In the recently held Money2020, Ripple was able to make ripples thanks to its astounding prospects and rich features that it has come up with. Chris Larsen, the co-founder of Open Coin Inc. which later on changed its name to Ripple Labs Inc., says that Ripple is to money as SMTP (Simple Mail Transfer Protocol) is to email.
Like Bitcoin, Ripple is a virtual currency and like Bitcoin it is mathematically defined and operates independently of nation states i.e. it is unlike any fiat that can be manipulated by the central banks. However, a major difference between Bitcoin and Ripple is that the latter’s platform is built to allow exchanges from one currency into another, with minimal friction and costs.
Now that Ripple can be used to convert any fiat, it aims to provide high-end services for the customers who want to send money to anyone, anywhere, in any currency. Earlier in an interview Chris Larsen had said that there are some fundamental reasons why the world needs Ripple, a math-based currency.
He says that with currencies like Ripple and Bitcoin, the world can move towards frictionless fast international transactions. Ripple may gain traction soon as with it customers can send money like never before, and that fast and at a lower cost, as a lot of money is wasted on payments, currency conversions, and middlemen, Ripple will provide a one-stop solution.
Ripple Will be A Powerful Currency
According to Chris Larsen there are the three things currencies need: trust, liquidity, and utility. He says that though gold is great on trust, it’s terrible on utility and customers can’t buy anything with it. He views that though existing currencies have better utility, they are weak on trust; however, Ripple has phenomenal utility and because it’s a math-based currency the corporations and central banks have been taken out of the equation.
Remittance Market Will Benefit a Lot
Remittance market is definitely going to benefit from Ripple. Currently, expats from developing economies in OECD send their money to their country and for that they have to pay a lot of money in exchange and other essentials; however, with Ripple they can send money to their native place without much trouble. Expats from India, China, Mexico, etc. will benefit a lot from Ripple.
Here customers can get paid in any currency, and receive it in their preferred currency in Market Makers, a platform that effects continuing exchanges among currency holders. This peer to peer exchange runs on trust and a process called consensus that facilitates the currency-to-currency movement.
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