Today the world sends more than $155 trillion across borders. Yet, the underlying infrastructure is dated and flawed. Ripple connects banks, payment providers and digital asset exchanges via RippleNet to provide one frictionless experience to send money globally. Ripple is a real-time gross settlement system (RTGS), currency exchange and remittance network created by the Ripple company. Also called the Ripple Transaction Protocol (RTXP) or Ripple protocol, it is built upon a distributed open source internet protocol, consensus ledger and native cryptocurrency abbreviated as XRP (ripples). Released in 2012, Ripple purports to enable “secure, instantly and nearly free global financial transactions of any size with no chargebacks.” It supports tokens representing fiat currency, cryptocurrency, commodity or any other unit of value such as frequent flier miles or mobile minutes.
At its core, Ripple is based around a shared and public database or ledger, which uses a consensus process that allows for payments, exchanges and remittance in a distributed process. The network can operate without the Ripple company. Among its validators are companies, internet service providers, and the Massachusetts Institute of Technology. Used by companies such as UniCredit, UBS and Santander, Ripple has been increasingly adopted by banks and payment networks as settlement infrastructure technology, with American Banker explaining that “from banks’ perspective, distributed ledgers like the Ripple system have a number of advantages over cryptocurrencies like bitcoin.