Key Statistics and Goals
Bitcoin was the first cryptocurrency and is still the most popular one, but Ripple is experiencing an increase in popularity. Although both are cryptocurrencies, Bitcoin and Ripple have many factors separating them, which are worthy of comparison. Bitcoin began in 2008 and Ripple was founded in 2012, and they each have a different purpose in their design.
To start off the comparison, look at some important statistics for each currency. At the time of writing, one bitcoin (BTC) was valued at $6,501.95, while one Ripple (XRP) was equal to $$0.281410 USD or 0.00004321 BTC. Bitcoin has a market cap of $122.6 billion USD, while Ripple has a market cap of $11 billion USD. This puts Ripple in the third-highest spot, while Bitcoin is the top-ranked cryptocurrency. The prices of Bitcoin and Ripple are dramatically different, but this clearly does not affect Ripple’s ability to be a crypto leader.
As mentioned, one of the major differences between the two cryptocurrencies is the main goal behind their development. Bitcoin was created to be used as a digital currency to make payments for services and goods. By contrast, Ripple was developed specifically for payment networks and banks to use for currency exchange, money transfers, and payment settlements. Essentially, the team behind Ripple wanted to make real-time direct asset transfers that would be more transparent, secure, and cheaper than the current methods.
This difference in the goals of Bitcoin and Ripple has also led to variations in how they are used. Bitcoin is used like any other currency since that is its primary goal. By contrast, the Ripple network essentially exchanges XRP for other currencies to complete transactions quickly. The Ripple network makes this possible without any intermediaries involved.
Bitcoin is a decentralized cryptocurrency and open-source. For major decisions to be made, the community must agree. No one even knows who created Bitcoin since the developer used the codename “Satoshi Nakamoto” and has not revealed their identity. The need for consensus to make major changes to Bitcoin has led to soft forks. By contrast, Ripple has a more closed internal ledger, and a private company owns it. The consensus-seeking approach that the company uses is quicker than that of Bitcoin, but it is more centralized. Ripple has an amendment system that developers use to get a consensus before changing the network.
Fees and Transaction Times
Since two of the goals of Ripple are reducing fees and transaction times, it should come as no surprise that there is a difference in these factors for Ripple and Bitcoin. Bitcoin has proven itself unable to easily scale up to meet the growing demand, which has led to transaction fees of up to $27 and an average transaction time of 70 minutes. By contrast, Ripple uses off-ledger transactions that allow for settlement within just four seconds. Additionally, the fee for a Ripple transaction is just a fraction of a cent, and the XRP paid are destroyed, which increases the value of remaining Ripple.