The contention between Ripple vs Bitcoin has created more division than a football match.
What is the difference between Bitcoin and Ripple that could cause such a stir within the crypto community?
Well, the reason lies in the fundamental difference between these two blockchain projects.
Both Ripple and Bitcoin use cryptography and are two of the top three largest cryptocurrencies by market cap.
However, that is where the similarites end.
They both differ greatly in ownership model, technological architecture, utility and token economics (tokenomics).
It is important thatcrypto investors and tradersknow the difference between Bitcoin and Ripple.
This article will go through the key differences between Bitcoin and Ripple.
We will first introduce Bitcoin and Ripple before getting into their contrasts.
What Is Bitcoin (BTC)?
With a market cap of 212.09 billion USD and a max supply of 21 million, we have Bitcoin.
The cryptocurrency with the largest market capacity in the market.
Bitcoin was created by an anonymous person or group called Satoshi Nakamoto.
Its white paper was published in October 2008.
The projects objective was to ensure decentralization and trust in transactions.
This was to be achieved through a peer to peer, proof of work system.
This system does not require participants to trust each other.
This way, Bitcoins blockchain algorithm serves as a substitute for trust.
POW is a peer to peer system.
These nodes gather up recent transactions and settle them in the form of a block of data.
This process is repeated as each block must look to the previous block to be validated.
This system meant that Bitcoin requires public support as there are no companies or institutes funding it.
These rights are given to miners as they contribute economically to the online grid.
This way, no single individual or organization can overcome the entire internet.
Integrity is thus preserved through computer codes rather than through human beings opting to do the right thing.
Lastly, the Bitcoin internet eliminates double spending.
This is because it time stamps the transaction when an individual spends a value of bitcoin.
And rejects subsequent spend of that bitcoin.
This traceability is supported by transparency as transactions on the blockchain are made public.
In short, Bitcoin allows for decentralized control, worldwide participation and codified integrity.
What Is Ripple (XRP)?
Now lets understand what the third largest cryptocurrency by market capacity has to offer.
In addition, it is a time-consuming process with the turnaround time reaching up to 5 days with SWIFT.
Using XRP on the Ripple online grid, funds can be sent, cleared and settled under 5 seconds.
Ripple Centralized Digital Currency
By now the difference between Bitcoin and Ripple should have become more apparent.
Ripple is built with a specific clientele in mind and takes on a centralized approach to blockchain.
It is designed to improve the existing financial infrastructure instead of creating fundamental change.
This goes against Bitcoins ethos of decentralization and taking back control from centralized institutions.
However, is decentralization the best path towards a globalized economy?
After the 2008 financial crisis, there was an apparent flaw with traditional banking and financial systems.
No single entity governs the online grid and participation is available to all.
Ripple is different from Bitcoin as it is highly centralized and owned by the company Ripple.
The participants are selective and are elected.
While the internet itself can function autonomously, the company cannot.
This would mean that Ripples management and authorities can easily influence the way the Ripple internet operates.
Technology
The decentralized nature of the Bitcoin connection allows for its code to be open sourced.
Other blockchain projects can be developed from its concept.
If you are active in the cryptocurrency community, you might have heard of forks.
Forks are essentially changes in the software of a digital currency that shares the same history.
These forks happen as different development teams with different visions split the online grid into two different versions.
The rise ofBitcoin Cashis one famous example of a fork.
Holders of Bitcoin on a supported wallet would have received Bitcoin Cash (BCH) as a result.
Another major system difference between Bitcoin and Ripple is transaction speed.
This is due to the Bitcoin networks Proof of work system that takes time for block confirmations.
This coupled with its limited supply creates scarcity.
; Xcurrent, Xrapid and Xvia.
Firstly, Xcurrent is used by web link members to process payments more efficiently and with greater certainty.
Secondly, Xrapid is used to source for liquidity through digital assets.
Bitcoins concept of a decentralized currency is revolutionary and would change the way finance is handled.
But realistically, banks are here to stay as it would be impossible to do away with banks overnight.
Tokenomics
The tokenomics of a cryptocurrency covers a vast area but today we will only focus on token supply.
With this information in mind, the debate between Ripple vs Bitcoin comes to a crescendo.
Bitcoin serves as a fair playing field where market forces decide.
No one can influence absolute control at the cost of wild price swings.
Ripple while providing efficiency and effectiveness as a currency is highly susceptible to human irrationality.
A single person can crash the Ripple price and the company can shut down the internet.
Final Thoughts On Ripple Vs. Bitcoin
In the battle between Bitcoin versus Ripple who would you pick?
Are you a trader and speculating on the future price of Ripple?
If you are looking for a safe store of value, then perhaps Bitcoin.
For a comparison between Ethereum and Bitcoin,read our guide here.
