Ripple vs Ethereum

Bitcoin’s known the world over. It’s the number one crypto right now, but in the second and third place positions, there’s a tussle between Ripple vs Ethereum. These are newer coins with lower prices, but then every crypto had to start somewhere, and investors are interested to know which of them may be worth investing in.

Ripple Overview

The Ripple vs Ethereum debate needs an overview of each contender, so let’s look at Ripple to begin with. It was created by Ripple Labs, Inc. which specializes in offering cheap and fast cross-border money transfers.

Ripple coin is used by some of the Ripple Labs payment systems, and it’s a crypto that trades as XRP. It claims that its 1,000 times faster and cheaper to use XRP instead of Bitcoin. It’s certainly a lot cheaper than other common currency transfer services too.

More than a hundred banks are now using Ripple’s xCurrent payment settlement system, probably partly because it can handle cash transactions in nearly real-time. At the beginning of 2018, Ripple Labs announced that MoneyGram, one of the most widely used currency transfer services will including XRP as an option, with Western Union using its xRapid offering as well.

Ethereum Overview

Ethereum offers something over and above other currencies like bitcoin. The Ripple vs Ethereum comparison sees the Ether coin inching ahead here because as well as using blockchain to record transactions in, it can also use it to record “smart contracts” and run programs. This means that events that need to take place in a company’s timeline can be built into the record.

Ethereum also offers Swarm functionality, which shares data between cloud services so that user information is harder to read and won’t disappear just because one provider is compromised.

There’s a feeling with Ethereum that investors haven’t even scratched the surface of what it’s capable of yet. It may turn out to be a disruptive technology, and that’s led to a lot of excitement and interest in its potential, driving the Ripple vs Ethereum the debate too.

Ways they are similar—Ripple vs Ethereum

Ripple’s focus is on helping organizations like banks quickly transfer money around the world. Ethereum is also currency, but as we’ve seen it offers some extra value in terms of functionality too.

Ethereum’s market capitalization is sitting at around $60 billion, and Ripple’s is $26 billion. Those figures may be different, but the similarity is that they’ve both managed to increase their value by over one hundred percent over the previous year, an even result in the Ripple vs Ethereum debate.

Smart contracts benefits

Ripple can’t claim the off-the-shelf smart contracts features that Ethereum has, but a related project called “Codius” plans to bring them to all cryptocurrencies eventually. Ethereum supports smart contracts natively but perhaps in time, Codius will be the ace up Ripple’s sleeve.

Ripple vs Ethereum—Things that are different

Centralized supply with Ripple

Some debate has ensued about whether Ripple is centralized or decentralized. The answer is fairly apparent on the supply side. Ripple Labs can put out as much or as little XRP as it wants, which is certainly ‘centralized’-type behavior, but then validating Ripple transactions is going to seem comparatively decentralized as other currencies become more centralized due to mining monopolies.

Ethereum is decentralized

It’s easier to say that Ethereum is decentralized right now because no central authority monitors transaction verification or coin supply. However, as we’ve already said, mining pools are gradually eroding that sense of decentralization for this and many other cryptocurrencies.

Ethereum can be mined

Ethereum currently uses the “Proof of Work” (PoW) method that so many other cryptocurrencies use. It involves solving complex mathematical problems so that transactions can be added to the blockchain. However, Ethereum will transition to a “Proof of Stake” (PoS) approach in time that means miners must own adequate Ethereum to permit them to engage in further mining. This move from PoW to PoS will make it easier to mine Ether coin, clearing the way for smaller groups to take part, rather than just the mining monopolies that currently exist.

Ripple’s supply is fixed—but the company has plenty in escrow

Every transaction makes a small quantity of Ripple disappear, so the supply is gradually getting smaller. One hundred billion Ripple coins exist, but only 38 billion of those are actually in circulation.

Ethereum on Coinbase

The Ripple vs Ethereum debate sees Ethereum edge ahead thanks to its ease of purchase on GDAX, the Coinbase trading platform, using a debit or credit card. Ripple is also available via some less prominent exchanges, although some need you to use Bitcoin or Ethereum to make a purchase. It’s more difficult to purchase Ripple than Ethereum, but active cryptocurrency investors may not be troubled by this.

Conclusion

Ripple vs Ethereum is quite easy to settle. It’s hard to beat Ethereum because it’s easier to buy through the likes of Coinbase and also via some brokerage accounts—though this costs a lot—through Grayscale’s Ethereum Classic Investment Trust (ETCG).

Ripple is much less valuable too, worth only $0.60 to $0.70 per coin (at the time of writing) so it seems clear that in the Ripple vs Ethereum question we have to recommend Ethereum.

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