The rise of Bitcoin and other cryptocurrencies has led to an influx of new cryptocurrencies. However, very few of them come close to competing with Bitcoin and its market cap. The cryptocurrency known as Ripple on the other hand has gained the attention of many cryptocurrency investors and traders, causing it to rise in the charts of total market cap, it amongst the top 10 cryptocurrencies by market cap.
Ripple was founded in 2012 and is owned and operated by the San-Francisco based company, OpenCoin. Ripple was developed to improve upon global financial transactions by making them faster, more secure, and simplified. The Ripple company has a very strong marketing team and has developed important relationships with institutional financial institutions such as Santander, Bank of America, and UBS.
The Ripple cryptocurrency differs from other cryptocurrencies like Bitcoin, Litecoin, and Ethereum in the sense that it is not used as a currency, but rather as a technology used to facilitate global financial transactions of fiat currency. As well, the cryptocurrency is not mined like Bitcoin and Litecoin, but rather controlled with a maximum supply of 100 billion Ripple coins, and the Ripple company and its founders own a whopping 60% of it’s supply. For this reason, more than any other, is the biggest differentiating factor compared to many other cryptocurrencies. Ripple is not a decentralized cryptocurrency, but rather very centralized.
The Ripple payment network works on blockchain technology like Bitcoin and other cryptocurrencies. Ripples network can process cross-border payments in a matter of seconds and for a fraction of the cost it would take to send fiat currencies. This is what makes Ripple such an attractive cryptocurrency investment.
The current live price of XRP/USD:
How to Trade Ripple
Ripple is a very attractive cryptocurrency to many cryptocurrency traders and investors, especially to new traders in the cryptocurrency space due to Ripple’s low price. Even though Ripple has become immensely popular among cryptocurrency traders, it is still not as widely available for purchase as Bitcoin and Ethereum are. In fact, many exchanges only allow traders to purchase Ripple with Bitcoin and Ethereum.
One method is to actually purchase and trade Ripple. So, if you are a trader who wants to purchase Ripple with fiat currency, you must find an exchange that accepts your currency, most exchanges accept either US dollars or Euros. Another option, is to buy Bitcoin or Ethereum from an exchange with your Fiat money, then use your newly purchased Bitcoin or Ethereum to exchange it for Ripple. The former method is the most popular among cryptocurrency traders as Ethereum and Bitcoin are the gold standard for buying other cryptocurrencies.
Once you have obtained some Ripple, you can either hold your coins in a cryptocurrency wallet supporting Ripple and wait for the price to rise before you sell back to fiat money. Or, you can keep your Ripple on an exchange and trade it back and forth for fiat currency or other cryptocurrencies. However, you decide to trade Ripple, it’s important to remember that Ripple and all cryptocurrency trading is highly speculative and volatile. A trader should never invest more than they are willing to lose.
CFD Trading with Ripple
Alternatively, traders can trade Ripple by speculating on the price through a trading method called Contracts for Difference (CFD). Traders do this by putting money down and either make profit or lose depending on where the price goes. Not every cryptocurrency exchange or broker offers this method of trading. With CFD trading the price of Ripple will be quoted against the USD or another cryptocurrency to come up with a currency pair. The trader then needs to speculate on whether this asset pairs price will move up or down over time.