xrp is based on which blockchain: Explained Simply

What Blockchain Powers XRP in Crypto?

If you’re new to digital assets, you might ask: xrp is based on which blockchain? XRP does not run on Bitcoin or Ethereum’s network. Instead, it operates on its own specialized distributed ledger called the XRP Ledger. This blockchain is tailored for rapid and low-cost global payments. Let’s break down how the XRP Ledger works, how it’s different from typical blockchains, and why it stands out in crypto finance.

Understanding the XRP Ledger

The backbone behind XRP is the XRP Ledger (XRPL). Unlike traditional blockchains (like Bitcoin or Ethereum), the XRPL uses a unique consensus mechanism developed by Ripple, the company that launched XRP.

Key features of the XRP Ledger:

• Launched in 2012 by Ripple Labs.
• Open-source and decentralized.
• Processes around 1,500 transactions per second (TPS), significantly faster than Bitcoin (7 TPS) and Ethereum (15–30 TPS).
• Transaction fees are typically a fraction of a cent.
• Finality in 3–5 seconds—ideal for quick payments.

How Does the XRPL Differ From Other Blockchains?

• Consensus Protocol: While Bitcoin uses Proof of Work and Ethereum is moving fully to Proof of Stake, the XRPL uses a unique consensus protocol. This involves a group of independent validators agreeing on the state of the ledger. No mining or staking is required.
• Centralization vs Decentralization: The XRP Ledger is often debated for its varying degree of decentralization. However, anyone can run a validator node, and Ripple controls only a minority of these nodes.
• Native Asset: XRP is the native token of the XRPL—it's used to pay transaction fees, provide liquidity, and prevent spam on the network.

Table: Comparison of Blockchain Networks

| Feature | XRP Ledger | Bitcoin | Ethereum | |-------------------|---------------|------------------|----------------| | Consensus | Unique (Ripple) | Proof of Work | Proof of Stake | | Transaction Speed | 3-5 seconds | 10+ mins | ~15 seconds | | Fees | Very low | Varies (high) | Varies (medium) | | Throughput (TPS) | ~1,500 | 7 | 15–30 |

Use Cases and Key Benefits of XRP Ledger

The XRPL was designed with efficiency in mind, especially for international payments and financial transfers. Here’s how it supports users and institutions:

Cross-Border Payments:

• Major financial institutions use the XRP Ledger for near-instant settlements, eliminating the need for traditional costly middlemen.
• RippleNet, Ripple’s enterprise blockchain network, offers global banking partners a fast and transparent way to move money, with many leveraging XRP for on-demand liquidity.

Decentralized Exchange (DEX):

• The XRPL features a built-in decentralized exchange to facilitate direct trading of issued assets or tokens.

Tokenization:

• The ledger allows anyone to issue new tokens for various purposes, such as stablecoins, reward points, and more.

Sustainability:

• Because it does not require mining, the XRPL uses minimal energy compared to proof-of-work blockchains, making it more eco-friendly.

Benefits for Beginners:

• Low fees mean users can send and receive money without worrying about high transaction costs.
• Fast transaction speeds help reduce wait times, making it great for everyday use and micro-transactions.
• Easy wallet support: Bitget Wallet and Bitget Exchange support XRP storage and trading, providing user-friendly solutions for beginners.

Recent Updates and Insights on XRP Ledger

Keeping up with blockchain innovation is crucial. The XRP Ledger community and Ripple continue to develop new features and improvements. Let’s look at the latest developments:

• Hooks Amendment: This upcoming XRPL upgrade will allow smart contracts (small, programmable contracts) to run directly on the ledger. This could power new DeFi and dApp use cases on XRPL (source: XRPL.org).
• NFT Support: The XLS-20 amendment introduced native NFT (non-fungible token) capabilities to the ledger, enabling users to mint and trade NFTs directly on XRPL.
• Tokenization Growth: According to Messari, over 7,400 assets have been issued on the XRPL as of Q2 2024, signaling strong ecosystem growth.
• Sustainability Reports: Ripple’s annual environmental impact studies (2022–2023) confirm the XRPL’s low-energy operations versus most blockchain competitors (source: Ripple.com).

Pro tip: For secure storage and smooth transactions, beginners are encouraged to use Bitget Wallet and trade XRP on Bitget Exchange, both recognized for security and ease of use.

Frequently Asked Questions About XRP’s Blockchain

How is the XRP Ledger different from a typical blockchain?
The XRP Ledger uses a consensus mechanism instead of mining or staking, which makes it faster and more energy efficient.

Can I create tokens or NFTs on XRPL?
Yes, you can. The XRPL allows users to issue their own tokens and, since 2023, supports NFTs directly.

Is the XRPL centralized because of Ripple Labs’ involvement?
No, while Ripple Labs is a major supporter, the ledger itself is open-source and run by a network of independent validators. Ripple only controls some of them, but anyone can apply to become a validator.

How can I start with XRP?
You’ll need a digital wallet like Bitget Wallet to store XRP securely and can buy or trade XRP on trusted exchanges such as Bitget Exchange.

Why do banks use the XRP Ledger?
Because of its speed, low cost, and ability to process thousands of transactions per second—ideal for cross-border payments that require efficiency and minimal delays.

Key Takeaways: Why Understanding XRPL Matters

Whether you’re investing in digital assets, making fast transfers, or exploring tokenization, knowing that xrp is based on its own blockchain—the XRP Ledger—gives you an edge. With its unique consensus, efficient ecosystem, and robust new features like NFTs and smart contracts, the XRPL stands out for speed and low cost compared to other blockchains.

Beginners and experienced users alike should consider secure platforms such as Bitget Wallet for storage and Bitget Exchange for trading to get the most out of XRP’s potential. As blockchain evolves, keeping up with developments from credible sources can help you make informed decisions for your digital journey.