If this happens, it may be very difficult for users to get their funds back.
If you want to know which is the best Ripple wallet, you can check our full guide. This would help you understand how to protect your funds.
Future of Ripple vs Bitcoin
The future of Ripple vs Bitcoin seems to be bright for both. Indeed, each of these virtual currencies has great plans for the years to come. Ripple, for example, is working on a daily basis to expand its offering to other companies. This would also help increase the demand for the XRP virtual currency.
These partnerships are going to be very important for Ripple and the entire crypto market. Users will be able to process fast and cheap transactions across borders. Additionally, there are several developers working on top of the XRP ledger. This is also expected to increase the number of users of Ripple and the XRP digital asset.
Bitcoin enthusiasts will also enjoy a wide range of developments on the network. Indeed, developers are currently working on the Lightning Network (LN) and how to improve Bitcoin’s scalability. If it becomes possible for Bitcoin to deal with its scaling issues it will attract a large number of new users.
At the same time, it may be possible for this virtual currency to receive new privacy features to protect individuals. Litecoin (LTC), for example, is testing privacy solutions for its blockchain.
These two cryptocurrencies are leaders in the virtual currency industry. They offer solutions to users all over the world. While Ripple is expanding with new partnerships, Bitcoin developers are working on new solutions and improvements to enhance the whole BTC blockchain network.