There are some significant differences between the top three cryptocurrencies, Bitcoin, Ethereum and Ripple/XRP. Though Bitcoin has been dominant since 2009, both Ethereum and Ripple have adapted to the environment very well and continued to surge ahead. All three of them are very distinct in how they operate, the maximum supply they have, what’s used to mine them and their overall value in the market.
The impact of XRP on the cryptocurrency market
At the time of writing, a single XRP equals US$ 0.458956. Its market cap is over US$ 18,000,000,000. XRP has experienced a rise in prices at 42% and continued to rise even further. XRP currently acquires third place at CoinMarketCap’s Top 100 Cryptocurrencies By Market Capitalization while Bitcoin and Ethereum acquire the first and second place respectively.
Compared to XRP, both Bitcoin and Ethereum experienced a lower rise in prices with Bitcoin price rising only 2% and Ethereum price rising by 7%. Despite that, their values and market caps are significantly higher than XRP. At the time of writing, Bitcoin equalled over US$ 6,500 with a market cap of over US$ 113,000,000,000 while Ethereum equals US$ 224 with a market cap of over US$ 22,000,000,000.
How is XRP or Ripple different from Bitcoin and Ethereum?
Apart from the value and market cap, there are many other differences between XRP, Bitcoin, and Ethereum. First of all, Bitcoin was created to remove any control from the governments or financial institutions by launching a decentralised digital currency. Bitcoin uses the blockchain technology which has grown in popularity significantly since its release in 2009.
On top of that, the Bitcoin’s peer-to-peer network was created to remove any financial institution’s involvement with the payment process. Bitcoin uses the proof-of-work SHA256 algorithm and miners usually mine them using ASICs. The maximum supply of Bitcoin is limited to only 21 million. Bitcoin usually takes about 10 minutes to transact and are charged with around US$ 40 of transaction fees.
According to FXempire, “Ethereum was created to resolve one of the main issues of the Internet, the vulnerability of user information to hackers in what has, essentially, evolved into a centralised warehouse of personal data. Its purpose was to compete against web-based companies that house data“.
Ethereum is most famous for its utilisation of smart contracts. A blockchain backs Ethereum, but its usage is slightly different from bitcoin. Ethereum uses smart contracts which write the code into the blockchain. The deal will be executed only when the concerned parties consent to the terms of the contract.
Ether can’t use ASICs for mining, and so miners use the GPUs in the graphics cards to mine it. The transaction fees and time are much lower compared to Bitcoin, at around US$ 1.13 and 14 seconds respectively. There is no maximum supply limit to Ethereum, unlike Bitcoin. Also, Ethereum uses the proof-of-work Ethash algorithm and are planning on transitioning to the proof-of-stake system.
XRP, on the other hand, is slightly different from these two. Ripple was created to eliminate the current issue of financial institutions having to charge high transaction cost and time. An international payment via bank transfer via bank transfer may take days and while charging you with high transaction fees. XRP has a lower transaction time and fees than both Bitcoin and Ethereum. The transaction fees of XRP is around US$ 0.004 and the average transaction time is around 14 seconds.
Ripple uses the Ripple Protocol Consensus algorithm instead of the proof-of-work system that Bitcoin and Ethereum uses. Another significant difference is that XRP can’t be mined at all. There is no particular method of mining XRP as every XRP tokens are pre-mined.
XRP does have a maximum supply limit like bitcoin. It’s 100,000,000,000 XRP while the total supply is 99,991,841,593 XRP.
In conclusion, XRP provides another excellent altcoin option for people to invest. XRP offers faster transaction time and a much lower transaction fee compared to Bitcoin and Ethereum. XRP offers excellent potential, and there have been speculations as to XRP overtaking Ethereum in the distant future. Only time will tell what XRP will be truly capable of, but it’s worth looking into.