People often ask, Is Ripple a cryptocurrency just like Bitcoin or other popular traded digital currencies? Not exactly as there are different coins for different purposes. Ripple was originally released in 2012 as a continuation of Ripplepay as it is a real-time gross settlement system or RTGS that is employed in bank remittance (sending funds, transferring funds) and currency exchange (Yen for Euros or US dollars). This system is a ledger that is common across member banks that automatically and constantly compares transaction records via servers. Ripple does not rely on energy and computing intensive proof-of-work used by Bitcoin. It is based on a shared public database that uses a consensus system to validate servers to ensure integrity.
Think of a bank transfer or bank remittance – the Ripple protocol which uses XRP is meant to ensure instant or very near instant and direct transfer of money or funds between two parties. Push a button, send the money in seconds. Fees and waiting times are reduced dramatically, saving costs and time.
Ripple can handle 1,500 transactions per second and is being upgraded to scale of 50,000 transactions per second with is the same as VISA. Ripple hit the news in Japan in 2017 as a consortium of 64 banks – across Japan – signed up to start using the system which would link all major banks and transaction volume for millions of Japanese citizens transferring funds from Osaka to Tokyo to overseas accounts.