What Is Ripple (XRP)? A Complete Guide

Ripple (XRP) is a digital asset and payment protocol designed to enable fast, low-cost cross-border money transfers. The XRP Ledger (XRPL) was launched in June 2012 by David Schwartz, Jed McCaleb, and Arthur Britto, with Chris Larsen co-founding the company now known as Ripple Labs. XRP serves as the native currency of the XRPL and plays a central role in Ripple's global payments network, RippleNet.

How the XRP Ledger Works

Unlike Bitcoin and Ethereum which rely on energy-intensive proof-of-work or proof-of-stake consensus mechanisms, the XRP Ledger uses a unique Federated Consensus Protocol. Transactions are validated by a network of over 150 independent servers called validators, run by universities, exchanges, businesses, and individuals worldwide. This design allows XRP to settle transactions in 3 to 5 seconds at a cost of just 0.00001 XRP per transaction — making it one of the most efficient blockchain networks in existence. Energy studies indicate the XRP Ledger uses approximately 0.0079 kWh per transaction, vastly more efficient than proof-of-work alternatives.

XRP acts as a bridge currency between different fiat currencies and low-liquidity trading pairs, providing on-demand liquidity for international payment corridors without requiring pre-funded accounts in each destination country.

In June 2025, an EVM-compatible sidechain launched for the XRPL, enabling Solidity-based decentralized applications with gas fees payable in XRP. This development significantly expands the XRPL's addressable market by opening it up to the Ethereum developer ecosystem. XRP is not mined; its total supply of 100 billion tokens was fixed at genesis. Ripple's escrow-based release system ensures predictable supply management, which is a key feature for institutional participants who require supply certainty when allocating to digital assets.