What is Ripple Network?
The Ripple network’s base currency is Ripple. Ripple can circulate throughout the network. The total amount of 100 billion will gradually decrease as the number of transactions increases. (Open Coin was its predecessor.) Ripple Labs operates Ripple.
The Ripple system has only one universal currency, Ripple. Other currencies are not part of the Ripple system.
It is not possible to withdraw USD or CNY across gateways. As a result, CNY issued by Gateway A can only be withdrawn from Gateway.
In order to withdraw cash at Gateway B, you must use the ripple system’s pending order function to convert to the CNY of Gateway B before you can withdraw at Gateway B. Ripple has no restrictions on this, and it is universal.
Introduction editing Of Ripple Network
With the advent of Ripple, a global currency exchange has become easier and more convenient. Bitcoin is a virtual currency, while Ripple is a protocol that allows people to make payments in any currency over the Internet. Ripple, for instance, can be used by Party A to pay in U.S. dollars while Party B can direct collect Euros through Ripple [3].
Ripple Labs, a company in San Francisco, promotes Ripple as a standard transaction protocol used by major banks worldwide, making money transfers as simple as sending an email.
As well as being a shared ledger and a public database, Ripple is also a distributed ledger. Using the consensus mechanism, all computers in the Ripple network automatically accept updates to the general ledger without going through a central data exchange center. Ripple achieved major breakthroughs in engineering through this technology Ripple confirms transactions in 3 to 5 seconds, while Bitcoin takes 40 minutes.
Ripple Network help for small businesses
Small businesses can receive remittances in a matter of seconds from customers, regardless of where they are located. Ripple can transfer money from a consumer’s credit card to a small business’s bank account today in just three days. Quick payments are a valuable feature for managing the cash flow of the company on a daily basis.
Credit card companies will be attracted to ripple’s low transfer fees. This will reduce the expenditures of small companies in this sector.
In today’s economy, transaction fees on credit cards are extremely unreasonable for small businesses. It is possible for large companies to get more concessions than small ones.
In the case of a small company with a large international business volume, Ripple will be of great assistance to you. The process takes only 5 days and you only have to pay an average handling fee of 7% each time you transfer money abroad. The confirmation time of a ripple transaction is only 3 to 5 seconds, and ripple charges a very small fee for foreign exchange transactions.
Ripple Network and Ripple Coin
In 2004, Ripple launched an early version, but it did not succeed.
An early version of the app could only transfer money between people who trusted each other, and a trust chain was necessary.
Increasing. In 2012, OpenCoin took over Ripple, and in 2013 it released a new version. There were two new measures:
In the first part, I introduce myself. Through the Ripple gateways, funds can be imported and exported. Using Ripple, people can transfer various currencies (whether they are legal currencies in various countries or virtual currencies like Bitcoin) in and out of the Ripple (XRP) Payment System.
It is possible to transfer money between strangers through Ripple as long as both parties trust the same gateway.
In addition to allowing transfers between acquaintances, the “gateway” also allows transfers between strangers.
XI Chong will launch Ripple (the second event). The Ripple (XRP) currency serves as a liquidity tool, a bridge currency, and a medium of exchange between currencies. It is difficult to transfer or withdraw funds from Ripple gateways if they are not exchanged for XRP; meanwhile, Ripple can travel freely between any gateway. The second function of XRP is to prevent spam attacks and ensure the safety of the system.
The working principle of the Ripple system
Ripple operates as follows: using its gateway or XRP as a bridge, user A converts any type of currency or virtual currency into Ripple XRP, then sends it to user B, and user B can receive it. Recipients exchange the received funds into their required currency.
There is another mode in which user A will deposit the funds in B’s trusted gateway and transfer it to B through the gateway. Additionally, users can issue their own “private currency” through the Ripple system. Ripple user A can exchange the “private currency” he issued with another user who trusts him (user A) and is willing to accept B into U.S. dollars or Bitcoin, etc. User A can redeem the currency exchanged to B at any time. This is actually a borrowing process, and User A has the financial power to borrow from other people.
As far as its overall structure is concerned, Ripple uses a “decentralized” architecture.
While some components appear to be weakly centralized (such as gateways and users), the overall architecture is decentralized. In a nutshell, this is a decentralized Internet financial transaction system covering all currencies.
A public ledger is maintained throughout the Ripple network by the protocol. The protocol features consensus.
Using these two methods, the general ledger is updated in a timely manner.
Ripple system generates
A new sub-ledger instance every few seconds, and new transaction records are generated in these few seconds. It is quickly verified according to the consensus and verification mechanism. Such sub-ledgers are arranged in chronological order and linked together to form the general ledger of the Ripple system. Ripple’s “consensus mechanism” allows all nodes in the system to automatically receive pairs within a few seconds. Using a central data center Transaction records in the general ledger does not need to be updated. This extremely fast processing method is a major breakthrough in the Ripple system.
Ripple’s system differs from Bitcoin’s data record packaging and transaction confirmation methods in two ways. First, the packaging speed of transaction records (blocks) is faster (Bitcoin takes about ten minutes, while Ripple only takes a few seconds).
Secondly, the confirmation method of transaction records (blocks) is faster (Bitcoin requires multiple nodes to confirm one by one. While Ripple requires all nodes to confirm simultaneously, a consensus mechanism). Ripple’s new transaction record is confirmed in 3 to 5 seconds, while Bitcoin generally takes 40 to 50 minutes.
Grid trend
Virtual currency investors have long been interested in Ripple. In May 2013, the unit price of each Ripple reached 0.15 yuan. Despite this, the price of Ripple fell sharply last month and fell below 0.02% Chinese Yuan. As the price of Bitcoin soared at the end of 2013, XRP’s price once reached more than 0.5 yuan. When JED, the co-founder of Ripple laboratories, a Ripple operating company, announced he would polish all 9 billion Ripples he held within 2 weeks. It caused panic in the market, and the price of Ripple was quickly suppressed.
The lowest point in history was below 1 point. After JED and Ripple Labs reached a sell-off agreement, Ripple’s price was stable at around 3 cents for most of 2014 as more and more banks and financial institutions announced their support for the Ripple Agreement.The price of the Ripple Agreement spiked to a maximum of RMB 0.18 in November 2014. The price of the coin had dropped back to RMB 0.07 on March 15, 2015.
Because Ripple Labs strives to promote the ripple protocol, it does not care about the price of Ripple, but hopes to gradually increase the value of Ripple through its promotion.
Relationship between the two
Early on, Ripple’s users were few and the network was limited to small groups of acquaintances. Since its original design was based on the concept of the network of acquaintances and chain of trust. The recipient and the payer must be members of the Ripple network for remittances or lending. A network must be friends (establish a trust relationship between each other). In the absence of mutual friends (via the transmission of friends to establish a trust chain), they cannot transfer funds.
With the establishment of Open Coin, the situation has changed.
Chris Larson and Jed Mike Caleb co-founded Open coin in San Francisco in 2012, took over Ripple to form Ripple Labs, and began building the platform that represents the “future payment” to them.
According to public information, the new version of Ripple network in 2013 introduced two measures to solve the problem of isolated small circles.
Ripple-XRP
As the base currency of the Ripple network Would allow.
It is important for ripple to be free to move around the Ripple network without being limited to a small circle of acquaintances, similar to Bitcoin.
It has two functions. One is to prevent spam request attacks (due Since the Ripple protocol is open source, malicious attackers can create a large number of “junk accounts” and disrupt the network.
In order to avoid this situation, Ripple Labs requires every Ripple account to have at least 20 Ripple coins. Every transaction will destroy one hundred thousandths of Ripple. This fee is almost negligible for normal traders, but for For those who maliciously attack and create a large number of false accounts and transaction information, the destroyed Ripple coins will increase exponentially, and the cost will be huge); second, as a bridge currency, it will become an intermediate among various currency exchanges.
Gateway was introduced:
The gateway allows funds to enter and exit the Ripple network. It functions similarly to a currency deposit and exchange institution.
You can use Ripple to inject or withdraw legal and virtual currencies into or out of the Ripple network, as well as act as both parties to the transaction.
A bridge, “common friend” between strangers, is equivalent to the bank in the SWIFT agreement. Which allows transfers to take place outside of Ripple between strangers.
There is no doubt that ripple, as a brand new global payment system, has great potential and is likely to disrupt the future payment industry, as some people believe. The system’s universal currency, Ripple, seems quite promising. Ripple is not necessary for the ripple system to work normally.
There has been an error here. In the beginning, there was no Ripple, which was unable to develop before 2013. It is precise because of Ripple.
This makes the ripple system enter a new period of rapid development since 2013. Secondly, without a universal currency such as Ripple, anyone can trust a fake gateway by establishing many fake accounts. Thereby deceiving the formation of the system A large-scale fake gateway is extremely detrimental to the development of Ripple moreover. The existence of Ripple is equivalent to the lubricant and bridge of the Ripple system. Which provides great convenience for the liquidity of the Ripple system!
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