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 Ripple has risen more than 495-fold in the past 12 months  Ripple is the world’s first open payment network Through this payment network, you can transfer any currency, including US dollars, euros, RMB, Japanese yen or Bitcoin. It is simple, easy and fast. Transaction confirmation is completed within a few seconds. The transaction fee is almost zero. There are no so-called inter-bank, long-distance and cross-border payment fees. Currently, Ripple, the developer of Ripple, is working with a number of financial institutions, including American Express and Santander, to conduct payment experiments. In 2016, Ripple announced that it had reached an agreement with Japan's SBI Holdings to establish SBI Ripple Asia, a Japanese financial services company, and began to deploy the Asian market. In December last year, SBI Holdings and SBI Ripple Asia announced an alliance with some Japanese credit card companies to utilize blockchain technology. Before chasing Ripple, you need to understand that it is not the same as Bitcoin  It took less than a month for Ripple to go from being unknown to being in the spotlight. Coinmarketcap shows that at 23:22 on January 4, Beijing time, Ripple (XRP) rose to US$3.67, an increase of approximately 28% in 24 hours, with a market value of nearly US$142 billion, firmly occupying the second largest market value of digital currencies. Its founder also became the world's richest man at a rocket-like speed. On the evening of January 4, Ripple co-founder Chris Larsen’s personal wealth, which holds 5.19 billion Ripple coins, was estimated to exceed US$57 billion, ranking him in the top ten of Forbes’ richest list. However, before chasing the rise, international investor Simon Black reminded on his blog website Sovereign Man: Investors first need to know the following points. Ripple is an inter-bank payment instrument Although Bitcoin and most cryptocurrencies are designed as a medium of exchange, Ripple is an institutional cross-border settlement asset designed to optimize bank liquidity and solve the huge challenges plaguing international bank payments. What’s more, Ripple (XRP) is just one part of the Ripple network. The Ripple technology platform, including the Interledger Protocol (ILP), can connect different payment networks together to achieve real-time transfers and significantly reduce the cost of financial transfers. You can understand the difference between Bitcoin and Ripple by comparing the length of time. Settlement time: Bitcoin may take 1 hour, or several hours if the network is congested; Ripple in just 4 seconds 。 Scalability: Bitcoin handles about 5 to 10 transactions per second; Ripple is capable of 200x and aims to handle more than 40,000 transactions per second, putting the technology on par with Visa and Mastercard.  When the news about Ripple’s surge was overwhelming, it was also when speculators poured in crazily. However, Simon Black believes that today’s Ripple currency is like Bitcoin last year, conforming to the “reflection phenomenon”: that is, the price rises – attracting more people to buy – supply exceeds demand and pushes up the price – and so on. But this phenomenon is also dangerous. Once the price drops, it will collapse quickly. He believes that Ripple is a tool for payment institutions like Western Union and is not designed for speculation by small investors. Therefore, he advises, please remain rational. “Coinbase Effect”? As the price of XRP skyrockets, rumors are swirling that Coinbase will soon accept XRP transactions. Coinbase is one of the largest Bitcoin exchanges in the world, with more than 10 million users. If the platform accepts XRP transactions, it will likely push the price of XRP even higher. But now it seems that this "good news" has not arrived so soon. On January 4, Coinbase issued a statement on Twitter, stating that it currently has no plans to add new assets to GDAX or Coinbase.  After the news was announced, the price of Ripple dropped sharply. According to the CoinmarketCap platform, the current price of Ripple has dropped to $3.25, with the price change within 24 hours falling by 6.49%.  We still underestimate the value of Ripple
Take a look at the picture below  The second-largest digital currency by market value trades at only one ten thousandth of Bitcoin A digital currency that has been dormant for the past six months has become the biggest dark horse this year. Ripple set a new record, and its market value once exceeded that of the second-ranked Ethereum. Even its highest trading price was less than one percent of Ethereum and almost one ten thousandth of Bitcoin.   Business Insider, a financial technology website, mentioned that Ripple has risen by about 61% in the past week and has risen by about 5,000% this year. Coinmarketcap shows that at the beginning of this year, the trading price of Ripple was only about US$0.006. On the evening of the 29th, Beijing time, it rose to US$1.85, which was about 308 times the level at the beginning of the year. As of the update, the trading price has exceeded US$2.0. Even calculated at $2, the trading prices of Ripple and Ethereum are very different. Ethereum was about $758 on the 29th. As of the update, it fell to about $747, and Bitcoin was trading at about $14,580.  Screenshots of Ripple’s market capitalization, market price and trading volume this year from Coinmarketcap Why is Ripple rising so sharply? "Forbes" reported that this is due to the strong interest of Asian investors. The report quoted Moscow digital currency and blockchain investment fund manager Alexey Ivanov, CEO of Polynom Crypto Capital, as commenting:“ Asians are going crazy for Ripple. ” Coinmarketcap data shows that as of publication, the Ripple trading volume of the three major Korean digital currency trading platforms, Bithumb, Coinone and Korbit, accounted for 30.27%, 7.25% and 4.27% of their global trading volume respectively. SBI Holdings, a financial services company in Tokyo, Japan, announced that the company and its subsidiary SBI Ripple Asia have formed an alliance using blockchain technology with some Japanese credit card companies. SBI Ripple Asia is a company jointly established by Ripple, the developer of Ripple currency, and SBI Holdings in June last year. CNBC believes that it is still unclear to what extent Ripple is involved in this new alliance, but the above-mentioned news of SBI’s cooperation with Japanese credit card companies is enough to promote the rise of Ripple. The reasons behind Ripple’s surge: Ripple’s steady development path Ripple Corporation is the creator of the Ripple Consensus Ledger (RCL) To discuss why the price of XRP has skyrocketed, we can first trace it back to an email at the end of 2016: On December 30, Ripple announced in an email: “It’s time for everyone to see XRP. ”It should be noted that the company introduced a new XRP quarterly market operations report at the end of the email. Ripple: “In order to continue to ensure the healthy operation of the global XRP market, we announced that we will launch a new XRP quarterly market operations report. ”  Therefore, from January 2017, Ripple began to release XRP sales target reports for the next quarter, a report on XRP's current sales performance compared to the previous quarter's target, an evaluation of the price trend of the previous quarter, and some notifications about new third-party wallets, exchanges, verifiers and market traders. The room for growth of this digital currency is noteworthy. On January 10, BitStamp, one of the world’s largest Bitcoin and digital asset trading platforms, announced that it would list XRP trading by next week. Bitstamp has taken advantage of XRP’s stimulus program by making XRP trading fees on the exchange zero for a period of time. Miguel Vias, Ripple’s XRP market director, said, “The company has been working hard to bring XRP closer to the standards of trading institutions and promote XRP global transactions, and this has also been confirmed by its connection with Bitstamp and the launch of the XRP stimulus plan. The circulation capacity of XRP is particularly unique. It can support exchanges to conduct large-scale global remittances, especially to some unknown small countries. Ripple's cooperation with banks makes XRP a good global liquidation asset, and for Bitstamp, XRP has higher liquidity and is more valuable to some financial institutions and individual investors. Nejc Kodrič, CEO of Bitstamp, commented: “After evaluating the inclusiveness of various cryptocurrencies, we quickly discovered that customer demand for XRP is particularly strong. Not only that, but Ripple and XRP happen to be fortunate enough to be compliant with Europe's digital currency regulatory framework, so we're happy to serve customers who need XRP. ” Not only that, Ripple also conducted cross-border payment tests with R3 (aiming to reduce settlement costs by 60% and further stimulate attempts to integrate new technologies into the financial system), which allowed Ripple to maintain a good development momentum in 2017. Ripple also received $55 million in Series B funding last September. Although some analysts say that investors from the Bitcoin community who switch to other altcoins are like the pattering of spring rain, seeping into the soil of XRP little by little, nourishing its growth. In the second half of 2016, financial innovation alliance R3 made headlines when it announced a cross-border payment trial with Ripple, and the seeds of XRP were also planted at that time. The trial was announced not long after Ripple announced it had raised $55 million in Series B funding. Later, Ripple announced several new features - Ripple Consensus Ledger (RCL), Interconnected Ledger Protocol (ILP), Escrow and payment channels. These functions effectively strengthen its expansion in the trading platform. Ripple announced that its network transaction throughput can compete with Visa. Japan's largest hedge fund bank Norinski Bank has joined SBI Ripple Asia's alliance (which was established in November 2016 and is known as the "Japanese Bank Alliance Providing Domestic and Cross-Border Payments"), which now has 50 bank members.  “Ripple has been working hard to change the status quo of real-time remittance clearing between banks, making remittances cheaper, faster and less risky. But it is unprecedented for a country like Japan to receive support from 47 banks. We are using distributed ledger technology, and although there has been a lot of hype about blockchain technology recently, Ripple is further ahead than anyone else in this area. We have developed some technical results that are suitable for enterprise applications, and these results have been recognized by many major banks in the world. ” A Ripple representative noted that “a lot of banks have chosen” Ripple. “The company's positioning is to provide banks with better technology and improve inter-bank transaction service levels. Ripple will not directly contact customers. We only provide a platform through which banks can clear inter-bank accounts in real time. This is an innovative technology, not a disruptive one. ” Ripple: We only promote and operate real and valuable virtual currencies Ripple is the base currency of the Ripple network. It can be circulated throughout the Ripple network. The total number is 100 billion and gradually decreases with the increase in transactions. The operating company of Ripple is RippleLabs (its predecessor is OpenCoin) Ripple is the world’s first open payment network Through this payment network, you can transfer any currency, including US dollars, euros, RMB, Japanese yen or Bitcoin. It is simple, easy and fast. Transaction confirmation is completed within a few seconds. The transaction fee is almost zero. There are no so-called inter-bank, long-distance and cross-border payment fees. Ripple is an open source peer-to-peer payment network that allows you to easily, cheaply and securely transfer your money to anyone on the Internet, no matter where he is in the world. Because Ripple is a p2p software and is not controlled by any individual, company, or government, anyone can create a Ripple account. The ripple payment network delivers credit, called Ripple Credits, also known as XRP, and some people call it Renpin Coin. Ripple issued a total of 100 billion XRP. XRP is currently accurate to 6 decimal places. The smallest unit is called a drop. 1,000,000 drops equals 1 XRP, 1XRP=1,000,000dXRP. Ripple’s origin: its origin is much earlier than Bitcoin The reason why Ripple has become a focus after Bitcoin is because several well-known venture capital institutions, including Andreessen Horowitz, announced their participation in investing in OpenCoin on April 10, 2013. Ripple is a p2p network payment system developed, operated, and maintained by OpenCoin. Perhaps in the eyes of outsiders, Ripple is a latecomer, but in fact the origin of the Ripple project is much earlier than Bitcoin. In 2004, Ryan Fugger launched the first implementation of Ripple. Its goal is to build a decentralized virtual currency system that allows anyone to create their own currency. Money in the Ripple network is represented by "debt", and all transactions are expressed as changes in account balances. It works like a bank's clearing system: when making inter-bank transfers, the actual transfer of funds between banks is delayed as much as possible into the night, when the bank calculates its dues with other banks. It is possible that the amount to be transferred in from a certain bank exactly offsets the amount to be transferred out to the bank, so that it does not actually need to transfer any money out or in; even if it cannot completely offset, the actual amount transferred will generally be much smaller than the sum of the customer's wire transfer amount. The original intention of the Ripple project is to build a distributed P2P clearing network Everyone is their own bank, which can issue and accept loans, and at the same time serves as a lending channel (for example, A wants to borrow money from B, and they do not know each other, but they all know C, then C can serve as a channel for A and B. C first borrows money from B, and then lends money to A, indirectly allowing A to borrow money from B). The project was supported almost by Ryan Fugger alone and achieved a certain degree of success. However, Ripple has never had many users and is only popular in a few isolated small circles. The reason is very simple: Ripple's design idea is based on acquaintance relationships and trust chains. If a person wants to use the Ripple network to transfer money or borrow money, the premise is that his friends already exist in the network, otherwise a trust chain cannot be established between the user and other users. This situation has changed with the establishment of OpenCoin. The two founders of the company: Chris Larsen and Jed McCaleb are not ordinary people. The former has been working in the field of online finance for more than ten years and is the founder of the famous Internet bank E-Loan and the p2p credit company Prosper. The latter is the developer of the largest Bitcoin trading platform Mt. Gox (and also the developer of the famous P2P network eDonkey). Main features The joining of powerful people in the industry has brought huge changes to the Ripple project. The new version of Ripple introduces two measures to solve the problem of isolated small circles: one is to launch the Ripple coin-XRP, which serves as the base currency of the Ripple network. Like Bitcoin, it can be circulated throughout the network without being limited to a circle of acquaintances; the other is to introduce the Gateway system It is similar to a currency exchange institution, allowing people to inject and withdraw legal currency into the Ripple network, and can act as a bridge between borrowers and lenders. One of the main features of Ripple is decentralization. It needs to maintain a general ledger containing all accounts and all transactions (and therefore all account balances). This general ledger is distributed among all network nodes and remains synchronized at all times. Its core mechanism is similar to Bitcoin, but there are also the following important differences: 1) The Ripple network supports multiple currencies. In addition to its own Ripple coin, it also supports fiat currencies (such as US dollars, euros, Japanese yen, etc.) and intends to support Bitcoin around April 19, 2013, and may support all virtual currencies in the future. 2) The Ripple network automatically performs exchange rate conversion. In other words, users can use any type of currency to pay others any type of currency, thereby realizing the circulation of all currencies across the entire network. 3) Ripple’s transaction confirmation process can be completed within seconds. Ripple has introduced a "Consensus" mechanism, which enables transactions to be verified and confirmed in a very short time through the voting of special nodes. 4) The Ripple client does not need to download the blockchain. It discards the verified ledger chain on ordinary nodes and only retains the most recent verified ledger and a link to the historical ledger. Therefore, the workload of synchronizing and downloading the ledger is very small. Ripple does not need and cannot mine 6) The total amount of Ripple coins cannot be increased, and can only decrease. The company has created 100 billion units of Ripple coins, plans to eventually issue 75% of the Ripple currency supply, and promises never to issue more. Users have to spend a certain amount of Ripple coins for each transaction (the amount is very, very low, about 1/1000 of a cent). This transaction fee is not paid to anyone, but just disappears into thin air. Therefore, there will only be fewer and fewer Ripple coins, but the rate of decrease is very slow. Comparing Bitcoin, we can find that the functions of the Ripple network far exceed Bitcoin, including: 1) Two-way circulation of real and virtual currencies; 2) Multi-currency P2P exchange and payment; 3)P2P network credit; 4) Personal network liquidation. The combination of these four functions has formed a basically complete, decentralized, all-currency financial system. Such ambitious ambitions should come from the company’s leadership’s rich experience and radical planning in the financial and technology industries. Under this ambitious plan, the future network financial system is already emerging, which may be one of the main reasons why venture capital institutions embrace OpenCoin. Another main reason is believed to be the coveting of 25 billion Ripple coins - OpenCoin will retain 25% of Ripple coins in order to regulate the Ripple network. Ripple is a new global payment system Ripple can break the so-called rationality and expensive fees of traditional payment systems. Obviously, in order to compete with the payment giants, a company must build its own global payment system and establish partnerships with hundreds of banks, as well as deal with foreign exchange risks and set up agents everywhere. In contrast, Ripple has established a shared, free payment network that can be used anywhere in the world at any time. Due to the existence of Ripple, people do not need to get involved in the foreign exchange market when conducting global transactions, because Ripple's internal mechanism already supports foreign exchange exchange. Similarly, people do not need a multinational financial institution to complete financial payments. You only need a simple payment entrance to complete everything. Digital currencies collectively plunged, but Ripple bucked the trend and rose In 2017, the Bitcoin market almost reached crazy levels. However, for Bitcoin right now, as crazy as the past rises have been, so violent has the recent correction been. The decline of Bitcoin also led to the overall decline of digital currencies, with a decline of more than 10%. In fact, except for Ripple, which maintained its upward trend today, all other digital currencies could not escape the fate of falling. Stephen Innes, head of Asia-Pacific trading at Oanda Corp, said, “The core reason why such a market is happening is the enthusiasm for virtual currencies with limited supply, which has led to immature investors still buying these currencies at high prices. ”  Market data shows that Bitcoin has suffered a waterfall-like decline in recent days, and the intraday decline has expanded significantly. Quotes from multiple Bitcoin trading platforms show that Bitcoin has fallen below US$14,000 per coin, with an intraday drop of nearly 20%. According to the news, the latest tax reform plan of the US Republican Party will cause investors in Bitcoin and other virtual currencies to lose a tax benefit. At the same time, many early Bitcoin investors have recently spoken out to remind investors that Bitcoin transactions are extremely risky.  In addition to the decline of Bitcoin itself, Bitcoin Cash (Bitcoin Cash), which was hard forked on August 1, has also fallen back below $3,000 after continuing to rise in recent days. The current quotation on the Bitstamp platform is $2,773. In fact, with the exception of Ripple, almost all virtual currencies fell during the day. So why is Ripple the only currency that can buck the trend?  For banks, the real appeal of Ripple is its liquidity and ease of trading. Ripple Labs CEO Brad Garlinghouse told Fortune magazine earlier this year: “The liquidity needs of banks today are coming from those interbank accounts, and their capital flows are in the real tens of trillions. We firmly believe this is an inefficient model. You can use digital assets to provide liquidity, and Ripple is uniquely positioned to do this. It takes four hours for a Bitcoin transaction to complete. Ripple takes just 3.6 seconds. ” In addition, the unit price of Ripple is relatively low, only about US$1, which is also a major reason to attract investors to buy. Ripple’s rise appears to be a cascading effect of the huge attention Bitcoin has attracted. Investors who believe cryptocurrencies may be about to peak are looking for other investments where long-term returns may be higher. It’s just that Ripple has also achieved several milestones in recent months. As of October, Reborn has licensed its blockchain technology to more than 100 banks. American Express becomes an authorized member. Meanwhile, Michael Arrington’s $100 million cryptocurrency hedge fund will have its value measured in XRP. According to BBG, Ripple, which uses a network of nodes including financial institutions to verify transactions, has maintained its gains, partly because the company said it has interest from financial institutions and partly because concerns about the cost of Bitcoin mining have intensified. BBG Industry Research believes that second-generation cryptocurrencies including Litecoin, Ethereum, and Ripple outperform Bitcoin because they focus on being “faster and cheaper.” Ripple: Decentralization will surpass Bitcoin in a year and a half Ripple, a well-known financial technology (FinTech) payment company, has disclosed its development strategy and believes that its blockchain will eventually be more decentralized than Bitcoin.  Ripple’s technical chief has released three major strategies for its blockchain, the Ripple Consensus Ledger (RCL), aiming to build it into a more secure, efficient and decentralized blockchain than Bitcoin. Become a more decentralized blockchain than Bitcoin Our main goal is to become a more decentralized blockchain than Bitcoin Currently, 51% of the computing power in the Bitcoin blockchain is in the hands of only 5 mining pools. This means that the five largest mining pools can join forces to launch 51% attacks and rollback transactions (double spends) at will. In the Ethereum network, this number is even smaller: just three mining pools are needed to control the blockchain. Founded in 2012, RCL is an enterprise-level public chain, which is completely opposite to Bitcoin. RCL is aimed at banks and payment providers to process cross-border payments. RCL is also the core ledger of Ripple’s native digital asset XRP. Ripple has been criticized by the crypto community since its launch, with many accusing its network of being too centralized. From Ripple's perspective, the decentralization of its blockchain is a transition that has been underway since its inception. Thomas said: We don't want to rush this transition and we are making progress all the time. At present, achieving decentralization is the primary goal, and Ripple verifies the necessity of node diversification - which is conducive to creating a more robust and flexible blockchain. Ripple has convinced customers of most banks and payment providers around the world The first is Ripple’s first attempt at diversifying blockchain verification nodes. There are currently 25 verification nodes in RCL, and continuing to increase and diversify node operators is within our priority. This approach is ultimately to avoid the risk of a single node failure and to diversify nodes across multiple regions and software platforms. Secondly, Ripple will add tested validators to the network to monitor the new validators and check whether they operate in compliance with the "consensus protocol, uptime, and conduct identity verification and public certification." Finally, Ripple will add validators that pass the test to its special node lists (UNLs). UNL lists all transaction verification nodes "trusted" by Ripple. The company’s plan is to phase out nodes under its control and replace them with tested third-party validators, eventually reaching the point where no single operator in the blockchain controls a majority of trusted nodes. Over the next year and a half, as long as two third-party verification nodes pass the test and meet the above-mentioned standards, we will eliminate one of Ripple's verification nodes until eventually no single operator can control the majority of trusted nodes in RCL.  Bitcoin only selects validators based on mining power, which is actually detrimental to security To meet Bitcoin's standards, RCL only requires 16 trusted validators. The more validators are added, the more fault tolerance must be increased. In other words, RCL will not only meet the standards of Bitcoin, but also surpass the level of decentralization of other public chains. In addition, the Ripple executive also believes that Ripple even has the upper hand compared to Bitcoin in terms of blockchain consensus. Thomas said that it is impossible for Ripple’s validators to turn into malicious nodes or carry out attacks because they are selected “ethical” nodes. This is different from the Bitcoin validator, which selects nodes through PoW mining. Bitcoin only selects validators based on mining power, which is actually detrimental to security. Achieving security means spending money but not improving mining speed. Earlier this year, Ripple promised to achieve Visa’s transaction throughput. The world's largest payment network is currently able to complete 70,000 transactions in 3.7 seconds. The above content is compiled based on public information on the Internet.  Gaoronghui Capital Gaoronghui Capital was established in 2014, and GRH Blockchain and Digital Asset Hedge Fund was established in Hong Kong in December 2017. For more details, please contact chengang@grhcapital.cn   |
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