Tag: decentralized coins

Pros and cons of investing in Ripple XRP

The Pros And Cons Of Investing In XRP Cryptocurrency

XRP or Ripple is the third largest cryptocurrency on the market and this is why many people consider investing in it. However, when considering if you should invest, you need to look beyond the position and price. You have to weigh up the pros and cons of investing in Ripple before you take any further steps.

Ripple Works And Is Ready For Adoption

One of the pros of Ripple is the fact that it runs on the Ripple xRapid protocol. Tests have found that this is a solution which is faster and cheaper than others. In fact, it takes less than 3 minutes for a transaction to be completed and will save 40% to 70% in costs. The network is also highly scalable which makes it a well-oiled currency ready for global adoption.

A goal set by Ripple is to handle up to 1500 TPS which is much faster than its competition. Ripple is also dedicated to meeting its goals and constantly testing performance.

Low Price And Stability

Ripple is stable

Another benefit of Ripple is the stability and low price. There are many who have accused Ripple of being centralized because of the way it works and the overall design. However, this is what banks and financial institutions will need in order to trust a cryptocurrency. This is also what makes it attractive to investors.

The way that Ripple works means that it is stable and this means security. Other cryptocurrencies will be highly volatile and this is a risk that you may not want to take. You can easily limit this by investing in Ripple instead.

The Partnerships The Coin Already Has

The last benefit that you should consider is the partnerships this coin has. There are a lot of investors who choose their cryptocurrency based on the trust that large firms are putting into them. After all, why you should you risk your money is they are not.

When it comes to Ripple, there are a number of major banks and financial institutions which have partnered with the coin. This will guarantee that there is a need for the coin and that it will not disappear overnight. It is also a strong indicator that when certain conditions are met, the price is likely to skyrocket.

Limited To xRapid

This is the first drawbacks that you need to know about and is linked to the partnerships that Ripple has. Banks and financial institutions are not actually keen on using cryptocurrency which affects the use of Ripple. To accommodate these big backers, Ripple is only usable on xRapid to ensure there is liquidity when needed.

This means that even with the partnerships the coin offers, there is not much impact in terms of use. When the world starts accepting cryptocurrency more, this will change, but the legislature is not there yet.

The Regulatory Controversy And Uncertainty

Another drawback that you need to be aware of is the controversy and regulatory issues surrounding this coin. There has long been a fear that the US SEC will announce that Ripple is a security. However, this seems to have gone away in the most part with Ripple sitting squarely as a cryptocurrency. The problem is that there have been many lawsuits against the coins parent company.

These lawsuits claim that the company is controlling the coin and that XRP is actually centralized. This would make it different to other coins as they are decentralized and could change the regulations that it faces. The company does deny these allegations and have won some of the court battles.

The controversy around the centralization of the coin does have a major impact if you invest. Not only will you have to worry about the regulations, the progress that the coin makes is also slowed. This means that you will have to wait longer to see any real return on your investment. This has been a similar story with the purchase of Cardano

Investing in any cryptocurrency can be a daunting task, but Ripple does seem to be fairly stable for most people. However, you need to carefully consider all the benefits and drawbacks before you make any decisions. You should also consider the fact that Ripple is a cryptocurrency and open to some of the volatility in the market that this will bring.