Ripple, also known as XRP, is the cryptocurrency of RippleNet. It is a blockchain-based payment network that is designed to make faster and cheaper cross-boundary payments linking financial institutions. Sending payments overseas through the legacy financial system will take one to four business days and is too expensive. On the condition that someone uses XRP as a bridging currency, there’s a possibility to settle cross-boundary transactions in less than five seconds on the open-source XRP ledger blockchain at a fraction of the cost of the more traditional means.
Price of XRP
100 billion XRP coins were pre-mined (produced at the time of the ledger’s inception) by the founders in 2012. Ripple received 80 billion tokens from the founders to fund future operations and development. The remaining XRP was shared among the founders.
XRP enters circulation whenever Ripple decides to sell coins from its pre-mined hoard on the secondary market. It is unlike bitcoin and other mined cryptocurrencies where fresh units enter the market as block rewards.
In 2017, the business put 55 billion of its 80 billion XRP tokens into an escrow account, from which it could sell 1 billion tokens every month on the secondary market. Ripple did this to improve the predictability and transparency of XRP sales.
Unsold tokens will return to escrow at the end of each month and re-distributed at a later date. 32 billion XRPs were released from escrow in the last 32 months, with 26.7 billion returned.
The escrow account holds 47.1 billion XRP tokens as of October 2021.
In the three and a half years since its inception in 2012, the price of XRP has risen dramatically twice. First is in December 2013 when it increased by over 11-fold in 15 days. Then, a year later when it increased by 454 percent in 33 days.
Following that, the price of XRP remained below $0.01 until the crypto sector began to gain traction in early 2017. Between March 22, 2017, and January 8, 2018, the price of XRP went parabolic, jumping by more than 51,000 percent from under one cent to a high of $3.40, in line with bitcoin and other cryptocurrencies at the time.
XRP was unable to keep its pace beyond $3, and the price sank below $0.10 in just a few months. Until April 2021, when the overall crypto market began to climb again, the XRP price remained below that level. The price of XRP hit a year-to-date high of $1.98 that month. However, the price spike was short, and the price dropped to less than $1.