Thorough comparison between Bitcoin / BTC and Ripple / XRP! What's the difference?

There are many types of virtual currencies. The most well-known currencies are Bitcoin (BTC) and Ripple.

Many people may be wondering which one to buy. Therefore, we would like to introduce the features and main differences between Bitcoin (BTC) and Ripple (XRP).

What are the main features of Bitcoin / BTC?

The main features of Bitcoin (BTC) are, for example, the following three.

1. Large market capitalization

The first is that it has a large market capitalization.

Bitcoin (BTC) is the currency with the largest market capitalization among many virtual currencies (as of January 2019).

Cryptocurrencies are traded on the 24-hour market and prices are constantly changing. The market capitalization is the product of that price and the amount of all currency issued.

A large market capitalization means that there is a lot of trading volume and prices have risen due to strong demand.

2. The first virtual currency to appear

The second is that it is the first virtual currency to appear in the world. It is said that there are more than 1,000 types of virtual currencies nowadays.

Bitcoin (BTC), which was born first among the currencies, is the originator of virtual currency. Being an ancestor is one of the reasons why Bitcoin (BTC) is so famous.

3. Point out functional problems

Third, functional problems have been pointed out.

For example, there is a concern that the block that stores the transaction history is small and can be stored when the transaction volume increases.

However, be aware that some challenges are being improved by new technologies such as Segwit and Lightning Network.

What are the main features of Ripple / XRP?

Ripple (XRP) is known as a representative of Altcoin.

What is Altcoin?

Altcoin is a virtual currency other than Bitcoin. Ripple (XRP) was invented as far back as 2004.

However, the coins were actually issued and distributed after the birth of Bitcoin (BTC).

Ripple (XRP) was developed with the aim of revitalizing the market by creating an environment that makes payments and remittances easy and inexpensive. Therefore, it is characterized by a system that specializes in improving payment and remittance functions.

Ripple exists

Another characteristic of Ripple (XRP) is the existence of Ripple, which manages currencies.

Many cryptocurrencies operate in the absence of a central administrator, but Ripple (XRP) is different. Ripple is actively promoting Ripple (XRP), and it is also characterized by the fact that it is collaborating with large companies around the world.

We are trying to revitalize the market through alliances with companies around the world, including major financial institutions.

Different developers

It is important to understand the differences when deciding whether to trade Bitcoin (BTC) or Ripple (XRP).

The first point to note is who developed it. Bitcoin (BTC) and Ripple (XRP) are invented by different people.

Bitcoin (BTC) is Satoshi Nakamoto

Bitcoin (BTC) was invented by Satoshi Nakamoto.

With the publication of a paper on Bitcoin (BTC) published under the name of Satoshi Nakamoto, cryptocurrencies, including the Bitcoin (BTC) system, have started.

Many people associate the name Satoshi Nakamoto with a Japanese man. However, in reality, it is completely unknown including nationality, gender, individual or group. In addition, Bitcoin (BTC) is a system in which an unspecified number of system participants jointly support the system, and there is no central administrator.

Ripple (XRP) is Ryan Fugger

Meanwhile, Ryan Fugger is the inventor of Ripple pay (Ripple payment protocol), a remittance system for Ripple (XRP). Unlike Satoshi Nakamoto, he is active on the front stage.

Since the purpose of development of Ripple (XRP) was to spread the easy-to-use remittance system to the world, there is also an administrator called Ripple, which is responsible for its activities. This is also a difference from Bitcoin (BTC), which has no administrator.

Different mechanisms such as consensus algorithms

Bitcoin (BTC) and Ripple (XRP) have different mechanisms as a currency system. The most significant difference is the difference in the consensus algorithm.

You can understand that the consensus algorithm is a method of transaction verification / approval. The transaction history of virtual currencies stored in blocks generated at regular time intervals is verified and approved, and then connected to the blockchain.

A blockchain is a chain of blocks in chronological order, also known as a distributed ledger.

Bitcoin (BTC) is PoW

PoW (Proof of Work) is adopted as the consensus algorithm of Bitcoin (BTC).

Simply put, it is a method that is considered to be a legitimate transaction because it has undergone a laborious verification act (mining) called calculation.

The legitimacy of transactions is ensured by the competition to quickly solve computational problems that cannot be solved without a huge amount of calculations. A huge amount of machine power is put into the calculation.

And an unspecified number of people can participate in this verification / approval act.

Ripple (XRP) is a PoC

On the other hand, the consensus algorithm of Ripple (XRP) is PoC (Proof of Consensus).

Only a limited number of people selected by Ripple will approve the transaction history of Ripple (XRP), not an unspecified number of network participants. In other words, the approval is completed with the agreement of the representative.

It can be said that it is an energy-saving type algorithm because it does not require a large amount of electricity and a huge amount of calculation unlike PoW.

Different development objectives

Bitcoin (BTC) and Ripple (XRP) have different development objectives.

Satoshi Nakamoto's treatise points out the shortcomings of fiat currencies such as the yen and the dollar, whose issuance is controlled by the central bank. The downside is the relative decline in monetary value caused by the deliberate induction of inflation by monetary easing policies.

Bitcoin (BTC) was developed with the aim of creating a currency system that does not require an issue manager, avoiding the drawbacks of having a specific manager. The result is a digital currency payment system that uses blockchain technology.

Ripple (XRP) is not so problematic when it comes to having a central administrator. Ripple (XRP) was developed with the goal of creating a low-cost, fast money transfer system.

Therefore, unlike Bitcoin (BTC), there is a central administrator. In addition, PoC is used for transaction verification and approval, so the time required to complete the remittance process is shorter than that of Bitcoin (BTC).

Performance such as remittance speed is different

There is a big difference in performance between Bitcoin (BTC) and Ripple (XRP). For example, for now, the remittance speed is faster for Ripple (XRP).

With Bitcoin (BTC), the standard time from remittance processing to transaction verification / approval is approximately 10 minutes.

On the other hand, it only takes a few seconds to complete the approval of Ripple (XRP) remittance processing. Being able to process at high speed is a great advantage of a remittance system.

Differences in remittance speed are greatly affected by differences in transaction verification / approval consensus algorithms and block speeds. Bitcoin block generation is performed at intervals of about 10 minutes, and verification and approval are also performed on a block-by-block basis.

The difficulty of the calculation problem is automatically adjusted so that the verification will be completed in about 10 minutes. As the difficulty level decreases, verification becomes easier and the reliability of the currency system decreases, so it is a specification that can not be shorter than 10 minutes.

On the other hand, Ripple (XRP) uses PoC. It is a mechanism that can be approved in a few seconds because it is a mechanism that is approved by a predetermined and reliable representative instead of being verified by an unspecified number of people.

As a result, Ripple (XRP) processes more transactions per second.

The maximum number of coins that can be issued is different.

Bitcoin (BTC) and Ripple (XRP) also have different currency issuance limits and issuance methods. The maximum currency issuance amount for Bitcoin (BTC) is 21 million BTC (currency unit).

When the issue volume reaches the upper limit, further new issuance will be stopped. On the other hand, the total issuance amount of Ripple (XRP) is 100 billion XRP (currency unit).

However, the total number of issues is not significant. Both currencies can be traded after the decimal point. The important point is that unlike fiat currencies, there is an upper limit.

There are also differences regarding currency issuance. Bitcoin (BTC) is a mechanism in which certain coins are newly issued when transaction verification and approval are performed.

As the amount of new issuance gradually decreases, the total amount of issuance will gradually approach the upper limit. On the other hand, Ripple has already issued the upper limit of 100 billion XRP from the beginning, and it is a mechanism that new issuance is not done.

Different sources such as mining

Bitcoin (BTC) and Ripple (XRP) are also available in different ways. Both cryptocurrencies are the same in that they can be purchased on exchanges and sales offices.

An exchange is a trading market set up by a virtual currency exchange company, and investors trade with each other using an auction method. You can get it if you place a buy order on the exchange and the suggested purchase price matches the market price.

The sales office will deal with the vendor. It has the advantage that it can be purchased immediately and easily with the mechanism of purchasing at the price offered by the vendor.

Both currencies are also available by receiving from someone who already owns them.

The difference in how to get it is whether you can receive the new issue by mining as a reward. The act of verifying transactions through computational competition is called mining. Mining is a term that means mineral mining.

The first person to get the correct answer to the calculation problem will receive the newly issued virtual currency as a reward for mining. Bitcoin can be obtained if mining is successful, but Ripple is a mechanism that cannot be obtained by mining because all currencies have been issued.

Prices are different

Bitcoin (BTC) and Ripple (XRP) prices are determined by supply and demand. Prices fluctuate because they are always traded on exchanges.

Bitcoin (BTC) and Ripple (XRP) are also different in their different prices. As of December 1, 2018, the Bitcoin price is about $ 4000 per BTC (BTC) and Ripple (XRP) is about $ 0.35 per 1XRP (Ripple).

However, keep in mind that higher prices do not mean higher market valuations. The value of virtual currency is expressed by market capitalization.

Market capitalization is the product of price and issued currency quantity. Therefore, it is better to consider the transaction while paying attention to the market capitalization, etc., not the absolute value of the price.

Are the price movements of Bitcoin (BTC) and Ripple (Ripple / XRP) linked?

Also, when trading cryptocurrencies, it is important to pay attention to price fluctuations. It is possible to minimize losses and make profits by determining the direction of price movements and the direction of price movements.

When analyzing the price movements of virtual currencies, it is also important to pay attention to the price movements of Bitcoin (BTC). Bitcoin (BTC) has a large trading volume and accounts for a significant proportion of the total trading volume of cryptocurrencies.

It is used as a settlement currency not only for trading with Bitcoin (BTC) and legal tender, but also for trading with Altcoin other than Bitcoin. Bitcoin (BTC) also serves as a key currency in cryptocurrencies, like the dollar in fiat currencies.

Therefore, when the Bitcoin price rises, the Altcoin price also rises, and when the Bitcoin price falls, the Altcoin price tends to fall. Bitcoin prices also affect other cryptocurrencies.

Therefore, one of the altcoins, Ripple (XRP), is also affected by the Bitcoin price. However, be aware that it is not completely linked.

Which virtual currency should I buy?

Those who are interested in both Bitcoin (BTC) and Ripple (XRP) will be wondering which one to trade. There are two points to pay attention to when deciding the transaction target, for example.

The first is the progress of Bitcoin (BTC) development and the status of updates.

The Bitcoin system has been improved by volunteer developers. If the improvement is successful, Bitcoin's reputation will increase and the price may rise.

Regarding Bitcoin (BTC), it is also good to pay attention to the trends of Bitcoin ETFs.

The second is whether Ripple's collaboration with major financial institutions and companies will be further promoted. Further expansion of partnerships with companies around the world may lead to higher prices in the future.

It is difficult to decide which currency to invest in. It is important to collect the latest information on each currency, determine the status of development and alliances, and make your own decisions.

Let's understand the difference between each virtual currency

Bitcoin (BTC), also known as the original cryptocurrency, is a popular currency with a large volume of transactions. In addition, Ripple (XRP) is also promoting cooperation with financial institutions and companies by taking advantage of its fast remittance speed, and is said to have potential.

If you're wondering whether to buy Bitcoin (BTC) or Ripple (XRP), it's important to understand the characteristics of each currency and recognize the differences. It is also a good idea to make a diversified investment in both.

In any case, it's important to keep an eye on the latest information and news about both currencies on a regular basis.

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