What is Ripple?

Ripple is a privately held company formerly known as OpenCoin, which builds a payment and trading network (RippleNet) based on a Distributed Accounting Database (XRP Ledger). Ripple’s primary goal is to connect banks, payment service platforms and digital asset exchanges, enabling faster and cost-effective global payments.


Ripple was launched in 2004 by Ryan Fuger, who developed his first prototype as a decentralized digital monetary system (RipplePay). The system became operational in 2005 and aims to provide secure payment solutions within a global network.

In 2012, Fuger relinquished the idea of ​​the Jed McCabe and Chris Larsen co-founded the US technology company OpenCoin. From that point forward, Ripple began to build itself as a protocol focused on payment decisions for banks and other financial institutions. In 2013, OpenCoin was rebranded to Ripple Labs, which in 2015 again rebranded this time in Ripple.

XRP Accounting Book (XRPL)

Based on Ryan Fuger’s work and inspired by the creation of bitcoin , Ripple introduced in 2012. its Ripple Consensus Ledger (RCL), along with its own cryptocurrency called XRP. The RCL was later renamed XRP Ledger (XRPL).

XRPL operates as a distributed economic system. Not only does it store all the accounting information of participants in the network, it also provides exchange services for multiple currency pairs. Ripple introduces XRPL as an open source distributed ledger that enables real-time financial transactions. These transactions are secured and verified by network participants through a consensus mechanism.

Own consensus algorithm

Unlike Bitcoin, however, XRP Ledger is not based on the consensus algorithm of “Proof of Work”, which means that it does not rely on the extraction process to verify transactions. Instead, the network achieves consensus by using its own custom consensus algorithm known as the Ripple Protocol Consensus Algorithm (RPCA).

XRPL is managed by a network of independent validating nodes that constantly compare their transaction records. Each participant is able not only to set up and execute the Ripple validator, but also to choose which nodes to trust as validators. However, Ripple recommends that its customers use a list of identified, trusted participants to validate their transactions. This list is known as the Unique Node List (UNL).

UNL codes exchange transaction data between them until they all agree on the general ledger’s current state. In other words, transactions negotiated by the preferred UNL nodes are considered valid and consensus is reached when all these nodes apply the same set of transactions to the ledger.

According to Ripple’s official website, Ripple is a privately held company that laid the foundations for developing XRPL as an open source distributed ledger. This means that anyone can contribute to the code and the XRPL is able to continue operating even if the company ceases to exist.


Unlike XRPL, RippleNet is an exclusive part of Ripple’s portfolio. It was created on the basis of XRPL as a payment and exchange network.

RippleNet currently offers a suite of 3 products and is designed to be a solution for payments in the banking and other financial institutions. RippleNet currently has three main products: xRapid, xCurrent and xVia.

Final words

Bitcoin is known as the first cryptocurrency , and Ethereum is recognized as the basis for the creation of a smart contract platform. For our part, we can view the Ripple network as a currency exchange system that focuses on global payment solutions for banks and other financial institutions.

RippleNet can be applied to existing banking infrastructure as a way to complement and enhance the traditional payment system. xCurrent enables cost-effective real-time payments to financial institutions. xRapid uses XRP as a way for global currency transactions, providing liquidity pools when needed. xVia facilitates the integration and communication of all RippleNet participants.