Ripple vs. Bitcoin

Whether you are just starting to invest in cryptocurrency or you’ve already dipped your toes, you’ve more than likely heard of Ripple (XRP) and Bitcoin (BTC).

 

You’ve probably even stumbled across this page in the hopes of getting an understanding of what makes Ripple and Bitcoin different. Well, it so happens that comparing them is a great way to learn just how different two crypto assets can be.

 

Let’s take a deeper dive into the difference between Bitcoin and Ripple.

ripple vs bitcion
ripple

RIPPLE

Ripple presented a new way of operating a blockchain’s transaction and records system for payment settlements.

Bitcoin vs Ripple

BITCOIN

Bitcoin was created as a response to government monetary manipulation, and it seeks to serve as an alternative to traditional government currencies.

To further understand how these two complex networks work, read below for a side-by-side comparison of Ripple vs Bitcoin so you can start to better understand and appreciate the differences yourself.

The difference between Ripple and Bitcoin

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Ripple

Ripple was founded September 2012

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Bitcoin

The Bitcoin white paper was published on October 31, 2008 on the cryptography mailing list. The software later went live on January 9, 2009.

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Ripple

Originally founded as OpenCoin, the startup behind XRP later changed its name to Ripple Labs in 2013 before settling on Ripple in late 2015.

Ripple now acts as principal steward in the funding and development of XRP and plays a big role in its development and digital economy.

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Bitcoin

Bitcoin was created by a pseudonymous individual or group under the name Satoshi Nakamoto. To this day, Bitcoin’s creator remains unknown.

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Ripple

XRP

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Bitcoin

BTC (Note: You may see BTC appear as XBT on other platforms)

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Ripple

XRP was created to complement traditional payments by migrating transactions that occur today within financial institutions to a more open infrastructure.

 

In order for XRP to work, Ripple built the XRP ledger, a software that introduced a new way of operating a blockchain’s transaction and records system.

 

Similar to Bitcoin, the XRP ledger allows users to send and receive its XRP cryptocurrency using digital signatures.
 

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Bitcoin

Bitcoin is an open-source software that allows its global user base to manage a digital money supply outside the control of any government or central bank.

 

It was created in response to the 2008 global economic crisis as a means to combat inflation. In fact, the first mined block contained the message: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks,” a message many believe signifies the project’s revolutionary intent.

 

The Bitcoin software enables the computers running it to manage a ledger (the blockchain) that accounts for all transactions made using its currency (BTC) by enforcing a variety of rules.

 

The Bitcoin blockchain is a full record of the network’s transaction history validated by nodes, or individuals running its software. This ensures that each BTC cannot be copied or modified, and that bitcoins cannot be created or used in a way that is against its rules.

 

Bitcoins are scarce, divisible and transferable, making them a valuable alternative money.

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Ripple

Upon the launch of XRP, Ripple initially distributed 45 billion XRP to users on forums through various giveaways. The remaining XRP is being escrowed by the company to fund its technology development.

 

However, the distribution of its tokens continue to cause debate due to Ripple being a for-profit company. This has enabled it to be the principal steward and key decision maker in the funding and development of the XRP Ledger, a controversial stance in the distributed world of cryptocurrencies today.

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Bitcoin

Bitcoin’s white paper, titled “Bitcoin: A Peer-to-Peer Electronic Cash System” , was released by Satoshi Nakamoto in 2008.

 

The first 50 bitcoins were mined upon the release of the software, enabling a decentralized network of computers to run a digital economy that is still thriving today.

 

Satoshi famously left the project in 2011 and hasn’t been heard of since, though you can find out more about his (or her) attitudes toward the technology in various emails and forum posts.

 

Since then, hundreds of developers have contributed to improving Bitcoin’s code, whether it is routine bug fixes or great, efficiency driven, improvements.

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Ripple

Central to the XRP cryptocurrency is the XRP Ledger, the technology that allows users to send and receive cryptocurrency using public- and private-key cryptography and enables servers to send transactions for consideration by its network.

 

The XRP Ledger differs from Bitcoin in that it does not use mining or require specialized computing hardware to secure its ledger and validate transactions. Only specific nodes, called unique nodes, can validate transactions on the network.

 

This design was intended for nodes to quickly validate transactions in an attempt to mirror transactions that occur today between databases controlled by financial institutions.
 

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Bitcoin

Central to Bitcoin’s design is the ability for two users to send each other BTC from anywhere around the world, without the need for an intermediary.

 

In order to keep its network secure and decentralized, while regulating the supply of new money that gets released into its economy, Bitcoin uses a process called “mining”.

 

In this system, called Proof of Work (PoW), miners race to complete cryptographic puzzles to propose blocks that make up the Bitcoin blockchain.

 

When a block is discovered by a miner, it is announced to the network, and, when it’s verified by every node, the miner gets compensated in newly minted BTC. 

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Ripple

While the XRP Ledger does not require transaction fees in the way Bitcoin does to reward miners, it does mandate that a small amount of XRP be put up by the sender to be destroyed and deducted from the total supply.

 

Like Bitcoin, the supply of XRP is limited, meaning that according to the software’s rules there will only ever be 100 billion XRP.

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Bitcoin

One of the biggest value propositions of Bitcoin is its monetary policy – only 21 million BTC will ever be introduced into the network’s economy.

 

When the first block was mined in 2009, 50 BTC were released, a block reward that is cut in half roughly every four years. This event is known as the halving, or halvening.

 

Through this process, more than 18 million BTC have been made available as of 2020. The last bitcoin is projected to be mined in 2140.

Useful resources

If you are interested in learning more about Ripple and Bitcoin, please visit Kraken’s What is Ripple (XRP)? and What is Bitcoin (BTC)? pages.

 

Want more in depth information on specific cryptocurrencies and blockchain projects? If so, visit our Learn Center to further your education on this ever-growing space.