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Ripple: Pros, Cons, and How to Buy XRP in NZ?

Estimated reading: 5 mins

Ripple: Pros, Cons, and How to Buy XRP in NZ?

UPDATE: Ripple, the currency, is now known as XRP. The ticker remains the same (XRP). For more on this, see our post on the new XRP logo.

What is Ripple?

RippleNet, developed by Ripple, is a real-time decentralised gross settlement system used for currency conversion and remittance. The platform works as a global network, allowing anyone to transfer money in seconds.

Ultimately, RippleNet is a global network recording transactions between banks. Ripple uses its own XRP cryptocurrency as a payment method on the network. Ripple is designed to enhance the current banking and payment services, not replace them. It is the system banks will use to communicate with each other.


“We took a rather contrarian view at the time that we’re not anti-bank, we’re not anti-government, we’re not anti-fiat currency”. Brad Garlinghouse, CEO Ripple.


The Ripple technology outperforms the current financial infrastructure by increasing processing speeds, cutting transaction fees, and providing visibility via distributed ledgers.

So far, Ripple has over 100 banks and financial institutions using its blockchain technology software.


“In 2017, people have realized there isn’t going to be one crypto to rule them all. You’re seeing vertical solutions where XRP is focused on payment problems, Ethereum is focused on smart contracts, and increasingly Bitcoin is a store of value. Those aren’t competitive. In fact, I want Bitcoin and Ethereum to be successful”. Brad Garlinghouse, CEO Ripple.

Ripple for Banks

Today, transaction banking customers need to send both high and low-value payments on demand. The current banking infrastructure means that banks process these payments in bulk batches. This batch-type payment results in lengthy processing times. Ripple developed three software applications to address these concerns.

  1. xCurrent

    Offers new cross-border payment services to banks. It integrates with existing compliance, security, and risk frameworks. xCurrent uses an Inter Ledger Protocol to connect all members and, as a result, provides real-time settlement. In addition, xCurrent provides transaction immutability and information redundancy.

  2. xRapid

    Designed for payment providers and financial institutions to minimize liquidity costs by lowering capital requirements. xRapid is powered by XRP, the only software developed by Ripple to do so thus far. Currently, confirmed participants of xRapid include MoneyGram, Western Union, Mercury FX, Cuallix, and IDT.

    Update (03/06/2018): InstaRem, BeeTech, Kuwait Finance House, and CoinOne have signed up for RippleNet.

  3. xVia

    xVia is for corporates, banks, and payment providers sending payments across networks using a standard interface. Furthermore, the simple API requires no installation and allows users to send payments with information, like invoices, attached.

XRP (Previously Ripple) Pros and Cons




Privacy Concerns

Cryptocurrencies, in general, are known for their privacy and anonymity. Finder raises an interesting point to keep in mind: “Ripple’s decision to market its platform exclusively to banks has been a cause of concern for some users who worry about big brother keeping an eye on their transactions”. Of course, this is speculation and shouldn’t pose a problem for the vast majority.


Ripple’s platform is considered more centralised than most cryptocurrencies due to Ripple Labs owning approximately 60% of the coins available. In a bid to address this potential issue, Ripple placed 55 billion XRP into an Escrow account. This move reassured XRP holders regarding the XRP supply at any given time and addressed the fear of the market flooding. Escrow secures the XRP for an allocated amount of time, in this case, one month. As such, 55 contracts contain 1 billion XRP each. On the first day of every month, a contract expires and “unlocks” the XRP for Ripple’s use.

Ripple Products

Out of the 100+ financial partnerships Ripple has, only five actually use the XRP cryptocurrency. The financial institutions using xRapid include those mentioned earlier in the article. The other institutions use another Ripple product called xCurrent.

Distributed Ledger

New York Law School professor Houman Shadab told American Banker in 2015 that distributed ledgers “have a more secure, distributed authentication process that doesn't rely on the incentives of miners who authenticate transactions based on the value of the currency". The Ripple network is useful in that it can track information of any kind. For example, Ripple can track the account balances of any existing currency.

Iterative consensus process

The consensus method used by Ripple enables more energy efficient and faster finalisation of transactions. The network receives transactions from different nodes (computers) and the consensus method works to validate them. This occurs in an iterative process: once 50% of the nodes approve the transactions they are then pushed for higher approval. Once the transactions reach what is called a “super majority” they become validated. Once validated the transactions are written to the ledger and broadcast to all other nodes. This entire process occurs in approximately four seconds!

White Paper

Ripple’s white paper is very thorough. The development team explain everything about the project from both a basic and an advanced perspective. The team describe their vision of where they want to go with the “internet of value” project. If you wish to learn more about the Ripple network check out the Whitepaper Database.

Market Cap

Currently, XRP is the third largest cryptocurrency by market capitalisation. At the time of writing the market cap is sitting at over NZD$49 billion. Market capitalisation is a tool to determine the value, or relative size, of a cryptocurrency traded on the market. It is calculated by multiplying the total number of coins in circulation by the current volume-weighted average of reported prices.

Ripple Team

Ripple’s leaders and developers combine decades of experience in the financial and technology sectors. Additionally, the team is backed by globally recognised venture capital firms and investors including Google Ventures, Seagate, and SBI Group.


The Future of Ripple

Ripple has been one of the most popular cryptocurrencies over the past few years and, as mentioned before, is the third largest by market capitalisation. Consequently, It seems likely that more users will be attracted to XRP because of the cheap transaction fees, and the secure and fast settlement.

For Ripple to outpace its competitors, it needs large financial institutes to buy its payment software and use XRP. The challenge for the company to overcome is to convince banks to change the way they’ve done business for years. “The biggest obstacle in convincing banks to use Ripple’s services is that many banks have other IT-related projects that are a greater priority to them than Ripple”, Garlinghouse said.


How do Ripple (XRP) Withdrawals Work?

Initially, to activate your wallet address on the network the first transaction sent must be at least 20XRP. This 20XRP is essentially “locked” to your account and works as a minimum base reserve requirement. For every transaction sent this 20XRP will remain so it is important to remember this when calculating your withdrawals. Ripple implemented this reserve to protect the ledger from excessive growth caused by malicious use.

To protect the XRP ledger from DDOS attacks and spam disruptions, each transaction destroys a tiny amount of XRP. This is comparable to a “transaction fee”. This fee is employed to discourage overloading the network by increasing in relation to the load on the network. The current minimum amount is 10 “drops”, or 0.00001 XRP. Ripple drops are destroyed meaning the scarcity of XRP rises very slightly with each transaction made. This, in turn, will work to make XRP more valuable and thus benefit all XRP holders.

How to Buy XRP in NZ?

To easily buy XRP in NZ you can do so right here, at BitPrime. The process is simple: First, you will need to set up a wallet. For more advice on which wallet to use with XRP (XRP) see our wallet recommendations. Next, if you haven’t already done so, please register an account with us and have your ID verified. Finally, visit our XRP page to order your XRP. If you require any further assistance, please contact us and we will be happy to help.

Disclaimer:  The above references an opinion and is for informational purposes only. The opinions expressed by the author do not represent the opinion of BitPrime.


Last updated: 02/07/2018


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