Live XRP Price: Real-Time Ripple Coin USD Exchange Rate Value

Ripple is one of the biggest companies in the crypto ecosystem, their XRP coin is the token you love to hate.

Ripple, ran by Ripple Labs (originally Opencoin), is a platform and a currency. It is made up of a blockchainless payment protocol designed as a day to day low commission exchange network using the company’s patented-technology, the Ripple protocol consensus algorithm (RPCA). The Ripple payment protocol hopes to be adopted and integrated into the existing banks of today to faciliate fast international transactions worldwide by providing a frictionlesss cross-border remittance service to help send money globally.

From founders Chris Larsen and Jed McCaleb to current CEO Brad Garlinghouse, this review of the Ripple company and XRP cryptocurrency is going to be a deep dive on how the coveted XRP coin (currently ranked #3 in total market cap) is used to represent and transfer value on the Ripple Network.

As the Ripple (XRP) user base continues to grow with bullish price predictions , let’s review ‘the other crypto’.

What is Ripple and How XRP Works

In its most basic sense, Ripple can be thought of like a real-time gross settlement system which, along with its associated cryptocurrency ‘XRP’, has been designed to make monetary transactions more streamlined and hassle free for its users. The project was launched back in 2012 as a means of providing the global finance community with an all-in-one payment processing and remittance ecosystem that could be used by several different entities such as:

• 300 financial/banking institutions (in 40 countries and 6 continents)
• Startups
• Business owners
• Consumers

As per the project’s whitepaper, Ripple seeks to replace the global payment infrastructure that is currently being utilized across the globe with a system that is not only ‘decentralized’ but also open source-based and easily accessible to people irrespective of their financial background. In addition to this, using its native token creation system the platform allows its users to devise their very own crypto and fiat currencies. As a result of these features, Ripple has been adopted by several different banking outfits as well as financial organizations because of its RippleNet growth towards being instant, reliable and cheap costs.

As the Ripple and XRP era continue, the RippleNet advantages of having speed, certainty, liquidity management and transparency are putting both the company and crypto coin in a unique position given the thousands of cryptoassets in the market today.

Reviewing Ripple’s Origins: The Who, What and When

XRP (XRP)
Rank: 4

$ 0.187742

Price (BTC)

Ƀ0.00002000

Marketcap

$ 8.31 B

Volume

$ 1.11 B

24h Change

0.13%

Total Supply

100.00 B XRP

Before we can get into the impressive Ripple resume of partnerships like American Express, MoneyGram, Santander, PNC, SBI Remit and BeeTech or acknolwedge that XRP trades on over 100 markets and exchanges, let’s go back to the beginning and unearth some of the organic origins of the company and token.

As some of our regular readers may be aware of, work on the Ripple project began back in 2004 when developers Jed McCaleb, Arthur Britto, and David Schwartz became inspired by a decentralized payment system called RipplePay.com that was devised by a Canadian web dev named Ryan Fugger. However, McCaleb’s idea was to make use of blockchain technology in order to make the aforementioned system more transparent as well as eliminate many of the inefficiencies associated with the Bitcoin ecosystem (such as excessive power consumption, poor tx speeds and centralization) – (which would later turn into Stellar Lumens (XLM)).

In this regard, it also bears mentioning that quite unlike Bitcoin, all XRP based transactions are verified through the use of a community-wide consensus vote instead of users having to rely on miners to greenlight their transactions.

In 2012, Ripple’s core dev team welcomed Chris Larsen who then requested Fugger to provide his team with the required permission to continue work on RipplePay.com and transform the platform into a full-fledged cryptocurrency and monetary system. These developments helped spur the creation of OpenCoin — an organization that would later be re-christened as Ripple Labs.

Around this time, Larsen and co also started to devote a lot of time towards the creation of what we now know as the Ripple Transaction Protocol (RTO), a system that allows users to facilitate instant transfers irrespective of their physical locations. To be a bit more specific, the protocol is compatible with a number of digital currencies as well as other asset mediums. The team programmed the RTPs core framework in such a way that it only relied on a central ledger that would be administered by several different servers continuously for transaction verification purposes.

Additionally, to help in the faster processing of individual transactions, the team behind Ripple devised a cryptocurrency called the XRP that was designed to help users move their funds around in a highly streamlined manner. If that wasn’t enough, Ripple also linked Bitcoin to its native state, thereby allowing crypto enthusiasts to use the platform to send payments directly into any BTC wallet of their choice.

All of this would essentially form into today’s RippleNet, which is Ripple’s global payments network. Here is how it works:



During the first half of 2013, Ripple Labs announced the release of its platform’s reference server and client as open source software, thereby allowing independent developers to contribute towards Ripple’s ensured future progress. Not only that, by the beginning of 2014, Ripple’s core dev team had already started to shift its focus on the banking sector, to try and replace the existing, outmoded systems that many banks are still making use of till this very day to facilitate their day-to-day transactions. In this regard, just a few months later, Munich-based Fidor Bank became the first mainstream financial entity to adopt the Ripple Transaction Protocol (RTP). This news was soon followed by the word that New Jersey-based Cross River Bank and Kansas-based CBW Bank had also followed suit.

By the end of 2014, Ripple, who wants to become the world’s most relitable global payments network, had announced several notable partnerships with big-name players such as Western Union, the Commonwealth Bank of Australia, the Royal Bank of Canada and Earthport, a global payment service that is affiliated with companies like the Bank of America and HSBC. However, the following year, Ripple Labs was fined a total of $700,000 by the Financial Crimes Enforcement Network (FinCEN) because of certain violations related to the Bank Secrecy Act. As a result of the penalty, the folks over at Ripple swiftly proceeded to add several AML monitoring modules to their protocol to make it fully compliant with existing U.S. finance laws.

Over the last 2-3 years, Ripple Labs has grown quite exponentially, with the organization’s offices now present in a number of different countries such as Australia, the United Kingdom, and Luxembourg.

Here is a curated image of all of the Ripple Labs investors from 2013 to 2016:

Key Points Worth Bearing in Mind

When talking about the Ripple ecosystem, native transactions only occur when users facilitate cryptographically signed transactions via XRP or a unique fiat currency of their choice. In this regard, it should be pointed out that all XRP digital asset transactions are monitored using Ripple’s internal ledger system, the XRP Ledger.

XRP is an open-source, decentralized digital asset built for payments ~ official Ripple.com website

Ever since Ripple’s cross-border tx framework was employed by several banks around the world, more and more people have begun to view crypto-enabled technologies with a more open mind.

Owing to Ripple’s ever-increasing adoption across a wide array of mainstream financial domains, a large number of investors and traders are now beginning to trust the platform. And while we are on the noteworthy topics of interest in the Ripple ecosystem, let’s stick this statement in there as it is one of the bigger macro-talking points about the Ripple vs XRP debate which we will review below.

Ripple and Mining

Unlike other popular cryptocurrencies like Bitcoin, Ethereum and Monero, XRP cannot be mined. This is because while BTC and other similar digital assets make use of miners to process their native transactions, transfers associated with Ripple are facilitated through the use of a system-wide user consensus framework (which essentially renders the concept of mining useless).

Additionally, it should also be pointed out that upon its inception, Ripple’s core design team only created a total of 100,000,000,000 XRP — a figure that has not wavered since, despite continued community complaints regarding the same. Also, it bears mentioning that upon XRPs release, a number of people criticized how the currency was being distributed, with the founders retaining 20 percent of all XRP tokens.

Lastly, because of its “zero mining potential,” a number of crypto enthusiasts have called out the digital currency for being too centralized. Not only that, but the aforementioned fact has also limited the overall use and growth of the project in some ways.

What Distinguishes XRP from Other Premier Cryptocurrencies?

Unlike Bitcoin, Ripple comes backed by a full-fledged monetary ecosystem that can be utilized for a wide array of purposes. Similarly, when compared with Ethereum (a platform that is designed primarily for computing purposes) Ripple deals exclusively with financial functions such as remittances, cross-border txs etc. This is the very reason why Ethereum, EOS, Bitcoin have not been adopted by banking institutions — since they lack the basic infrastructure needed to process voluminous monetary transfers.

What is the Ripple Transaction Protocol and who controls it?

The Ripple Transaction Protocol (RTP) is a digital framework through which all of Ripple’s monetary processes take place. This is in stark contrast to other cryptocurrencies that make use of a blockchain consensus algorithm to facilitate/process their transactions.

While we are on the subject, it would also be useful for our readers to understand that all transactions taking place within the Ripple ecosystem require a certain level of pre-existing trust in order to proceed. What this means is that if two users have not established a trust relationship already, the tx in question will stay in limbo until a linear path involving all of the associated parties is established. The aforementioned concept has been borrowed from Islamic banking principles wherein all exchange of money is done through the use of mutual trust relationships instead of charging the other person an interest rate.

Now, talking about who controls Ripple, a quick look at the project’s core infrastructure we can see that the project is far more centralized when compared to a host of other cryptocurrencies. This is because Ripple Labs still maintains a leading role when it comes to the development of XRP. Not only that, the organization also owns a major share of all XRP that is currently in circulation today.

XRP: An in-depth Ripple Cryptocurrency Coin Look

In its most basic sense, XRP can be viewed as the cryptocurrency that powers the Ripple ecosystem. In this regard, a perfect analogous comparison would be that of Ether and Ethereum platform.

In terms of XRP’s value, the currency’s price is determined simply by how many people (at any given point in time) find the asset useful. Also, due to Ripple’s amazing utility as a financial services platform, a number of established banks have started to adopt the technology to enhance their overall tx efficiency. This has helped spur the price of XRP and has given it the market strength that very few other digital currencies currently enjoy.

As mentioned previously, back when Ripple was first launched, the project’s core dev team created a total of 100,000,000,000 XRP that were meant to be used for all transaction related purposes. Also, unlike other cryptocurrencies, XRP is unmineable, but its total circulation supply can be increased — however, there are no plans to do such a thing anytime soon.

From an acquisition standpoint, we can see that quite like most of the other cryptocurrencies in the market today, XRP too can be purchased from a number of different exchanges and trading platforms with the touch of a button. Similarly, storing XRP is also quite straightforward and can be done using a number of different wallet solutions.

What Advantages Does Ripple Offer?

Mainstream Adoption: Ripple is currently backed by a whole host of mainstream financial institutions and payment providers including HSBC, Western Union, CBA and the Royal Bank of Canada. This puts Ripple in a unique position of mainstream acceptance that a few other digital currencies currently enjoy.

Regulatory Green Light and Versatility: From the very beginning, Ripple has laid great importance on establishing its core framework in line with the regulatory requirements of various finance agencies across the globe. To better understand the scenario, we can see that Ripple can be used to generate custom tokens while the XRP can be traded against a host of digital commodities such as frequent flyer miles, cell phone minutes etc.

Low Tx Costs: When compared to many of its associated crypto offerings, Ripple possesses a host of niche’ advantages (such as low transaction fees, payment freedom, and global availability) that make it unique. Not only that, but XRP is also one of the fastest digital assets on the market today (which is also the reason why the currency has been adopted by so many banking institutions.)

The XRP Coin Downsides

Finite Supply: One of Ripple’s biggest issues is its finite supply — which is currently capped at the 100,000,000,000 mark. And despite the project’s core backing community repeatedly calling for the currency’s supply to be increased, Ripple’s dev team has time and again refused to create more XRP — something that has lead to the creation of certain deflationary/supply related problems with the project.

Centralization: As mentioned before, a whopping 20% of XRP’s total supply belongs to Ripple’s founders. On top of that, Ripple cannot be mined, an aspect that is considered to be one of the biggest drawbacks of the premier asset.

Past Troubles: In the past, Ripple Labs has faced legal action from regulatory authorities such as the FINCEN. For example, it should be pointed out that in 2015, the government agency fined Ripple Labs a whopping sum of $700,000 for violating the Bank Secrecy Act. Similarly, Ripple was also sued last year for alleged fraud concerning an ICO scheme.

Lack of Transparency: A major issue with Ripple is that XRP transactions can be frozen by the system. An example of this is when a couple of years back, co-founder Jed McCaleb tried to liquidate $1 million worth of his XRP holdings — an action that was halted by a third party entity. This episode not only left a bad impression on the global crypto community (regarding XRPs overall utility) but also resulted in many people arguing that the idea of a transaction being halted by a third party entity runs counter to the very foundation of what blockchain tech and crypto stand for.

How Does Ripple Work?

As Ripple’s widespread popularity has continued to surge, more and more institutions are beginning to employ XRP as a mediator in their fiat currency exchanges. This is because a whole host of different financial assets cannot be swapped in exchange for each other directly. Instead, they need to be traded through the use of the US dollar — which serves as an intermediary swap facilitator. In this regard, Ripple fulfills the same function, but at a processing cost, that is substantially lower than a USD-based tx.

Additionally, as mentioned in an earlier section, Ripple is now also being used by many international banks to speed up their cross border transactions. To elaborate on the matter, we can see that Ripple currently boasts of a TPS rate of four seconds per transaction. This figure is not only much higher when compared to other similar digital currencies, but it is also much faster when compared with the tx capacity of various traditional banking systems.

Lastly, Ripple’s ecosystem has been designed in a way that allows users to devise their very own custom tokens that are backed by XRP.

Safety: Is using XRP really Secure?

Straight out the door, it needs to be made clear that any monetary system that relies on a computer or other digital platform can never be 100 percent safe. However, in regards to Ripple, we can see that the technology makes use of a number of protocols that make it extremely secure — so much so that many banks have decided to forego the use of their natve tx systems in favor of Ripple’s blockchain tx platform.

Also, from the very beginning, it has been quite obvious to the global crypto community that Ripple is designed primarily to work within the confines of today’s existing financial laws — which basically means that the platform conforms to the same regulations that conventional banks and payment providers have to adhere to.

Lastly, over the past 4-5 years, a number of digital currency enthusiasts have slighted Ripple for being too centralized. This has given birth to many fears that the project might, in fact, be just another elaborate ponzi scheme or scam. However, since Ripple has adhered to various mainsteram financial regulations from day one, this narrative has failed to gather any sort of real momentum.

Ripple vs Bitcoin

A question that many budding crypto investors and tech enthusiasts seem to often as is, “If Ripple is so much more advanced than BTC, how come its use is still quite limited when compared to the flagship cryptocoin?”. The simple answer is that Bitcoin and XRP serve two completely different functions. For example, BTC is meant to serve as an SOV that can also be used for financial transactions. However, Ripple is more of a consolidated financial services platform that makes tx’s faster, streamlined and secure for its users. With that being said, Bitcoin’s simplicity is what makes it more appealing to many investors over other premier digital assets such as ETH, EOS, ADA and XRP.

From an adoption standpoint, Ripple faces quite a battle because many vendors still prefer to make use of BTC due to its market reputation and overall ease of use.

As things stand, the number of merchants making use of BTC far outweighs those using XRP.

How is XRP as an Investment Vehicle?

While many people continue to stock up on BTC and ETH because they think these assets will continue to multiply in value as we move into the future, the question of whether XRP can be used for similar purposes is also gaining a lot of momentum in recent years.

While XRP does not guarantee any profits, the fact that its parent platform (Ripple) is becoming increasingly popular amongst a whole host of mainstream financial institutions, puts the currency in a unique position of profitability than other crypto coins don’t currently enjoy.

Plus, thanks to the overall versatility of the Ripple network, more and more companies are finding new ways in which to make use of the technology. This has propelled XRP into the realm of the world’s most traded cryptocurrencies.

Current Ripple Company Partnerships

In this section, we will look at a detailed list of all the financial institutions that are currently a part of RippleNET — a diverse ecosystem comprising of central/private banks, remittance firms, brokerages and payments providers that make use of one or more of Ripple’s remittance systems (i.e. xRapid, xCurrent, and xVia). These platforms have been tested quite thoroughly and many independent researchers have found that they are demonstrably better than the SWIFT protocol in terms of:

• Transaction times
• Processing fees
• Uncertainty in transaction execution

For those of our readers who may not be aware of what SWIFT is, it can be thought of as a messaging network that is currently being used by a wide array of banks/financial institutions to send and receive information (as well as money) from each other.

Also, it bears mentioning that all of the entities that are currently a part of RippleNET can make use of the network to facilitate their intl. transactions in a highly streamlined manner.

In regards to some of the banks that are currently making use of Ripple’s various cross-border services include established players such as Standard Chartered, RBC, SBI, Axis and RakBank of UAE is up and running. Additionally, a number of corporate giants (such as Accenture, Deloitte, Santander, UBS, UniCredit) too are utilizing Ripple’s framework to make their internal transactions smoother and more hassle-free.

Provided below is a detailed list of all the banks that have signed a partnership/agreement with Ripple:

(i) North America and Canada:

• American Express
• Standard Chartered
• Bank of America Merrill Lynch
• PNC Financial Services
• Cuallix
• Catalyst Corporate Federal Credit Union
• Star One Credit Union
• CBW Bank
• Cross River Bank
• Royal Bank of Canada
• DH Corporation
• Canadian Imperial Bank of Commerce
• Scotiabank
• Bank of Montreal
• ATB Financial
• TD Bank Canada
• Saldo

(ii) The United Kingdom, Spain, France, Germany and other smaller European Nations:

• Interbank
• Euro Exim Bank
• Bank of England (Central bank)
• HSBC
• Barclays
• Vitesse
• Royal Bank of Scotland
• Credit Agricole
• Natixis
• Banco Santander
• BBVA
• Banca Intesa Sanpaolo
• UniCredit
• Reise Bank
• Fidor Bank
• Rabobank
• Erste Group AG
• UBS
• Credit Suisse
• Nordea
• Skandinaviska Enskilda Banken AB
• Akbank

(iii) Middle East — Israel, Kuwait, Lebanon, Saudi Arabia,

• Bank Leumi Le-Israel
• National Bank of Kuwait
• Kuwait Finance House
• Bank Dhofar
• Saudi Arabian Monetary Authority (Central bank)
• First Bank of Abu Dhabi
• RakBank
• Al Rajhi Bank

(iv) Asia — Singapore, Thailand, Vietnam, India, Indonesia, Japan and S.Korea

• DBS Group
• OCBC Bank
• United Overseas Bank
• Singapore Exchange
• Krungsri
• Bank of Thailand (Central bank)
• Bank of Indonesia (Central bank)
• Siam Commercial Bank
• Cargills Bank
• Kotak Mahindra Bank
• IndusInd Bank
• Axis Bank
• Yes Bank
• Faysal Bank
• Shanghai Huarui Bank
• Woori Bank
• SBI Holdings
• Mitsubishi UFJ Financial Group
• Fukui Bank
• Star Bank
• Aomori Bank
• Ashikaga Bank
• Awa Bank
• AEON Bank
• Senshu Ikeda Bank
• Iyo Bank
• Oita Bank
• Orix Bank
• Gumma Bank
• Keiyo Bank
• San-In Godo Bank
• Sikoku Bank
• 77 Bank
• Shimizu Bank
• Juroku Bank
• Shinkin Central Bank
• Shinsei Bank
• Hachijuni Bank
• Bank of Yokohama
• SBI Sumishin Net Bank

(v) Australia and New Zealand

• ANZ
• Westpac
• Commonwealth Bank of Australia
• Macquarie Group
• National Australia Bank

Now that we have listed out a majority of the banks that are currently making use of RippleNET, let’s take a look at some of the mainstream payment/remittance providers that too have ported their existing systems onto one of Ripple’s cross-border payment platforms. Some of the key names include:

• American Express FX International Payments
• InstaRem
• SendFriend
• Beetech
• Viamericas
• Transpaygo
• UniPAY
• MoneyGram
• Zip Remit
• Itau Unibanco
• Western Union
• UAE Exchange
• TransferGo
• SBI Remit
• FlashFX
• Earthport
• Mercury FX
• Cambridge Global Payments
• Finastra
• Davis + Henderson (D+H)
• Finablr
• LianLian Pay
• IDT
• GoLance
• AirWallex
• Dlocal
• TAS Group

Ripple: A Brief Timeline of the XRP Coin

Bitcoin

$ 9,461.34

$ 9,461.34

1.18%

Ethereum

$ 237.03

$ 237.03

3.17%

Tether

$ 0.999608

$ 0.999608

0.11%

XRP

$ 0.187742

$ 0.187742

0.13%

Bitcoin Cash

$ 237.28

$ 237.28

2.17%

Bitcoin SV

$ 174.30

$ 174.30

1.44%

Litecoin

$ 43.68

$ 43.68

1.14%

Cardano

$ 0.081597

$ 0.081597

2.29%

Binance Coin

$ 16.28

$ 16.28

1.6%

EOS

$ 2.56

$ 2.56

0.96%

2011 — The Origins

While not a lot is known about how Arthur Britto, Jed McCaleb, and David Schwartz came together, it is a well documented fact that the aforementioned individuals came across each other sometime during the spring of 2011. Over the course of the year, this small group continues to work on the development of XRPs basic ledger framework.

2012 (August) — Larsen joins the crew

During August 2012, McCalen, Britto and Schwartz are joined by a famous developer and blockchain enthusiast by the name of Chris Larsen, who had previously worked for a number of successful fintech projects such as E-Loan and Prosper.

2012 (October) — Fugger gives permission

A couple of months after Larsen joins Ripple (not known by that name at the time), the team approaches Ryan Fugger — creator of the original RipplePay website back in 2004 — to continue dev work on his brainchild. Fugger agrees to support the new project and thus spurs the creation of a new firm called OpenCoin.

2013 (February) — Promotions commence

During the latter half of February 2013, OpenCoin starts to advertise itself on Bitcointalk.org (a popular crypto web portal). The promotion campaign goes on for a few months, with the terms of the deal being quite simple — all new sign ups receive 1,000 XRP.

2013 (March – May) — Funding and growth

During the first half of 2013, Ripple continues to make waves across the world. This is because during a period of 2-3 months, the firm is able to raise a substantial sum of money from a number of established angel investors such as:

• Pantera Capital
• Andreessen Horowitz
• Lightspeed Venture Partners
• FF Angel LLC
• Vast Ventures
• Bitcoin Opportunity Fund
• IDG Capital Partners
• Google

Additionally, it should also be pointed out that during the funding period of Ripple’s early operations, Ripple Labs essentially gave out a certain percentage of ownership of the company to various investors who had shown trust in the project.

2013 (Q3) — OpenCoin changes its name officially

As part of the Money 2020 Expo 2013, representatives for OpenCoin announce that their firm is officially changing its name from OpenCoin to Ripple Labs. The move, in hindsight, proves to be an amazing PR decision, since the term Ripple has now become synonymous with the crypto industry.

2013 (November) — New collaboration announced

During the last week of November, Ripple Labs decides to collaborate with Georgia Tech’s Computing for Good (C4G) initiative.

2014 (January-March) — XRP daily tx volume continues to increase

During the first half of 2014, XRP’s transaction throughput continues to increase, with many exchanges reporting the currency’s daily tx volume to be around the $40 million mark.

2014 (October-November) — Popularity surge continues

Owing to Ripple’s amazing tech capabilities, the platform continues to become increasingly popular all over the globe. Not only that, many developers start to take notice of the project and promote its potential within the global finance sector. In a similar vein, during the latter half of November, Ripple starts to pitch its technology to various banking institutions and remittance providers.

2015 (March) — A controversy erupts

In a sudden turn of events, Ripple Labs restricts Jed McCaleb (one of the co-founders of Ripple) from selling his personal XRP holdings. In all, it is reported that Jed tried to offload a total of 100 million XRP to an unidentified individual for a sizeable sum of $1 million.

To stop the sale from going through, Bitstamp chooses to freeze it’s USD tokens in Jed’s wallet.

2015 (April) — Expansion continues

Owing to Ripple’s ever-increasing popularity, the project continues to expand its operations and set up new offices in locations all over the globe. In April, Ripple Labs opens a new research center in Sydney, Australia to boost its R&D efforts in a big way.

2015 (September) — The rise of XRPChat and downfall of XRPTalk

Within a single month, XRPTalk — an independent platform that provided Ripple enthusiasts with an avenue to come together and debate/discuss XRP-related news (without the negativity that pervaded Bitcointalk.org) — shuts down. The project is the brainchild of an individual referred to as Hurukan. By the end of the month, the forum is no longer online and a new project called XRPChat starts to gain traction amongst the global crypto community. Quite similar to its predecessor, XRPChat also provides its users with a forum to discuss a wide array of matters related to Ripple, XRP and the Interledger Protocol.

2016 (January) — Garlinghouse takes over

During the second week of January, Ripple formally introduces Brad Garlinghouse as its new CEO. Garlinghouse was formerly the CEO and Chairman of Hightail and had also previously held high-ranking positions at a number of other different firms such as AOL (President of Consumer Applications) and Yahoo (Senior Vice President).

2016 (February) — McCaleb lawsuit gets settled

After months of the lawsuit staying in limbo, Jed McCaleb and Ripple Labs finally come to an agreement wherein Jed agrees to a host of resale conditions related to his personal XRP holdings.

2016 (March-July) — Expansion continues

Ripple’s clout continues to increase globally, with the firm opening a string of European offices in premier cities such as London (March) and Luxembourg (June). Following this period, there is also a significant increase in the daily trade volume of XRP.

2016 (September) — New investors continue to flock towards Ripple

By the end of September, Ripple’s technological offerings continue to lure in more and more high profile investors. Some big-names include Standard Charter, Accenture, SCB Digital Ventures, SBI Holdings, Santander Innoventures, CME Group, and Seagate Technologies.

2016 (November) — Tiffany Hayden makes her presence felt

Sometime during mid-November, Tiffany Hayden, the CEO of XRP, is named as one of the most influential leaders within the blockchain industry by a respected media outlet. This helps boost the company’s market profile and further increases consumer interest in Ripple/XRP.

2017 (March-April) — New features added

Between March and April, Ripple’s development team announces the addition of two new features to its existing financial ecosystem — namely, Escrow and Payment Channels. These features help in increasing the general performance and scalability of The Ripple Consensus Ledger (RCL). Not only that, they also allow companies to adopt the RCL as well as the Interledger Protocol (ILP) with much more ease.

Around the same time, Ripple released a blog post announcing its decision to sign partnerships with a total of 10 new banks. Some big names in this regard include:

• BBVA in Spain
• MUFG in Japan
• Akbank in Turkey
• SEB in Sweden
• Axis Bank and Yes Bank in India

2017 (May-July) — XRP trading pairs included on Kraken

During May, Kraken — one of the top cryptocurrency exchange platforms in the world at the time — announces its decision to add a total of four different XRP trading pairs (RP/EUR, XRP/JPY, XRP/USD, and XRP/CAD) to its native tx interface.

2017 (September) — Lawsuit brought forth against Ripple by R3

A few days into September, R3 LLC, an enterprise blockchain technology company, sues Ripple in relation to a specific legal agreement where the firm had agreed to sell up to 5 billion XRP for a certain price. In return, Ripple countersues R3 stating that the company had reneged on a number of contractual promises, and the lawsuit was a ploy to cash in on XRPs increasing monetary success. In the end, a Delaware judge provides a ruling that sides with Ripple’s version of the story.

2018 – present

During the first week of January 2018, the price of XRP hit its all-time high, with single token trading for a whopping sum of $3. However, in subsequent months, the asset witnesses a gradual decline, with the currency closing out the year at a dismal price point of $0.37. In a similar vein, it bears mentioning that XRP’s performance all through 2019 remains quite disappointing. For example, over the last 9 months, the digital asset has continued to slide — with its value decreasing by a further 15% during the aforementioned period.

Lastly, it bears mentioning that during mid-2018, a class-action lawsuit is filed against Ripple in which the claimant alleges that the firm has propagated the use of a scam that allowed it to “raise hundreds of millions of dollars through unregistered sales of its XRP tokens.” The case is still in court and will hopefully find resolution soon.

Next, let’s move on to our last two main ripple review points in covering the misconceptions between Ripple vs XRP differences, being the company and the coin, and finally the promising predictions and exciting expectations coming from Ripple for XRP.

Ripple (Company), XRP (Coin) and Their Relationship

Ripple and XRP have generally created misunderstandings across the cryptocurrency community. Can we use them interchangeably? Is XRP the same as Ripple? Is XRP a security? These are concepts that yet generate some doubts to crypto investors and users. Nevertheless, in a recent article released by Thomas Silkjaer in Forbes, he provides a clear answer to 14 common misunderstandings about Ripple and XRP.

To expand on above, let’s review the differences between Ripple and XRP and attempt to clear up any misconceptions floating around the XRP army community.

Ripple is a company that aims at improving cross-border transactions with products and services that it has developed. In general, banks and financial institutions have very costly services for sending funds abroad as the global remittance industry for international cross-border payments is north of $1 trillion annually. They are not only expensive for users but they are also inefficient because they take a long time to be settled.

The Most Common Mistakes About XRP and Ripple

Ripple has developed two main cross-border products: xCurrent and also xRapid (which is now On-Demand Liquidity (ODL). Until now, the most adopted product has been xCurrent, since xRapid was launched at the end of 2018. xCurrent is a settlement system that allows participants to send messages, clear and settle transactions.

The services provided by this product are so efficient that they are competing against the current solutions provided by SWIFT, the market leader. SWIFT’s system allows companies and firms to settle payments in a few days.

If settling transactions using xCurrent is fast and less expensive, why to use the digital asset XRP? The solution that the author of the article provides is that everything can be performed faster and in a cheaper way.

Using the xCurrent soluton, if banks have nostro/vostro arrangements, Ripple is able to change the balances on both accounts in a few seconds. Due to the fact that xCurrent is built using the Interledger protocol, it is possible to use FX rates in real time.

About it, Ripple Insights explains:

“The cost and complexity of holding these (nostro/vostro) accounts around the world is one reason why only a handful of banks can process global transactions. The burden of maintaining nostro accounts worldwide is simply unsustainable for most organizations.”

With xRapid it is possible to eliminate the need to use these accounts. xRapid sources liquidity on-demand allowing institutions to purchase XRP for Fiat, make a transaction, and sell the XRP for fiat once again. This can be processed in just a few seconds.

Thus, the first point that Silkjaer makes is that XRP is not needed to process transactions, but it can be used by firms if they want to reduce costs even further.

The second misunderstanding that he talks about is related to XRP volatility and how banks could be affected by it. XRP is clearly volatile. This is how virtual currencies work. They can fluctuate in just a few hours. That means that banks are exposed to these exchange rate fluctuations for a long period of time.

Nevertheless, there is no need for institutions to hold the XRP cryptocurrency. At the same time, the xRapid product works in a very fast way. Institutions purchase the asset, make the transfer, and sell the XRP in a few seconds. A transaction could take just 4 seconds to be confirmed by the network. This is much less than the 10 minutes that are necessary for Bitcoin (BTC) to be settled.

In general, handling fiat currencies for long periods of time is related to volatility. The Euro just dropped almost 1.2% against the US dollar in just a few minutes on March 7. In just a year the Euro dropped 10% compared to the US dollar.

In sum, it is not necessary for parties using XRP to hold the digital currency. They only have to handle them for a few seconds. Instead, using fiat currencies in nostro/vostro accounts, the fluctuation rates for longer periods of time could have a larger effect on the institution.

Stablecoins could also play an important role in helping companies process cross-border transactions. As they are linked to a fiat currency and their value fluctuates very little in comparison to XRP, they might be a good choice in some situations.

However, handling stablecoins is not the same as moving value across borders. Bitcoin, Litecoin (LTC) or XRP there is no promise of value. They are valuable assets per se. Meanwhile, stablecoins are just a promise of value in the future.

Stablecoins can be easily moved and provide stability, but their value ultimately depends on the funds behind them. Thus, the stablecoin is as volatile as the currency it is pegged to and it is issued by a third party that has the necessary fiat to back them all.

Using XRP of other virtual currency that is based in a decentralized blockchain network does not require firms to trust other institutions. The whole network works by itself and if a transaction is processed, it will arrive and the value would have been moved.

Another discussion that Silkjaer brings is related to digital currencies issued by central banks. Could they compete against XRP? Clearly, they are able to do so. The same as with stablecoins. Financial companies and firms would have to place their trust in a centralized authority that is the same institution that created the fiat currency that backs the central bank digital currency (CBDC).

To understand if a CBDC is a better fit for financial companies, it is important to take into account the liquidity of a specific corridor, and whether it is a better fiat than XRP for this specific transaction.

The author of the article debates a very controversial topic. Is XRP a real cryptocurrency? There are individuals that claim that XRP is not a cryptocurrency. But it is important to understand what digital currencies are. Silkjaer provides the reader with three different definitions from the Oxford Dictionary, from Merriam-Webster and from Wikipedia.

He summarises the three definitions in the fact that they need encryption techniques to verify transactions, a decentralized system and no central issuing or regulating authority. As the author of the article believes, these apply to XRP.

He explains that the misconception regarding this issue is related to the fact that XRP does not use Proof-of-Work (PoW) or Proof-of-Stake (PoS) as a consensus algorithm. The XRP uses a consensus mechanism and participants have no rewards for being part of this network.

Is XRP decentralized? This is another controversial topic that the crypto market tends to evaluate and discuss. PoW and PoS rely on the calculation of hashes in order to verify transactions and unlock rewards for miners and stakers.

Ripple is based on Consensus, which is different than PoW and PoS. Consensus eliminates the risk of double spending on the network that PoS and PoW could eventually experience in the case of a 51% attack. Moreover, Ripple has different validators that work around the world and Ripple Labs accounts only for 4 percent of the total number of validators in the network.

Furthermore, the Consensus mechanism makes forks easily possible. There are several participating nodes which trust a different number of validators each. As Silkjaer explains, the first part of the Consensus is agreeing which transactions include in the upcoming ledger. The second part of the Consensus is validation.

Validators validate transactions independently. This results in an identifying hash of the ledger. The hash is then used to compare the results amongst the validators, and after consensus is met, the “winning” version of the ledger will be used.

One of the misconceptions that the community has about XRP is related to the fees that they have to pay to perform a transaction. In this case, using the XRP ledger includes a fee. Larger fees would allow transactions to be processed faster by validators.

However, the fee paid by users is not returned to a central authority, but instead, it is burned, making XRP a deflationary currency. When creating an account on the XRP ledger it is necessary to have a small “reserve.” The fees and reserves were created to avoid spam and malicious attacks. At the moment, the base reserve is 20 XRP.

Another controversial topic is related to who created XRP. The author of the article mentions that in 2004, a developer named Ryan Fugger developed a payment protocol and decentralized platform called Ripplepay.

Later in 2011, Arthur Britto, Jed McCaleb and David Schwartz started working on the XRP ledger in order to eliminate the risks of 51% attack that Bitcoin could eventually experience.

In 2012, Chris Larsen joined the team and Fugger decided to start a new company known as OpenCoin. Until 2013 they gathered $9 million and they created the Ripple Labs company making the source code public.

The founders of the company decided to donate XRP to the company (OpenCoin at that time) and they also kept some funds for themselves.

About Ripple issuing XRP, he commented:

“Whether Ripple issued XRP is at best a blur. The XRP ledger was developed before the company was formed, but the founders of the company were also the people who developed the ledger.”

There are some individuals that believe that Ripple can print more XRP. However, there are no current methods for this to happen. It is not possible to create more XRPs. As the network is “decentalized,” as explained before by Silkjaer, to create more XRP it is necessary for the whole network to approve a major code change.

Ripple controls around 60% of the total XRP supply and it works as part of its revenue model. However, the company cannot access to large amounts of XRP. These funds are locked in escrow and the company can release just 1 billion every single month. The intention is to avoid flooding the market and other further problems. Thus, they sell the XRP coins on OTC or institutional investors.

Ripple sells XRP in order to sustain its business, but once the funds end, they will not have any revenue from the XRP cryptocurrency. Nevertheless, as Ripple’s software is “likely” subscription based (which details about the new RippleNet Home release), onboarding clients will be providing a continues revenue stream.

There are many other things that users believe incorrectly about Ripple. However, XRP has proven to be useful for many companies around the world and individuals that want to process cross-border transactions in an easy way. One of the firms that is implementing Ripple’s technology is BeeTech Global, a company located in Brazil and that allows customers to process payments around the world in a fast and cheap way.

What the World Looks Like For Ripple in 2020: XRP Expectations?

While it has divided members of the crypto community ever since it emerged on the scene, Ripple has remained entrenched as a strong performing payment solution for financial institutions, while also being one of the top 5 cryptocurrencies on the scene with XRP. This is particularly impressive considering that it was one of the cryptocurrencies which bore the brunt of the long bearish trend which epitomized the year of 2018.

Even with these setbacks in mind, investors put a lot of emphasis and faith into Ripple as a competitor to the top contenders within the crypto space, but even with these high hopes, the future remains a challenging thing to predict, as there are a lot of factors that we, as traders need to take into consideration.

Some of the questions that need to be asked is what exactly is going to drive the growth of Ripple over the course of this year? And is it at all possible for XRP to break past the $10 mark, let alone the $5 or $1 price margins over this year?

The best first step, when it comes to these questions, is the take a look at the technical and financial elements.

Is Ripple Still a Powerful Force?

The underlying purpose of Ripple in its conception is to provide a more effective and rapid system of completing remittances and cross border payments in a way which proves to be far faster than the institutional system of ‘Nostro Accounts’.

For Ripple, and its products such as xRapid, cross border payments are made by using XRP tokens, of which the majority are held by the developer itself. These tokens are used as a medium of transaction internationally, with users converting fiat currency into this crypto in order to be rapidly exchanged overseas.

How fast is this compared to the ‘current’ system of international transactions? Ripple’s own financial system takes roughly four seconds.

With this in mind, why exactly is it that Ripple proves to be so technically advanced when compared to other crypto assets that are on the market? This is mainly due to the fact that the commission on Ripple exchanges is far lower than its competitors, especially when performed through major banking institutions ($0.00001).

It is because of this attribute that it proves far more capable, and successful in gaining traction over time, especially as scalability and congestion impact on Ethereum, and sluggish transaction speeds hamper Bitcoin.

Bottom line – Banks like fast, Banks like cheap, so with Ripple and xRapid, they manage to get both as a solution to a time consuming and an expensive old system of cross border payment solutions.

Some of the advantages that Ripple manages to boast include:

• Rapid transaction system which takes approximately 4 seconds.
• Far more resilient to issues with network downtime, as well as resistance in the face of cyber-attack.
• Remarkably low transaction fees, especially in comparison with its counterparts.
• Ripple allows for the exchange of any kind of fiat currency or real-world asset (Commodities such as Oil and/or Gold) with a uniform range of commissions.
• The underlying blockchain is controlled and managed by Ripple Labs, which gives XRP and Ripple a greater degree of legitimacy in the eyes of institutions, including major multinational banks, such as Union Credit, UBS, Santander and many more.

The State of Ripple – Its Price Forecast Over 2020 in Technical Terms

There are a wide range of websites and exchanges which boast analysts and crypto personalities that offer some kind of predictions when it comes to the world of Ripple. For these people and predictions, they base them off technical analyses of forecasting charts, the price performance of XRP over time, and the underlying trends which can come to profoundly influence the market.

So with all of these potential metrics to call upon, is there a general consensus?

One thing that they appear to come to the same conclusion on is that the value of XRP will not be rising above the $1 mark for the foreseeable future. An example of this includes a forecast from Wallet Investor which, over 2019, argues that XRP will reach a ceiling $.05 but will not rise higher.

In comparison, DigitalCoin believes that XRP’s high price point will reach $0.62 by the final quarter of 2019. While this is something that . is agreed upon by a number of financial forecasts and analysts, there are websites out there that . provide a far more optimistic view of XRP. Examples of this include Express.co.uk and FXStreet, both of which believe that XRP will reach high points of $3-5 over the course of 2019.

So with a wide range of forecasts being provided by investors in the crypto space, who are users supposed to believe in this situation? And why exactly is there such a disparity between subjective and more unbiased forecasts?

Practical application of these forecasts often demonstrates that basing a strategy on any of them wholeheartedly doesn’t work out well. As a result of this, users should ensure that they take the metaphorical helm of their investments, making use of a range of analytics as well as personal knowledge and experience.

So, What Do Experts Say About the Matter?

One of the things that really spiked the ambitions of speculators and investors over the course of 2018 was the introduction of the new xRapid system (which is now rebranded to ODL or On-Demand Liquidity). It was so well recieved and generally anticipated that investors honestly believed that XRP could surge upward to $500 with its release.

While this breakout was hoped for, the great breakout never came to fruition for XRP and its supporters – XRP, like many others, was kept in value-based check due to the dramatic bearish downturn which enveloped the crypto market in its entirety.

Regardless of the bearish downtrend, the CEO of Ripple, Brad Garlinghouse made it clear of his optimism regarding xRapid during one of his interviews:

“I’ve publicly stated that by the end of this year I have confidence that major banks will use xRapid as a liquidity tool, this calendar year. By the end of next year [2019], I would certainly hope we would see in the order of magnitude of dozens.”

There are a number of experts out there that certainly share these sentiments, believing that Ripple has some serious potential. They come out with the following opinions:

Expert	Their Take
Pinnacle Brilliance Systems: Roman Guelfi-Gibbs	“Ripple has more potential to make a jump in 2019. As the market implement more projects based on Ripple, it will outperform Ethereum. In 2018, it was too early for Ripple to reign, now is the right time.”
Shidan Gouran (Global Blockchain Technologies):	“Ripple wasn’t likely to outperform Bitcoin and Ethereum due to three reasons. First, is its low market cap. Second, Ripple isn’t suited for everyday purchases. Thirdly, Ripple isn’t bought with fiat money – ETH or BTC is required for that. Thus, the demand for ETH and BTC will only continue growing.”
John-Paul McCaffrey (Long Island University):	“Even though there’s no fiat exchange for Ripple, that might change soon.”
Samson Williams ( SeedUps):	“Ripple is the product of banks, and we will witness its bump after the 2018 recession.”

While these are optimistic about the potential of Ripple, with each of them believing that the chain has the ability to truly take the market by storm. But each of these experts stop short of providing a precise prediction when it comes to price.

What is Going to Drive Ripple’s Growth in 2020?

What is it that really demonstrates the kind of success that Ripple has undergone since it begun? The best answer to this is the fact that the number of exchanges that insist on listing it acts to demonstrate this.

It was only recently that Ripple was under accusations of paying its way onto the Coinbase marketplace, with representatives from Ripple Labs categorically denying the fact. 2018 was a busy enough year for XRP, as it managed to surge forward by 200 percent, thanks in large part to the collective efforts of both creators on the platform as well as its dedicated community.

So with 2019 coming to an end and 2020 around the corner, what is the likelihood of this surge happening here? And what exactly will help to boost the price of Ripple over this time?

• Compared to any of the years that have preceded the world of cryptocurrency, 2019 is poised to be a truly watershed year for mass adoption. Ripple CEO, Brad Garlinghouse has argued that this mass adoption wave will provide the conditions for a profound upswing for the crypto asset market, with the number of exchanges that currently host XRP looking set to increase over time.BitTrue, for example, was one of the more recent crypto exchanges that have since added Ripple to its market. Along with Bitrue, Kraken has since announced the trading pair of XRP and Bitcoin Cash (BCH). With new trading pairs making for some good news for its ecosystem as a whole.
• There’s a growing level of interest from banks and financial institutions. And it’s this interest that serves as a powerful driving force for Ripple and its future success. There are an increasing number of banks based in Japan that are interested in working with Ripple in the future, and the attention that it is getting thanks to the effectiveness of xRapid will continue to grow.  This snowballing rate of interest is likely to push XRP’s value upwards.
• Along with this growing level of interest, Ripple is obtaining a far greater amount of trust. According to a number of surveys from late 2018 demonstrates that traders have little in the way of doubt that XRP has all the potential to provide major returns to investors over the course of 2019.Even with a market cap which is far smaller than its more influential rivals such as Bitcoin and Ethereum, Ripple is more likely, and better placed to deliver some spectacular returns over this year, largely because of its real use case as well as growing popularity based on this real-world applications.
• There are a far greater number of partnerships which are just around the corner for Ripple. And this interest in collaborating with Ripple isn’t just coming from international banks and financial institutions. R3 and its Corda Network intend to partner up with Ripple and make use of XRP for its Network.In total, this brings the total number of partnerships that Ripple has secured up to a grand total of over 280. And among these, there are a number of central banks that can be included in this list. SBI Holdings, which also seeks to collaborate with Ripple, as it intends to truly revolutionize the Japanese financial world over the next five years, with Ripple intending to be a major keystone in this.

Forging the RippleNet – PNG Bank Jumps Into Blockchain and Ripple

Ranked among the top ten in the banking world within the United States, PNC Bank has officially joined RippleNet. As a result of this, customers of the bank will have the ability to make use of real-time international payments thanks to Ripple’s proprietary system.

• Coming from the world of global remittances, Western Union has a particular interest in collaborating with and working in conjunction with Ripple. In doing so, this would help to drastically cut down the cost that comes with the current process of international payments and remittances.
• The diverse and increasingly evolving market of the Middle East is one that Ripple is taking a particular interest in. Among these regions, it has its sights set on the . matured and booming markets of Dubai and regions nearby and on the prosperous Gulf Coast. It’s within this region that there is a particularly ravenous demand for international payments and remittances, and Ripple is the brand that is in the best position to provide this to these regions. It has a particular niche in the market taken care of for these nations to truly benefit from.
• With a new range of products coming to the market under the broad name – RippleNet (and the new RippleNet Home), has gained a great deal of press from interested parties. These include products such as xRapid, xVia, as well as xCurrent and the InterLedger Protocol. Each of these products will allow Ripple to really put itself above and beyond any other kind of product that is out there.

There are certainly a large number of elements that will see to the continued growth of XRP over the course of 2019. With all of these factors in mind, it’s a matter of when as opposed to if on the subject of XRP’s economic growth. For as long as these plans and goals are being fulfilled in the eyes of its partners and investors, Ripple will be able to really build up momentum and begin a thunderous upward pace.

In summary, Ripple may not be winning too many supporters if they were to judge it on just how decentralized it is, or how much anonymity it provides to its users. It balances this out with an ever-growing number of institutional support and stability, including the ever-growing interest of big market players. Is there enough driving force there to substantiate its growth.

Is There an Estimation on How Much XRP Will be Worth by the end of 2019?

Along with the amount of interest that Ripple has generated among institutional investors and financial companies, there has been a greater level of speculation placed on the price that Ripple would be able to meet by the end of 2019.

There are those that go so far as to claim that XRP will be able to hit the $100 margin, if not even breaching the $500 mark in the near future of 2019, but that remains empty speculation as of yet. And there has already been more than enough discussion about the real prospects that sit just behind the real possibilities that will allow for the growth of XRP.

And while there is every hope that XRP will be able to soar beyond its humble beginnings, even breaching the $5-10 marker will be a difficult feat for XRP.

The Short Term Perspective

Over the last few months, we’ve seen the creation of two falling wedges, both of which have acted as starting points for a series of breakouts which happened shortly thereafter. The first one took approximately 260 days, and allowed for a dramatic rise of 192 percent in the underlying value of XRP; taking it from $0.26 to $0.86.

The second is currently ongoing, and has spanned a total of 150 days so far, and we can expect a breakout to take shape any time soon. For the moment, the price of Ripple has been moving sideways. Should a breakout take shape for XRP, we can either expect it to reach $0.57 or even $0.80.

While there has been a great deal of work done to truly refine and improve the performance for XRP and Ripple overall, we cannot understate the impact that the crypto market has on digital assets as a whole.

Ripple, in spite of its continued improvements, has kept a relatively static market cap of $12 billion, and with the majority of its XRP being held by the company in question, even if there was a breach in the upper supports for its value, investors cannot capitalize on this in a major way, as would be possible from other cryptos.

Can and Will Ripple be Able to Reach $10 in 2020?

There are a number of experts out there that Ripple would be able to break through the resistance levels of $.40 to $.50 which have held Ripple in a price stasis for some time. This would allow XRP to break this formerly price-oriented circle and allow it to push up to $1.

But while it’s expected that this will happen, is it something that we can expect over the course of the first quarters of 2019? These same analysts believe that it can breach these resistance points, but not by Q1 – there are few if any factors that would substantiate that kind of claim.

While this is the unfortunate reality that optimistic types will have to concede to. Once there is a greater influx of institutional investment within the Ripple ecosystem, things and fortunes may very well change for the better. Should this happen, we can expect the underlying value of XRP to reach:

• Around $1-2 during Q2 2019
• Around $3-5 during Q3 2019
• Around $5-10 during Q4 2019 (it’s an ideal scenario)

What’s Stopping Ripple From Developing Further?

We can easily list off the kinds of advantages that come with the application of Ripple. But with that said, it isn’t at a loss when it comes to disadvantages that it needs to work on redressing. Here are some of the things that may very well put off investors when it comes to Ripple:

• Ripple is a currency with a lot of centralization involved in it. It is controlled by Ripple Labs predominantly. And with approximately 61 percent of XRP’s existing volume being held by the company in question. The end result of this is that it damages the potential liquidity, with traders often taking the time to accuse Ripple of altering the market.
• At this moment in time, Ripple can’t be purchased with fiat currency at this moment in time. Traders instead, can only exchange it for another kind of cryptocurrency, with these same alternative cryptocurrencies benefiting from this factor.
• Ripple is taking a lot of time to focus itself in on institutional finance and banks. As a result, it can’t be directly used in order to conduct online purchases on an individual basis, losing it a great deal of flexibility. This lack of versatility is something  that will not help if Ripple intends to compete with cryptocurrencies that are fighting to get into the hands of individual buyers and sellers.
• At this moment in time – the cryptocurrency market is undergoing a cooling off period. And along with this, the days in which companies can raise an immense amount of money from barely substantiated ICOs and white papers have eroded into the past. As a result, we’re seeing far more skepticism from a market that has woken up from an incredibly hyped bullish trend. Traders are making more informed decisions, and are not going to stomach high risks with the promise of higher yields anymore.

At this moment in time, the cryptocurrency market needs to undergo a major overhaul, in order to really push XRP out of its lower value circle that it currently resides in.

The Bottom Line is This

Ripplers will stay rippling. The XRP army and global Ripple community are easily one of the biggest to represent a common cause of making global payments easy. From the hardcore crypto twitter crowd support of XRP to the company’s University Blockchain Research Initiative (UBRI), Ripple’s bottom line is bullish as ever for 2020 and beyond.

If any and / or all of these various predictions on the price of XRP do come true, then we may very well see Ripple break past the lower $0.25 resistance level, and maybe even beat the previous high mark price record of $3.65. This seems to be the most likely situation once Ripple managed to fully implement On-Demand Liquidity (xRapid) over the course of this year.

However, we did not focus on the XRP price or Ripple coin exchange rate value today, instead this was learning about Ripple, the company, and XRP, the cryptocurrency; and what they represent individually, collectivley and as a big part of the emerging bitcoin-led ecosystem of digital assets and virtual currencies.

The post Ripple (XRP) Guide: Live XRP/USD Price and 2020 Coin Outlook appeared first on Master The Crypto.

Tether Stablecoin Guide: How USDT Crypto Token Works

Tether (USDT) stablecoin is one of the cryptocurrency market’s biggest controversial topics in the bitcoin community. Master The Crypto put together a three-part guide for you to review to better understand Tether, how Stablecoins work and the Bitfinex association/price manipulation drama. Let’s begin:

• 1) what is Tether stablecoin (USDT)
• 2) how Stablecoins work + stablecoin comparison with Facebook Libra competition
• 3) the full story of the Tether crypto token and Bitfinex exchange, and what’s next

Live Tether Price: USDT Coin Market Cap

Tying Up Tether: Comprehensive USDT Guide and if you should get your hands on the top stablecoin!

Tether, who’s official website is at tether.to, is a stablecoin cryptocurrency by the token symbol of USDT to represent a 1:1 USD-pegged US Dollar token. As the Tether crypto slogans put it, a ‘digital money for a digital age’, with its aim to ‘bring real world currency to the blockchain’, USDT is one of the most highly-debated community topics.

The number of cryptocurrencies has exploded since the advent of Bitcoin back in 2008. With 11 years separating it from its very humble beginnings, there is now an enormous number of digital assets within the market. These different currencies either set themselves apart with unique functions or simply seek to capitalize on the success of these virtual currencies.

While these different assets provide intrinsic value to their multitudes of users and investors, another ‘genre’ of digital currency has managed to grow at an impressive rate too. Being backed by a sovereign currency, Stablecoins have emerged over the past few years as an almost extension to popularly known currencies like the US Dollar, as one example.

It should be said, these stablecoins haven’t exactly managed to explode in the same way as digital assets, but there are some pretty interesting iterations out there that are worth considering. One of these, of course, is Tether (USDT) which is one of the more popularly used stablecoins among those interested in using, holding or even loaning it out. And no matter where you check the price of Tether, whether CoinMarketCap, CryptoCompare or CoinGecko to name a few, you will see USDT in the top 10 if not top 5 by market cap and an alternating trading volume rank with Bitcoin for #1 and #2 for most in the blockchain-based token ecosystem.

But how exactly did Tether get started? What’s the underlying logic behind using it? And how exactly are you supposed to get a hold of it? We’re going to be diving into these questions right here and right now.

Quick Context – About Stablecoins

One of the interesting things about Stablecoins is that they’re not as ‘recent’ as we’d like to think; in fact, some of the first versions of these currencies actually pre-date what we know as being some of the biggest coins in the crypto world.

For example, some of the first stablecoins out there was introduced to the community back in 2014, including Tether which was first released in July 2014 under the name ‘RealCoin’. Also included were BitShares (BitUSD) and Nu (NuBits) which were able to provide users with a liquid virtual asset with a fixed price thanks to the fact that it held a reserve of US Dollars which operated as a kind of crypto collateral.

To simply say  ‘crypto collateral’ is to deeply simplify the often complicated system of liquidity that some of these stablecoins have, which can range from a singular reserve of US Dollars, to a mixed range of holdings from US Dollars, to crypto-assets like Pooled Ethereum.

Regardless, stablecoins provide their own unique take on a stable economic system. And the same is true of Tether, which we’ll be diving into now.

Tearing into Tether – An Origin

Tether is interestingly what we would describe as a brainchild of a number of the senior management team behind the cryptocurrency exchange – Bitfinex. While we know this now, the actual management team remained hidden from the general public when it was first introduced back in 2014, having started off as ‘RealCoin’ before being re-branded as ‘Tether’ in November of the same year.

So what exactly is Tether? According to its white paper, Tether operates as a kind of stablecoin that gives users the ability to use the US Dollar on both the Ethereum and Bitcoin blockchains.

“A digital token backed by fiat currency provides individuals and organizations with a robust and decentralized method of exchanging value while using a familiar accounting unit. The innovation of blockchains is an auditable and cryptographically secured global ledger.

Asset-backed token issuers and other market participants can take advantage of blockchain technology, along with embedded consensus systems, to transact in familiar, less volatile currencies and assets.

In order to maintain accountability and to ensure stability in exchange price, we propose a method to maintain a one-to-one reserve ratio between a cryptocurrency token, called tethers, and its associated realworld asset, fiat currency. This method uses the Bitcoin blockchain, proof of reserves, and other audit methods to prove that issued tokens are fully backed and reserved at all times.”

One of the interesting things about Tether comes back to this easy application on both Bitcoin and Ethereum. While its contemporaries exist sometimes within their own blockchain as a self-contained system such as MakerDAO, Tether is different due to the fact that the majority of its virtual tokens exist and routinely operate on Bitcoin and Ethereum’s blockchain’s respectively; amounting to 97 percent of its token movements.

So why is this the case? It’s a popularly used token made accessible to investors and potential buyers by a variety of centralized and decentralized exchanges.

The logic behind this is pretty simple – it provides a good speculative hedge for buyers in case there’s a bearish turn in the main crypto market; for investors, it allows them to fall back to a reserve asset that won’t fluctuate in value if they chose to leave it in there. But this also allows them to easily move from one currency to another.

For cryptocurrency exchanges – the availability of Tether provides an additional layer of liquidity for their exchange, which is especially important as a smaller centralized or decentralized exchange.

What makes this a little strange is the fact that it, from a financial perspective, it doesn’t make that much sense to piggyback off these two blockchain protocols. By contrast, other stablecoins simply develop and launch their own database.

In doing so, they can mitigate any additional costs that may come from dealing with, for example, miners in accordance with the proof of work consensus mechanism used both by Ethereum and Bitcoin.

This 97 percent metric doesn’t really sound like much, but what gives it some really heavy impact is when we take time to consider the fact that Tether’s token, the USDT, is backed on a 1:1 ratio with the dollar. And with 2.2 billion of them in circulation, it means that Tether carries a reserve of at least the same amount.

Why use Tether?

Much as was previously described, there’s a good deal of value in having a digital currency attached (in some way) to a sovereign currency. For coin exchanges and users alike, this specifically includes having some kind of financial hedge in the crypto market.

But the same advantage goes for those companies and retailers looking to accept cryptocurrencies from potential customers. As we’ve seen from the likes of Microsoft and Expedia among others, there’s every motivation to make purchases in crypto, but there are some serious issues that come with trying to do so.

Firstly, there’s a lot of volatility that comes with trying to take payments for products in Bitcoin. Secondly, the third-party payment systems that operate to provide this solution in a more accessible way basically negates the value of taking crypto as a means of payment; so why bother?

Tether aims to bridge this divide between merchants and everyday users by offering the best of both worlds; a digital currency that can piggyback off Bitcoin or Ethereum, which is also backed by a stable(ish) sovereign currency.

For exchanges, having some kind of open door for users interested in buying cryptocurrencies to quickly translate real-world cash into the digital kind is why Tether managed to take off among exchanges as one other example.

The exchanges and companies that strive to offer Tether can actually find themselves a far larger market for those interested in investing, and this may prove advantageous in the near future.

Compared to any other kind of stablecoin, Tether is the most popular kind of token being used within the ecosystem compared to other kinds out there.

So how Does Tether Work?

Tether currently operates on top of the Omni Protocol, which is a commonly used one for those digital assets that sit on top of and use the Bitcoin blockchain. While the underlying premise of Tether (USDT) is that it operates as a digital translation of the US Dollar, it doesn’t exactly function in the same way.

Firstly, while the US Dollar, for all intents and purposes, remains relatively stable while it’s in your pocket. USDT is subject to some level of fluctuation but manages to sit back on or closely orbiting $1.

So how is it that it actually works? Hypothetically, if a user were to directly wire money to a cryptocurrency exchange like Kraken, they will be provided with the same amount in Tether. The same users can then take this amount of USDT and complete transactions for other kinds of cryptocurrencies.

While this used to be the case for all users looking to get hold of Tether, this is not longer the case, due to banking problems that the company suffered over the past few years.

So, this is how it USED to work. How does it work now? While it doesn’t get involved with these kinds of transactions anymore, it still operates on the Omni Protocol, which is a layer-2 solution.

It’s on Tether’s technical stack that we can see the new process; which is that while Tether circulates on Omni, users can obtain their own volumes of Tether through a mixture of Decentralized exchanges, and centralized ones that have managed to become an accepted issuer or custodian for the stablecoin.

For those that are interested in actually obtaining Tether, here are some of the exchanges that currently offer them:

• Kraken
• Binance
• Bithumb Global
• Poloniex
• Bittrex
• KuCoin
• Gate.io
• Bitsdaq
• BTCTurk
• UpBit
• Max Maicoin
• OmgFin
• BitoPro
• IndoDax
• CITEX
• WazirX
• Kuna Exchange
• BitSonic
• FTX
• PieXGo

Each of these exchanges currently offers Spot Trading of Tether, with others out there that provide users with Futures trading too.

Tether’s Controversies

For these first three years, no-one knew who was behind this project exactly. That was until 2017, when Tether finally and unusually published its own ‘About us’ page between the weeks of the 5th and 17th of December. With this having finally been revealed, it turned out that the major members of this project came from the Bitfinex team; specifically:

• JL van der Velde (CEO)
• Giancarlo Devasini (CFO)
• Philip Potter (CSO)
• Stuart Hoegner (general counsel)
• Matthew Tremblay (chief compliance officer)

Bitcoin Price Fixing

Now, this could be simply shrugged off as members of a passionate cryptocurrency community looking to level out the playing field for new players in their community. The problem is that there are certainly enough fingers pointing at the Bitfinex team to suggest that there’s more to it than just this.

Being the minds behind a cryptocurrency exchange, AND and easily accessible kind of stablecoin that can be put to use on said exchanges is something that is more of an actual threat than a theoretical one.

This is something that the Bitfinex team certainly acted upon, according to news sources like Bloomberg which reported on it at the time, and the United States Justice Department and its Commodities and Futures Trading Commission back in November 2018.

These concerns, pokes and prods by the CFTC and Justice Department come from the aftermath of the Bitcoin hyper-bull experienced back in 2017. There were pretty serious allegations that Bitfinex, through its direct ties to Tether, were making use of the stablecoin to support or, possibly, fueling the rally within the market in 2017.

Here’s what Bloomberg had to say about the matter during the time:

“Some traders — as well as academics — have alleged that these Tethers are used to buy Bitcoin at crucial moments when the value of the more ubiquitous digital token dips. JL van der Velde, the chief executive officer of Tether Ltd. and Bitfinex, has previously rejected such claims.”

It’s CEO also replied with the following about allegations of Tether’s use in potential price-fixing:

“Tether issuances cannot be used to prop up the price of Bitcoin or any other coin/token on Bitfinex.”

Then there was the June 25, 2018 research report “Is Bitcoin Really Un-Tethered?” by University of Texas at Austin’s Department of Finance John M. Griffin and Ohio State University’s Amin Shams that was recently updated in November 2019 making multiple claims and assumptions towards manipulating the crypto market and the bitcoin price. There is also the new report out by Carol Alexander and Michael Dakos titled, “A Critical Investigation of Cryptocurrency Data and AnalysisA Critical Investigation of Cryptocurrency Data and Analysis” that was released in May 2019.

Here is a chart outlining Tether issuance in 2017, 2018 and 2019 showing the amounts printed along with the number of times bitcoin has correlated with the USDT market cap increases (note that correlation doesn’t always equate to causation):

Much of this riddle is still playing out at the time of this Tether crypto review, but now that we have a leg in the USDT stablecoin world, let’s take a full step in and understand how stablecoins work and compare Tether to other dollar-pegged crypto coins, as well as touch on what the Facebook Libra stablecoin will do towards Tether.

Stablecoins Guide: Ultimate Stablecoin Comparison List

What is a Stablecoin? What Are the Biggest and Most Popular Stablecoins? How Do Stablecoins Work? Find Out Everything You Need to Know About Stablecoins

Stablecoins are digital tokens that peg their value to a specific asset – like the US Dollar. As the crypto industry continues to grow, we’ve seen surging demand for stablecoins.

Despite the surging demand for stablecoins, many people continue to be totally clueless about how stablecoins work. What is a stablecoin? Which stablecoins are the best and most trusted on the market? In this guide, we’re answering all your questions about stablecoins.

What is a Stablecoin?

A stablecoin is a digital token built from the ground up to have a steady value. Many stablecoins are pegged to the US Dollar simply because it is the world’s most widely-used currency. However, we’ve also seen stablecoins pegged to all types of large and small fiat currencies.

Some stablecoins aren’t pegged to any fiat currency, nor are they tied to any national economy. They use smart contracts to balance reserves, for example. The smart contract sells stablecoins when prices are high, then buys stablecoins from the market when prices are low.

Why Do We Need Stablecoins?

Stablecoins were a necessary addition to the crypto community. Stablecoins emerged for a number of important reasons. However, the two most important reasons we needed stablecoins were:

Crypto Volatility

Bitcoin and other cryptocurrencies are notoriously volatile. It’s currently difficult for businesses, merchants, or individuals to accept bitcoin because the value can fluctuate significantly on a day-to-day basis. Let’s say a dealership buys a car from Honda for $20,000, then sells that car for 2 BTC a few days later. As long as 2 BTC is equal to $20,000, the dealership is okay. If the value of BTC drops, however, then the dealership could be out thousands of dollars.

Regulatory Scrutiny of Fiat Currencies

Crypto exchanges that handle ‘real’ USD or other fiat currencies often face greater regulatory scrutiny. Because of this regulatory scrutiny, some exchanges block all fiat trading whatsoever. Fiat-pegged stablecoins allow traders to enjoy the benefits of fiat currency trading without certain regulatory hurdles.

How Do Stablecoins Work?

Today, stablecoins work in different ways to retain a stable value.

Tether, for example, is one of the best-known stablecoins on the market. It’s pegged to the USD at a ratio of 1 US Dollar Tether (USDT) to 1 USD. Tether retains its value by holding a reserve of USD assets.

Originally, Tether claimed to hold every USDT 1:1 with cash reserves. In other words, for every $1 billion of USDT on crypto markets, Tether held $1 billion in liquid cash in its bank account. That claim quickly proved to be false, and Tether now simply claims that the USDT is backed by equivalent “cash and other assets” instead of strictly cash reserves.

Some stablecoins stay stable with built-in algorithms or smart contracts. When the value of the stablecoin drops below a certain amount, the smart contract buys stablecoins from the market, driving up prices. When the value of the stablecoin rises above a certain value, the smart contract sells the stablecoin to reduce market demand.

Other stablecoins use even more complex systems involving a complex set of algorithms, buyback programs, and fiat reserves. As the stablecoin world continues to expand, we’re seeing new and novel stability mechanisms in place.

Benefits of Stablecoins

Some of the benefits of using, holding, or trading stablecoins include:

Better and Easier Mainstream Adoption of Crypto: Try walking down to Subway and telling the sandwich artist you’ll pay 0.0005 BTC for a foot long sub. Good luck. Everyone has now heard of bitcoin, but few people can immediately picture the value of bitcoin like they can picture the value of USD or other major fiat currencies.

You Don’t Pay Rent or Buy Groceries in Bitcoin: The vast majority of the world doesn’t pay rent or buy groceries in bitcoin. Unless something dramatic occurs within the next few years, this system is not going to change in the near future. As long as people pay rent, buy groceries, and manage other daily necessities in major fiat currencies, we’re going to need some type of easy fiat-to-crypto conversion mechanism.

Hedge Markets: Let’s say you’re holding bitcoin. You’re a big believer in the technology – but you also believe a market correction is coming. A smart trader would hedge her position by selling some BTC for an asset with a stable value – like a stablecoin. You sell 1 BTC for $10,000 USD worth of a stablecoin. BTC falls to $5,000 per BTC a few weeks later. Then, you sell your stablecoin back into BTC and end up with 2 BTC instead of 1. Put simply, stablecoins give traders more options and a better ability to hedge markets.

Stability: Thousands of merchants now accept bitcoin and other cryptocurrencies. However, widespread adoption of bitcoin is hindered by bitcoin’s instability. A merchant may not want to accept 1 BTC for a product today when the vendor still works in cash. When volatility is high, it’s difficult to use an asset as a currency.

Buy Stocks with Stablecoins: Some crypto markets have taken things to the next level, allowing you to hold cryptocurrencies, stablecoins, and stocks within one convenient dashboard. These marketplaces rarely let you buy stocks directly for BTC, however, and you may have to transfer money from crypto into a stablecoin first.

Legal and Regulatory Benefits: There are plenty of legal and regulatory benefits to using stablecoins. Namely, stablecoins aren’t necessarily backed by the same trading restrictions as cash reserves. It’s often easier for an exchange to use a proxy currency – like the USDT – instead of directly handling USD cash.

It’s Still Decentralized: Stablecoin critics might claim that stablecoins are just creating a different version of cash. That’s not quite true, however. Many stablecoins track the USD and other fiat currencies; other stablecoins, however, track other assets or no assets whatsoever. A good stablecoin has a decentralized governance system that appeals to crypto advocates.

Blockchain-Based Digital Tokens: Most stablecoins are blockchain-based, which is why they can be easily traded among crypto exchanges. Stablecoin traders get the best of both worlds, enjoying the security and decentralization of blockchain-based tokens along with the stability and familiarity of fiat currencies.

Types of Stablecoins

There are a number of different types of stablecoins available today. Generally, however, stablecoins fall into two broad categories, including collateralized and non-collateralized stablecoins.

Collateralized Stablecoins

Collateralized stablecoins are stablecoins backed by some asset. That asset has value, and each unit of the asset is tied to a specific amount of stablecoin. With USDT, for example, each USDT is backed 1:1 with USD cash. Each unit of Tether is fully collateralized. Other stablecoins are collateralized by cryptocurrencies – not fiat currencies.

Fiat Collateralized: Fiat collateralized stablecoins use fiat currency as collateral. Tether has USD reserves, for example, and allows traders to exchange a USDT 1:1 with a USD. This is why Tether has value. Other fiat-collateralized stablecoins work in a similar way. If there’s $1 million worth of stablecoin in circulation, then there’s $1 million in a vault backing the value of that stablecoin.

Crypto Collateralized: Some stablecoins are baked by cryptocurrency reserves. MakerDAO’s lending platform is backed by ETH, for example, and users are required to lock up 150% ETH to borrow the Dai stablecoin. Because of this, each Dai is collateralized by ETH at a minimum ratio of 150%.

Asset Collateralized: There’s a third type of collateralized stablecoin. Asset collateralized stablecoins aren’t backed by fiat currencies or cryptocurrencies; instead, they’re backed by some other type of asset. They might be backed by gold bars, for example, or stocks and other assets.

Non-Collateralized Stablecoins

Some stablecoins aren’t collateralized at all. There’s nothing specific backing the value of the stablecoin. The stablecoin’s value isn’t pegged to the USD, EUR, BTC, or any other traditional asset; instead, it’s backed by algorithms, smart contracts, or some other unique technology.

These stablecoins may be the most intriguing option available moving forward. They use advanced blockchain technologies and decentralized, automated smart contracts to enforce specific rules. Theoretically, a well-designed non-collateralized stablecoin could hold its value indefinitely regardless of broader crypto or fiat market movements.

Disadvantages of Stablecoins

Stablecoins are far from perfect. Like other emerging technologies, stablecoins have already started to show certain warts. Some stablecoins have crumbled out of the gates. Other stablecoins – even large ones like Tether – continue to face questions over their stability, legitimacy, and transparency.

Some of the disadvantages of stablecoins include:

Fiat Collateralized Stablecoins Work Just Like Banks

Why would a private company hold a reserve of $1 million USD in cash just to support the value of a stablecoin? There’s no incentive to hold this money in cash, and the company is losing money every day due to inflation. To make holding that money worthwhile, the company would have to lend out the cash or invest it.

Put simply, there’s no incentive for anyone to hold cash in a bank reserve just to support a stablecoin. Despite this seemingly obvious conclusion, companies like Tether originally claimed to be doing exactly that. Tether claimed that they held billions of dollars’ worth of USD cash held in a bank to support every USDT stablecoin in circulation. If that was true, then Tether was losing tens of thousands of dollars every day just through inflation.

Tether would alter change its tune, claiming that they hold their USD reserves in “cash and other assets”. Tether now appears to be investing its cash reserves to earn interest. Of course, investing always comes with a certain degree of risk. If Tether makes a bad investment, then the value of the USDT could plummet.

All of this adds up to a simple conclusion: certain fiat collateralized stablecoins are working just like banks. Did we really go through all of the trouble of creating blockchain and cryptocurrencies just to launch a new lending and banking system?

Aren’t We Just Re-Creating Money? What’s the Point?

Between 1879 and 1933, every USD in circulation was backed by a specific amount of gold. In 1933, however, President Franklin Delano Roosevelt took the United States off the gold standard after a series of bank failures during the Great Depression. The price of gold was raised to $35 per ounce, theoretically stabilizing the value of the USD. That price point was held until 1971, when President Nixon announced that the United States would abandon the gold standard. Since then, the US Dollar has not been pegged to the value of gold and vice versa. Critics say stablecoins are just re-creating the gold standard systems of times gone by. Some people say this is a good thing because it gives currency concrete value. Others claim it holds back economic progress.

Stablecoins Haven’t Proven Themselves in True Market Crashes

It’s easy for stablecoins to claim stability during normal market conditions. Yes, markets have gone up and down over the last two years, but we haven’t seen any type of significant crash. Stablecoins only started to become popular after crypto’s rise to $20,000 and subsequent drop to the $5,000 to $10,000 range in late 2017 and early 2018.

Will stablecoins hold their value if bitcoin shoots up to $50,000 or drops to $1,000? Will stablecoins hold their value if the USD plummets and we enter another international recession? These are all good questions that may never be answered.

A ship is safest when it’s in the harbor – but that’s not where a ship is meant to be. A stablecoin is safest in stable market conditions, but we don’t know how it will perform until it faces significant volatility.

Scams and a Lack of Transparency

There’s another problem with the stablecoin industry: it’s faced issues with scams and a lack of transparency – similar to the broader crypto market in general.

No stablecoin has faced as much criticism as Tether. Tether was founded in a haze of secrecy, with its founding team linked to various shady banks and exchanges like Bitfinex. Then, there was the controversy over Tether’s cash reserves, including how much cash Tether was really holding in its reserves.

Part of the problem of Tether was its sudden rise to popularity. All of a sudden, a small group of people had the ability to print $100 million USD out of thin air whenever they felt like it. Tether claimed this money was always backed 1:1 with real USD cash reserves, but audits were rare.

If you had the ability to print $100 million for yourself overnight, wouldn’t you take it? This is one reason why stablecoins may never work without a proper, decentralized regulation system in place.

The Best Stablecoins Are Centralized

Another problem with stablecoins is that the biggest stablecoins are often centralized. They were built by specific exchanges – like Gemini. Or, they’re fully operated and controlled by a centralized entity like Tether.

Yes, people have tried to create decentralized stablecoin systems, and many of these systems show a lot of promise. If we were able to create a decentralized currency like bitcoin that can’t be shut down or controlled by any entity, then why can’t we create a decentralized stablecoin? That’s the optimistic take – and it’s one that could come true.

Top 14 Stablecoins

There are about 20 major stablecoins bought and sold across today’s cryptocurrency exchanges. Tether, with a market capitalization of over $4 billion, is the most popular and widely-traded stablecoin by far.

Other stablecoins, however, have shown increasing promise. They continue to grow. Exchanges are supporting newer stablecoins based on their transparency and legitimacy. Generally, the community trusts companies like Gemini more than it trusts companies like Tether.

With that in mind, here are the top ten stablecoins available today.

Tether (USDT)

• $4.01 Billion Market Cap
• $18.4 Billion 24h Trading Volume (September 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by Tether

USD Coin (USDC)

• $436.28 Million Market Cap
• $172.7 Trading Volume (September 2019)
• Pegged to USD
• Fiat Collateralized

Paxos Standard Token (PAX)

• $241 Million Market Cap
• $383 Million Trading Volume (September 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by Paxos Trust Company

TrueUSD (TUSD)

• $190.94 Million Market Cap
• $637 Million Volume (September 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by TrustToken

Dai Stablecoin

• $80.05 Million Market Cap
• $4.57 Million Trading Volume (September 2019)
• Pegged to USD
• Crypto Collateralized
• Operated by MakerDAO

USDK (USDK)

• $28.45 Million Market Cap
• $40.1 Million Trading Volume (September 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by OKLink

Stasis EURS (EURS)

• $35.46 Million Market Cap
• $387,225 Trading Volume (May 2019)
• Pegged to EUR
• Fiat Collateralized
• Operated by Stasis

bitCNY (BITCNY)

• $9 Million Market Cap
• $151,000,000 Trading Volume (May 2019)
• Pegged to CNY
• Crypto Collateralized
• Operated by Unknown Company

Gemini Dollar (GUSD)

• $8.5 Million Market Cap
• $2.87 Million Trading Volume (September 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by Gemini

StableUSD (USDS)

• $6.4 Million Market Cap
• $678,000 Trading Volume (May 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by Stably

USDQ

• $5.49 Million Market Cap
• $119,000 Trading Volume (September 2019)
• Pegged to USD
• Fiat collateralized
• Operated by Platinum Securities

BitUSD (BITUSD)

• $3.87 Million Market Cap
• $650,000 Trading Volume (September 2019)
• Pegged to USD
• Crypto Collateralized
• Operated by BitShares

1SG (1SG)

• $1.3 Million Market Cap
• $3,800,000 Trading Volume (May 2019)
• Pegged to SGD
• Fiat Collateralized
• Operated by Mars Blockchain Group

sUSD (SUSD)

• $1.3 Million Market Cap
• $115,000 Trading Volume (May 2019)
• Pegged to USD
• Fiat Collateralized
• Operated by Synthetix

Other Stablecoins

The stablecoins listed above are the most popular ones on the market today. They each have a market cap over $500,000. The stablecoins listed below, meanwhile, have smaller market caps but may become more prominent in the future:

• Alchemint Standards (SDS)
• White Standard (WSD)
• NuBits (USNBT)
• Constant (CONST)
• SDUSD (SDUSD)
• USDCoin (USC)
• QUSD (QUSD)
• StableCoin (SBC)

Facebook’s Upcoming Libra Cryptocurrency is a Stablecoin

Facebook has created enormous buzz after announcing its Libra cryptocurrency. What some don’t realize, however, is that Libra is actually a stablecoin.

Facebook envisions Libra as a complement to the US Dollar. The company plans to back Libra with a basket of currencies and US Treasury securities in an attempt to avoid volatility.

Facebook will also partner with various financial services. Each partner will inject an initial $10 million USD, giving Libra full asset backing on the day it opens.

New Libra currency units will be created on demand. If there is demand for $1 million more of Libra currency units, then partners within the “Libra Association” will need to contribute another $1 million.

Libra will use a distributed ledger – a blockchain – to reconcile payments between service partners.

There’s a huge difference between Libra and a traditional cryptocurrency like bitcoin, however: Libra is not decentralized; instead, it’s a centralized blockchain run by the Libra Association, which functions as a de facto central bank. In contrast, bitcoin uses a permissionless blockchain.

Facebook’s Libra appears well on track to launch in the near future. Facebook has already established the Libra Association in Geneva Switzerland. The Libra Association has 28 founding members, including Mastercard, PayPal, Visa, Spotify, Lyft, Uber, Coinbase, Andreesen Horowitz, Union Square Ventures, eBay, and other major organizations.

Although Libra has faced some criticism for its centralization, it could easily become the world’s largest stablecoin in the very near future. Stay tuned for more information about Libra as it gets closer to launch: the first version of Libra is scheduled to launch in June 2020.

Now, for the third and final part on this tether cryptocurrency guide, let’s review the drama between Bitfinex and Tether and what it means for the price of bitcoin, cryptoasset market manipulation and what is next for Tether (USDT).

Tether and Bitfinex Crisis: Everything You Need to Know

For many people, Tether is a little hard to understand. Is it another currency? Is it supposed to serve as an alternative to the USD? What exactly does it do? To be honest, the reality is worse than the speculations.

Long story short, Tether is a scam, the likes of which have not been seen since Bernie Madoff went to jail. How is this? Well, I’ll prove it to you in this article.

Warning though: this will be a long article, so go get your cup of coffee, tea, or whatever your favorite drink is, and prepare to spend at least 10 minutes reading this (figured it’s better to give you a thorough in-depth insight into everything this is).

If you’re serious about investing in USDT, this is a must-read –so you don’t end up regretting it.

What’s Crypto Best Used For?

While blockchain has more valid and solid use cases, crypto’s best use case lies in its speculative properties. For the most part, people buy cryptos in the hopes that speculation will spike its prices, resulting in profits for the “investors”.

And to facilitate the trade of these tokens, hundreds of exchanges have sprung up all over the world. Buying crypto of your choice is often as simple as depositing some fiat currency and exchanging it for those tokens.

And because regardless of the exchange you choose, because it’s a whole ecosystem, prices are mostly the same –with the exception of fees and so on. Of course, with the crypto community being big on decentralization, the ecosystem isn’t unified, in the same way as the traditional finance system.

Its structure is very similar to Liberty Reserve –a once popular network of peer to peer exchanges around the world. Only this time, it’s different in the sense that there’s a shared ledger that helps them execute the transfer of value between entities around the globe.

That ledger is what is known as blockchain. It’s decentralized, so it’s not owned by anyone entity. However, in spite of this framework, the crypto community still has some links to traditional banking because people need to convert their fiat currencies to cryptos.

As a result, many exchanges have some sort of relationship with banks. This is why bitcoin exchanges struggle with this –they often need to comply with Know Your Customer and Anti-Money Laundering regulations.

Ironically, this goes against the very grain of cryptocurrency –a private, permissionless, trustless and regulation-free currency that’s globally acceptable. This way, there can be the transfer of money between multiple entities without the need for permission, compliance or identity.

Unfortunately, there’s little that can be done about that right now. So, the smart exchanges have adopted an approach that helps them take advantage of these regulations whilst providing their customers with the sorely needed services.

Let’s Talk About Bitfinex

One of the pioneer crypto exchanges, Bitfinex rose to prominence right after the fall of Mt. Gox –the most popular exchange at the time. Of course, this was not without its risks, which is why it became the object of hack attacks in 2016, resulting in the loss of about 120,000 bitcoins (about $70 million in cash value).

To prevent and avoid the same fate as Mt. Gox, Bitfinex, did something called a bail-in. As a result of the growing liability, they essentially created their token and offered it up as “collateral” to depositors to shore up the gap created by the stolen 120,000 bitcoins. So, customers ended up owning Bitfinex equity, thanks to the token.

These tokens were a utility token. So, people were able to trade them on the platform. And customers who wanted to, could trade in theirs for cash -1 BFX = $1USD at the time. The only problem was the company’s liquidity issues –they needed cash as quickly as possible.

Enter the Bitcoin Exchange/Wells Fargo Banking Brouhaha

At this point in Bitfinex’s operations, the company had no permanent location, even though they reportedly operated out of Hong Kong. They had multiple accounts with various banks based in Taiwan.

After the hacking incident, the primary bank –Wells Fargo- stated that they wouldn’t be clearing funds originating from and going to Bitfinex’s accounts that were domiciled with these banks. This basically crippled Bitfinex’s operations as they couldn’t execute transactions, and customers couldn’t move their funds in and out of the exchange.

As a result, they sued wells Fargo –unsuccessfully, we might add- and started utilizing a company they had, that had been quite dormant till that time. That company’s name? Tether.

Interestingly, Bitfinex had always claimed that it had no relationship whatsoever with Tether before the lawsuit. But after the lawsuit, they started using the company for their operations.

Quick Intro to Tether and How it Works

Tether is popular because of its 1:1 currency peg. So, 1USDT=$1 (or euro or GBP). So, this kind of makes it function like a stablecoin. So, unlike bitcoin and other cryptocurrencies that routinely go through price swings, Tether doesn’t –at least that’s the idea.

Bottom line, it functions like an average money market fund where you can park some of your funds without fearing significant risk. However, unlike a money market fund that’s usually backed by certain financial assets, Tether was meant to be backed by the reserve.

In other words, for every 1USDT that you buy, there’s supposedly $1 in the bank somewhere. Interestingly, Tether isn’t the only stablecoin in the market. Others have realized the potential profitability of tether and have jumped on the bandwagon, offering similar services and value.

Tether’s and other stablecoins’ USP include ease of transfer between bitcoin exchanges, safe-ish crypto harbor for parking your money when you’re not trading actively, and stability in value wherever your coins are parked.

The key thing that’s not talked about is its propensity to be used for massive money laundering activities. In fact, there are camps that believe that Tether is being used for money laundering activities.

So, it’s easy to just buy bitcoin, convert it to Tether –while bypassing the KYC process, and never worry about the value of their illegally gotten gains depreciating, no thanks to the 1:1 value peg.

Naturally, this is a very appealing notion to money laundering entities looking for a “safe space” to park their illicit gains. That, plus the fact that there’s no documentation whatsoever in the event of a hack means they cannot be traced.

However, it’s not just the fraudulent that use it. There are proponents of digital privacy, people opposed to financial regulation and compliance, tax evaders, and people who just don’t trust the government. These people make up the bulk of USDT users.

With claims of $1 reserve for every 1USDT, there’s the question of the veracity of these claims. There are strong speculations that Tether’s reserve claims are not true at all; that the firm hasn’t been in control of a significant part of its reserves.

And these folks were right. While Tether sells itself a cryptocurrency that’s backed by traditional currencies held in the reserve, court cases involving them proved that this was not the case. If anything, the bulk of their reserves originated from transactions involving known money-laundering entities such as Crypto Capital Corp and other shady entities.

So, Where Were These Funds Parked?

Between the years 2017 and 2019, avid industry watchers have asked where Tether kept the reserve it claims it has. Well, it appears that that the company largely used shell corps to move their funds around.

And some banks caught on to it, and froze their funds when they realized that the company wasn’t being straightforward with them. At the end of the day, Tether was able to finally get a bank -Puerto Rico-based Noble Bank- that was willing to take its business, and keep their funds for them.

However, this wasn’t without a few issues. For instance, the bank’s board was known to have kicked against Tether banking with them because of their relationship with known NYC-based custodial bank, BNY Mellon.

For those who don’t know BNY Mellon, this is a huge bank whose primary business involves holding assets for externally located banks in the US. So, banks with large assets that want to keep them safe, bank with them.

And as a rule, NYC Mellon has a reputation for not doing business with money launderers. So, Noble Bank’s primary worry was that NYC Mellon would dump them because of their association with Tether, effectively crippling the bank in the process.

Anyway, after they got through the initial hurdle, Noble Bank then received deposits to the tune of hundreds of millions of dollars from Tether. Naturally, that meant that their balance essentially blew up, causing some analysts to wonder how that happened in such a short period.

To cover their tracks though, Tether warned depositors against disclosing the details of the bank publicly. The goal was to avoid attracting the ire of BNY Mellon. Unfortunately, people are unpredictable, and someone ratted.

Naturally, the entire process ended up destroying Noble bank, and forced tether to look elsewhere for their banking needs. The next recipient of this reserve was Deltec Bank, which received the funds through Crypto Capital Corp.

Let’s Talk About Crypto Capital Corp

This company was a money laundering corporation with a string of crypto businesses as clients. These included Kraken, Quadriga –Canada’s largest bitcoin exchange- and Tether –their biggest client. There are also rumors that they took on Colombian drug cartels as clients.

It was able to function by locating banks with poor compliance structures and lodging the reserve in them through shell companies. Of course, when these banks found out they were being used in money laundering schemes, they close the accounts, and Crypto Capital Corp and its shell companies go elsewhere.

Of course, Tether itself denied any culpability when these issues were raised in court. They acted as though they were astounded at the Crypto Capital Corp’s MO. Whether that was true or not, was beside the point. The real point was that Tether insulated against any charges, because CCC took the fall for their actions.

Worse, CCC was working with partners, Spiral and Reggie Fowler to receive Tether’s depositors’ funds in their accounts. So, the funds didn’t even go through/to Crypto Capital Corp. It went directly to these individuals’ accounts –Reggie Fowler in particular.

So, What Impact Did This Have on Customers?

Well, customers had to follow strict instructions whenever they wanted to deposit money for Tether. First, they would have to contact Crypto Capital Corp, who would then provide them with the account details of a shell corp.

Then, they were told to send the funds with memos that would seem innocuous, and nothing related to crypto. When this is done, the customers would then have to wait until the payment is confirmed.

Once confirmed, they’ll then credit them with their Tether value. The thing about this whole scheme is even though Bitfinex claimed that it had no idea of CCC’s operations and instructions, available evidence showed that this wasn’t true. Instructions like

“[Do not share these instructions] except with your financial institution. Divulging this information could damage not just yourself and Bitfinex, but the entire digital token ecosystem. Accordingly, you are cautioned that there may be severe negative effects associated with this information becoming public.”

Were routinely sent to customers who wanted to buy Tether. This clearly showed that they knew what was happening. Unfortunately, this was the least of their problems. Further evidence showed that Reggie Fowler was actively skimming 10 percent of all deposits. This 10 percent fund was essentially how Reggie Fowler got paid for his “services”.

As usual, Bitfinex claimed ignorance of the scheme. In one of their testimonies in court, Bitfinex stated that,

“Besides a nominal fee for each deposit or withdrawal, Crypto Capital charged no fee for these services to [Bitfinex] because it was able to earn a substantial interest on the funds it held on [our] behalf in its accounts.”

However, this wasn’t true, considering that CCC never chose bankers based on their interest rates. All they were focused on were banks with lax or weak compliance. Bitfinex’s reluctance to know CCC’s workings probably resulted in their routine siphoning of 10 percent cuts.

And even if Bitfinex had been looking, this would have been difficult to notice, given tether’s continually rising balance. People who would have probably noticed would be those looking t pull out a lot of money –more than the inflows- or hackers intent on stealing.

Anyway, after banking regulators caught on to the ruse that Crypto Capital Corp had been using, they quickly froze the accounts of shell corporations linked to the company. These actions resulted in severe liquidity problems –the reason why the company couldn’t pay withdrawals.

And when word got out about their liquidity problems, withdrawals went through the roof –everyone was trying to get their funds out. The inability to transfer those funds out of CCC meant that depositors and investors couldn’t get their monies.

While the liquidity issues started in August 2018, the rumors of Tether’s insolvency didn’t start until October 2018. And the rumors were true. Long story short, the regulators froze that money and probably won’t be giving it back to Bitfinex. For those who were thinking that a repeat of the Mt. Gox settlement with the government would happen, sorry. It probably won’t.

Is there Ever a Scenario in Which Tether Had the Reserves it Claimed it Did?

Probably when they started the project. While there’s no cogent evidence that this was the case, we only have Tether’s claims to go by. Whatever the case, it appears that it may not be backed anymore by any reserve or money laundering entity.

Whenever cryptos become “hot” as Tether has become, it can be very difficult to get those entities trusting them again. It’s highly surprising that they survived the bank run. How did they do that?

They simply lied and found ways to fulfill withdrawal requests until they couldn’t anymore. Frauds are generally like this –they have a loophole that they often have to work hard at covering up.

And when they’re caught, they simply keep spinning the wheels until more suckers get on board. It’s often a highly complicated process that most people can’t fathom. They even went as far as using money mules to fulfill specific withdrawal requests:

“As explained to [New York’s] attorneys by [Bitfinex’] counsel: Bitfinex and Tether have also used a number of other third party “payment processors” to handle client withdrawal requests, including various companies owned by Bitfinex/Tether executives, as well as other “friends” of Bitfinex – meaning, human being friends of Bitfinex employees that were willing to use their bank accounts to transfer money to Bitfinex clients who had requested withdrawals”.

Other methods included using funds belonging to Bitfinex customers to settle these withdrawals. While they were doing this, they stuck to their guns that they still had sufficient reserves to back their token. As a result, they were able to stave off bankruptcy for a while… until the New York Attorney General started investigating them.

They’ve devised other means to keep assuring the government and investors that they’re fine. They went on to claim that they had both short term securities and cash that would cover about 2/3 of all tethers in circulation. According to an affidavit submitted by the company’s lawyers,

“As of the date I am signing this affidavit, Tether has cash and cash equivalents (short term securities) on hand totaling approximately $2.1 billion, representing approximately 74 percent of the current outstanding tethers.”

Why is the Crypto Community Still Supporting Tether?

Well, a key reason is maintaining the market’s status quo. The crypto market is currently at a very delicate point.

A major hit like Tether going down is likely to dissuade investor confidence, resulting in lower prices and trade volumes –unacceptable given the present state of things. Considering that the market is just rallying, it’s easy to see why the community still supports it.

This is why some folks believe that the cryptocurrency industry is a bubble.

What’s the Current State of Things at “Tether HQ”

For starters, Reggie Fowler, a key bad actor has been arrested and is currently facing the wrath of the law. Another bad actor is still at large. Company president, Ivan Manuel Molina Lee has been extradited to Poland from Greece on charges of aiding and abetting money laundering.

Oz Yosef was recently indicted in the state of New York. All of these perpetrators were with Crypto Capital Corp. Bitfinex on the other hand, insists that they didn’t actively play any role in the scam perpetrated by CCC and its multiple shell companies.

As a result, they hope that their seized funds will be returned by the banking regulators.

What’s Next for Tether (USDT) and Stablecoins?

The crypto community needs stablecoins. It is very unlikely to see stablecoins going away anytime soon. However, we expect stablecoins to continue growing and taking advantage of new technology.

In the long run, the stablecoin disadvantages listed above might disappear. That’s the optimistic take. Tether is by far the current bitcoin ‘black hole’ of what-if’s, many wondering how Tether plays out in 2019 and 2020.

The pessimistic take, of course, is that stablecoins could become new versions of what we originally tried to escape from: centralized banks and lending institutions.

Of course, we may not know how valuable stablecoins are until the next market crash in the crypto economy or global economy. Stay tuned to see what the future of stablecoins holds. More updates on Tether and the USDT stablecoin court cases, audits and news announcements will be added soon.

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