Bitcoin is currently considered the leader of the cryptocurrencies, but there’s a new challenger on the horizon, and its name is Ripple. Ripple has been surging thanks to its varied applications and adaptability. Ripple is currently counted in the top 10 of all virtual currencies, ranked by market cap.
Bitcoin operates on a public ledger, containing a multitude of transaction data. This is the blockchain, designed to be resistant to the modification of data. On the other hand, Ripple is a technology system that has its own cryptocurrency, called the XRP. Ripple is mainly used in international transactions, much like the service SWIFT, which is used by multiple banks. Ripple operates on a poll-based system of authentication. Basically, by conduction of a poll, all the nodes on the network decide whether a transaction is valid.
This means that both Bitcoin and Ripple are decentralized, but Ripple is considered faster and more reliable.
A difference between the two is present in the number of each coin present. Bitcoin has a total of 21 million crypto coins while Ripple sits at a count of 100 billion coins.
The method of obtaining these coins is also vastly different for the two of them. Bitcoin can be obtained through the standard mining procedure, where a user can hook up to the network, and add multiple transactions, compiled into blocks, and add them to the blockchain. Ripple does not have this, but lacking the feature means that Ripple is a less energy-consuming system.
To understand how Ripple is different from Bitcoin in its application, let’s use an example. A man has to send one of his friends some cash. He sends the friend’s agent the transaction details and a password. If the friend is able to tell the agent the password, he gets the money. However, now the man owes his friend’s agent the money he gave the friend. This debt can be paid on a later date, or, some other person pays the agent through the original man, balancing out the debt.
This latter half is where it gets complicated, but Ripple is a lot like this.
With these differences, there exists a bottom line. Bitcoin is still the same, public system, not owned or influenced by any particular individual or company, while Ripple, though decentralized just like Bitcoin, operates under a company of the same name. Despite the difference in the coin system for each, both services have their own special uses and application. Each virtual currency caters to different usage.