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Ripple Trading


The Ultimate Guide

Why is Everyone Talking About Ripple?

There are plenty of reasons to be excited about Ripple. Cryptocurrency has come a long way since Bitcoin burst on to the scene all the way back in 2009. Today there’s a plethora of cryptocurrencies to choose from, all with their own specific niche.

Ripple and the Ripple network have the potential to completely change the way that we approach currency transfers. Big banks and small-time traders have all begun to take notice and Ripple is one of the most successful Altcoins.

5 Incredible Ripple Facts You Might Not Know

  1. Bank of England: Conducted a proof of concept test with Ripple, integrating the company’s blockchain technology for simulated cross-border payment.
  2. Work on the Ripple payment protocol first started in 2004, (5 years before Bitcoin released) under the project name “Ripplepay”.
  3. A Ripple transaction can involve non Ripple assets such as any currency, cryptocurrency, and other digital assets such as airline miles.
  4.  American Express and Santander have partnered with Ripple for cross-border payments between the U.S. and the U.K. by using blockchain technology.
  5. Ripple Labs were involved in a lawsuit with rival platform developers R3.

Data from U.S. Equity Research estimates the cryptocurrency market is expected to grow at a 32% rate by 2023.

According to RnRMarketResearch:

“Growth is propelled by the benefits of compliance-free peer-to-peer transaction, cross-border remittance transfer, increase in use cases, volatility in the stock market, fluctuating monetary regulations in different countries, transparency, and immutability of the distributed ledger technology and benefits such as faster transaction and reduction in total ownership cost.

Ripple CEO Brad Garlinghouse discusses the company’s big bet on blockchain technology with Bloomberg’s Cory Johnson on “Bloomberg Technology.”

Brad Garlinghouse - Ripple CEO on Bloomberg
Brad Garlinghouse – Ripple CEO, via Bloomberg

“Ripple has been very focused on how do we create real utility and solve a real problem and in this case, it’s for cross-border payments, which is a multi-trillion dollar problem and if we can reduce the friction there, using blockchain technologies it would create a lot of value for consumers for banks, for the whole eco-system.”

Brad Garlinghouse – CEO Ripple

 

Chris Larsen CEO Ripple Labs on Bloomberg

Chris Larsen - CEO Ripple Labs via Bloomberg
Chris Larsen – CEO Ripple Labs via Bloomberg

“When we look at the world you see a world completely connected on an information web and that’s terrific and it makes things tremendously efficient but what we don’t have is the sense of a value web, payments, the exchange of value is still pre-internet based on 40 year old technology and so that’s very expensive, that really slows ecommerce, lots of parts of the world don’t have the ability to make payments, so this new technology that really is a 2nd gen of Bitcoin, enables now, value to be exchanged in the same way that information is currently exchanged and that’s a big deal we think.”

Chris Larsen CEO Ripple Labs

What is Ripple?

Ripple is the name for both the digital currency XRP and the open payment network within which the currency is transferred. Ripple was founded in 2012. It was designed to complement rather than compete with cryptocurrencies and fiat currencies. Ripple’s goal is to enable secure, instant and nearly free global financial transactions. it is used by many banks as the basis of their own settlement infrastructure. The currency itself, XRP, has consistently been one of the five largest cryptocurrencies by market cap.

Ripple is designed to work with the Ripple Network (RTXP). The Ripple network allows real-world assets to be transferred between two parties using a process called an issuance. For example, a bank may want to transfer a real-world asset, like gold, to another institution. To do this the bank adds the gold to the Ripple network and then transfers the asset to a “trusted party” who can reclaim the goods. This allows the trade to happen without any transaction fees.

A small amount of XRP is taken during each transaction. This isn’t to compensate traders. Instead, the Ripples are irrevocably destroyed. This prevents users from spamming the network with requests.

Put simply, Bitcoin and Ethereum are more like bank accounts. Users can trade them in exchange for goods and services. Ripples are designed to be a passageway for transactions to take place and as a bridge between other currencies. It was never really intended to be a stand-alone currency like Bitcoin and Ethereum.

Ripple vs Bitcoin

How does Ripple compare to Bitcoin? What are the key differences? See below for our head-to-head comparison:
 Ripple (XRP)Bitcoin (BTC)
PurposeCentralized enterprise blockchain solution for banks, payment providers and digital asset exchangesDecentralized digital currency
Founded20122009
FounderRyan FuggerSatoshi Nakamoto (alias)
Market CapOver $40 billionOver $250 billion
Current Price
All time High$1.35 (December 2017)$19,908 (December 2017)
All Time Low$0.0002 July 2014$0.06 (July 2010)
How long did it take to hit $100?Ripple has yet to reach $10051 months
Notable SupportersJeff Currie (Goldman Sachs)
Peter Theil (Venture capitalist)
Christine Lagarde (IMF)
Marc Andreessen (Early internet Pioneer)
Supply Cap100,000,000,00021,000,000
Initial DistributionAll XRP was instaminedMining
Mining MethodRipple is not minedASIC
Consensus MethodProof of correctnessProof of work
Network Hash Rate*N/AOver 40 BTC per hour
Difficulty increaseN/AEvery 2,016 Blocks

How are Ripples Made?

Unlike the majority of other cryptocurrencies, XRP is not “made”. Instead, it was all insta-mined during the genesis event. XRP are not really designed to be traded in the same way as Bitcoin or other cryptocurrencies.

Instead, they act as a way to protect the system from being spammed and help to convert real-world assets into issuances.

 

What is the Price of Ripple?

 

What Drives the Price of Ripple?

Major cryptocurrencies tend to rise and fall in tandem and Ripple is no exception. If you see a big rise or fall in the value of Bitcoin or Ether then expect to see Ripple follow suit. As with all other cryptocurrencies, Ripple is volatile. You should expect to see fairly dramatic fluctuations in value.

Media interest plays a big role in the price of Ripple. As cryptocurrencies hit the headlines large numbers of new traders tend to pour in. This inflates the value of cryptocurrencies across the board. This kind of rise is usually followed by a pronounced dip as early traders engage in profit-taking. You should keep a close eye on the headlines when deciding how to invest in Ripple.

Ripple, in particular, sees large boosts when it is adopted by established financial institutions. XRP saw a surge in value in May of 2017 when SBI Ripple Asia announced the creation of a Japanese Bank Consortium designed to facilitate cross-border payments. Ripple is also prone to regulation aimed at curtailing cryptocurrencies but its role as a bridging currency provides it some protection.

You should also keep an eye out for changes in Asia, while China has recently become more hostile to cryptocurrency Ripple’s utilitarian nature may mean that it will be taken up by firms like Alibaba in order to facilitate faster payments. If this happens, expect to see a huge surge in the value of XRP.

The key driver of price for Ripple will always be the number of users of the RTXP network. The more support that Ripple’s open network gains the more value your Ripple investment will take on.

What is the Price Outlook for Ripple, and What Do Experts Say on Prices?

Ripple’s price outlook in the short to medium term is fairly stable, especially if you want to trade using fiat currencies. The value of Ripple to USD has broadly followed its market cap although the value of XRP to BTC has been more volatile. This makes sense as Ripple is designed as a bridging currency.

The long-term outlook for Ripple is good. While experts fret about looming regulation it is unlikely Ripple will be adversely affected. The unique utility of RTXP means that it may find allies with traditional financial institutions.

Ripple will also do well as speculation begins to subside. Currencies with a strong utility will become more valuable. Peter Smith, CEO of Blockchain, has argued that there will be a big need for “cross border transactions”. This is an area that Ripple already excels in. The future might be rocky for cryptocurrencies but Ripple is poised to do well.

Techcrunch founder,  Michael Arrington announced a crypto hedge fund in November that will be denominated in the Ripple (XRP).

Michael Arrington
Michael Arrington via Youtube

“We are launching a $100 million crypto hedge fund. The fund is denominated in XRP. It’s actually a pretty perfect platform for a hedge fund if you want to be denominated in a crypto currency I think XRP is perfect for that.”

Michael Arrington

Ripple Market Sentiment

We’ve gathered data from 75+ leading exchanges to determine the general feeling in the Ripple market. Its calculation is simple; using data from the exchanges listed below, we gather buy and sell volumes for a given time period and weight this against the total transaction volumes.

Buy/Sell Sentiments:
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List of Ripple exchanges

  1. Cryptsy
  2. BTCChina
  3. Bitstamp
  4. BTER
  5. OKCoin
  6. Coinbase
  7. Poloniex
  8. Cexio
  9. BTCE
  10. BitTrex
  11. Kraken
  12. Bitfinex
  13. Yacuna
  14. LocalBitcoins
  15. Yunbi
  16. itBit
  17. HitBTC
  18. btcXchange
  19. BTC38
  20. Coinfloor
  21. Huobi
  22. CCCAGG
  23. LakeBTC
  24. ANXBTC
  25. Bit2C
  26. Coinsetter
  27. CCEX
  28. Coinse
  29. MonetaGo
  30. Gatecoin
  31. Gemini
  32. CCEDK
  33. Cryptopia
  34. Exmo
  35. Yobit
  36. Korbit
  37. BitBay
  38. BTCMarkets
  39. Coincheck
  40. QuadrigaCX
  41. BitSquare
  42. Vaultoro
  43. MercadoBitcoin
  44. Bitso
  45. Unocoin
  46. BTCXIndia
  47. Paymium
  48. TheRockTrading
  49. bitFlyer
  50. Quoine
  51. Luno
  52. EtherDelta
  53. bitFlyerFX
  54. TuxExchange
  55. CryptoX
  56. Liqui
  57. BitMarket
  58. LiveCoin
  59. Coinone
  60. Tidex
  61. Bleutrade
  62. EthexIndia
  63. Bithumb
  64. CHBTC
  65. ViaBTC
  66. Jubi
  67. Zaif
  68. Novaexchange
  69. WavesDEX
  70. Binance
  71. Lykke
  72. Remitano
  73. Coinroom
  74. Abucoins
  75. BXinth
  76. Gateio
  77. HuobiPro
  78. OKEX

Source – CryptoCompare Public API.

3 Reasons to Invest in Ripple

  1. Full Payment System Platform
  2. B2B Focused Technology
  3. Instant Interbank Settlement

Full Payment System Platform

Unlike most cryptocurrencies, the Ripple platform is designed in such a way that it can handle the whole transaction cycle. Instead of using third-party services to convert local currency to cryptocurrency, using a third party exchange or wallet to make a transaction and then have the money converted back to a local currency on the other end, Ripple platform can conduct the full transaction on its platform which removes a lot of the confusion and counterparty risk.

B2B Focused Technology

Ripple is designed to be able to be compliant with banking security, risk and privacy requirements such as Anti-money Laundering (AML), and Know Your Customer (KYC) practices. Businesses also operate under similar requirements meaning they would not have to go out of their way and create their own compliance policies which they otherwise would be bound by if they used less compliant cryptocurrencies. This allows Ripple more scope to engage with financial services businesses and bring them into their platform.

Instant Interbank Settlement

Ripple offers instant settlements for interbank transactions. Currently, most interbank settlements, be they international or local, occur on the SWIFT network or local networks that operate in a similar fashion. As sophisticated as these networks are, they rely on decades-old infrastructure and best practices that cannot compete. A SWIFT payment from one bank to another relies on intermediary banks to act as middlemen along the way which adds unnecessary cost and elapsed time to each transaction that as a result can take days to clear. In contrast, a Ripple payment can clear across borders in a matter of seconds.

2 Reasons Not to Invest in Ripple

  1. News Cycle Exposure
  2. Narrow Appeal

News Cycle Exposure

Ripple Labs have ambitiously been working on providing solutions to the financial services industry since before Bitcoin was invented, and as such have not made as many inroads as expected. Ripple is still a cheap buy with a lot of upside price potential, but its price is also heavily influenced by external events. If the financial services industry decides to get behind Ripple in a big way, this would have a huge bearing on the price, but this hasn’t happened yet and the market remains volatile and hanging on the next news article that relates to its adoption.

Narrow Appeal

Most cryptocurrencies benefit from their users becoming the biggest users and advocates of their platforms – the more users that buy-in, the more the platform makes an impact on the market. On the other hand, Ripple has a much narrower and pre-defined use case which narrows its metrics for success. This means that Ripple users are more likely to feel a type of disconnect as the success of the platform is more reliant on the efforts of Ripple Labs ability to bring financial services partners on board than it is on its holder’s enthusiasm and advocacy.

How to Buy Ripple

So you’ve decided that you want to take the plunge and trade Ripple. The next step is to figure out how to acquire some XRP.

The best way to acquire Ripple is through a cryptocurrency exchange. This involves exchanging your fiat currency for XRP. Unfortunately, using an exchange can be a risky prospect. The exchange represents the first fault in your security and you are relying on them to follow best practices.If an exchange does not properly protect itself then it could risk getting hacked, putting your investment at risk. It can also be difficult to resolve disputes should a problem arise, especially if the exchange is based overseas.

The best way to buy Ripple is to first buy Bitcoin using Fiat currency through an exchange. You can then trade this BTC for XRP.

There are two main ways to buy Ripple. Which one you decide to use will largely depend upon your priorities.

Coinbase

There are a lot of different Bitcoin exchanges out there but Coinbase will suit the majority of traders. One of its most useful features is the ability to buy Bitcoin either by bank transfer or with a credit/debit card. These transactions generally come with low fees. Coinbase charges 1.49% if using a bank transfer and 3.99% if using a credit or debit card. This fee rate is competitive compared to the rest of the market.

It should be noted that Coinbase requires you to provide your ID in order to trade in cryptocurrency. This helps to prevent the exchange being used for criminal activities like money laundering. It’s considered best practice and the more reputable exchanges almost always use some form of Identity verification.

Once you have acquired your Bitcoin the next step is to convert it to Ripple. One of the better exchanges to trade BTC for XRP is Kraken. Once you have signed up for an account and jumped through the verification hoops you will be able to transfer your Bitcoin to your Kraken wallet. Then you’re finally ready to trade your bitcoins for some ripples.

Kraken is a reputable exchange and you are unlikely to encounter any issues. The main advantage of trading with Kraken is that they have a large number of currency pairs. This means you will be able to trade your XRP for a variety of other altcoins and fiat currencies.

Remember that you will need to take extra steps to protect yourself when using exchanges. Always enable two-factor authorization and if possible try to avoid keeping all of your coins in a single wallet and make sure that you keep your access codes somewhere safe. If you lose them you may not be able to access your XRP.

Also, remember that you should never leave coins in your exchange wallet unless you are planning to trade them. The best way to secure your cryptocurrency is in a hardware wallet or by putting them in cold storage. This involves keeping your cryptocurrency in an offline wallet that only you have access to. Remember, you are entirely responsible for your own security. If you don’t own your wallet, you don’t own your tokens.

LocalBitcoins

You can also purchase Bitcoins through a peer to peer Bitcoin Exchange that does not require an ID. One of the best options is LocalBitcoins which allows users to buy Bitcoin with almost any currency. Once you have the Bitcoins you will then be able to trade these for Ripple at another exchange.

If you choose to use LocalBitcoins make sure that you vet users thoroughly. There is a review function provided. Some users have been known to scam new traders. If you see bad reviews it is generally best not to make the trade.

Managing your own Ripple is not easy. Not only do you have to negotiate the exchanges but you also need to take extra security measures. You need to be wary of phishing scams, viruses, and other risks. You also need to keep very careful track of your wallet’s access codes. If you lose those your Ripple investment could end up trapped in a wallet that you can’t access.

On top of this added stress are the risks you can’t control. When you use an exchange you are relying on them to protect you and your Ripple. The problem is that they sometimes fail to do this properly. 

To understand the full scale of the potential risks of using an exchange we’ll need to take a trip back to theMtGox disaster.

In 2013 MtGox controlled 70% of trading volume, making it by far the largest exchange. The problems began in March of 2013 when account seizures by FinCen prevent users from withdrawing USD from the exchange. To make matters worse MtGox was then hit by a hack that resulted in the loss of over $500 million Bitcoins.

Kolin Burges, a MtGox customer, protests at their HQ in Japan. Image source: MtGoxProtest.com

The MtGox story might be ancient history in Internet terms but it still has relevance today. One of the most popular contemporary exchanges, Bitfinex, has many of the same flaws as MtGox. In August of 2017, the exchange was hacked and the attackers made off with around $72 million worth of cryptocurrency.

The hackers found random wallets and emptied them. To offset the loss Bitfinex took the controversial decision to reduce everyone’s account balance by 37%. This meant that everyone lost something rather than have individual users lose everything.

Bitfinex was able to do this because the exchange has control over any assets stored with it. Any money and currency you have are at the mercy of the exchange. For many traders, this will be an unacceptable level of risk and you may be wondering how to get Ripple when the exchange represents such a potential fail point?

Fortunately, there is a better way to buy Ripple.

What’s the Best Way to Buy Ripple?

Our preferred option is to not buy Ripple at all and instead to trade Contracts for Difference (CFDs) using a regulated broker.

A CFD is a contract between you and the broker. Instead of buying your XRP directly you would buy a CFD and take a short or buy position. You then lose or make money depending on the direction that the market moves in. This allows you to take advantage of shifts in the market without ever owning a single XRP.

There are a lot of brokers out there and some are better than others. The first rule is to always make sure that you use a regulated broker. Regulated brokers have to comply with strict codes of conduct designed to protect you and your money. When deciding on a broker you need to take into consideration any commissions, overnight fees, and extra risk management tools. It’s also a good idea to take advantage of any free demo accounts before you commit to any one platform.

Choosing the right broker is very time consuming and can be difficult. Luckily we’re here to help. After doing our homework we have come to the conclusion that our top choice for trading in Ripple CFDs is Plus500.

Plus500 – Our Top recommendation for trading in Ripple CFDs (CFD Service. 80.6% lose money). 

Plus500 is a way to trade Ripple CFDs. Plus500 subsidiaries are individually regulated by the following agencies; Financial Conduct Authority (FCA), Cyprus Securities Exchange (CySEC), Australian Securities and Investments Commission (ASIC).  Plus500 is also authorized by the Financial Services Provider In South Africa under FSP 47546.

See the table below for exactly which regulator covers you in your country and what protection is offered.

RegulatorCountries CoveredProtection OfferedAdditional Protection Offered
Financial Conduct Authority (FCA)UK, Ireland and GermanyAll client funds are held in a segregated client bank accountFinancial Services Compensation Scheme (FSCS) may cover up to £50,000 if Plus500 fails.
Cyprus Securities Exchange (CySEC)Andorra, Argentina, Austria, Bahrain, Belgium, Bulgaria, Chile, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Gibraltar, Greece, Hungary, Iceland, Isle of Man, Israel, Italy, Kuwait, Latvia, Liechenstein, Lithuania, Luxembourg, Malaysia, Malta, Mexico, Monaco, The Netherlands, Norway, Oman, Poland, Portugal, Qatar, Romania, Saudi Arabia, Slovakia, Slovenia, Spain, South Africa, Sweden, Switzerland, United Arab Emirates and Uruguay.All client funds are held in a segregated client bank account
Australian Securities & Investments Commission (ASIC)Australia, New Zealand and South AfricaAll client funds are held in a segregated client bank account

How much does it cost to trade Ripple CFDs with Plus500?

One of the best features of Plus500 is that it doesn’t charge any commission on trades. Instead, you are only charged on the spread. A low spread can help you make the most of your Ripple CFD trades (but spreads are variable). You should be aware that there are premiums for holding a position overnight and you risk being charged an inactivity fee if you don’t use your account for 3 months.

Plus500 Cryptocurrencies
CFD Service. 80.6% lose money.

A good regulated broker will provide more than just a competitive fee structure. Plus500 offers its users a variety of tools that can help you manage your risk. For example, there’s the option to set a guaranteed ‘close at loss’ or ‘close at profit’ limit. These tools give you a great deal of control over your CFD and help to ease some of the micromanagement.

Plus500 also offer a particularly useful tool that many brokers don’t. Their users have access to a tool called a trailing stop. This allows you to set your stop position to rise with the market. If the value of Ripple increases then your stop position will rise with it. This allows you to benefit from an uptick in the market without manually monitoring and updating your stop position. It’s is an invaluable feature for busy traders who don’t have time to watch every instrument.

Plus500 is also very accessible. It is localized in 50 countries and is available in 31 different languages, so traders worldwide can feel comfortable using the platform. It also comes with a simple to use easy to understand interface. Another beneficial feature is the excellent mobile app. This app contains the same features as the desktop application. This allows users to continue trading even if they have no access to their computer or laptop.

Plus500 is our top choice for trading Ripple CFDs because it will suit traders of all levels of experience. For experienced users, it has powerful tools that can them to squeeze the most out of their trades. For newer traders, it has a simple to understand interface that can help them find their feet. The demo mode is also a welcome feature.

Any trade is a risk and Ripple is a particularly volatile commodity. When you’re considering how to buy Ripple CFDs you need to keep in mind that even if you use a safe, regulated broker like Plus500 you could still lose all of your capital if the market moves against you.

Trading in Ripple CFDs is the same as any other instrument. Make sure you follow the golden rule. Only spend what you can afford to lose. If you live by that motto and use a regulated broker to protect yourself then you are in a good position to make the most of your Ripple CFD trades.

How to Find Ripple on Plus500

how to find ripple on plus500
How to find Ripple on Plus500 – Illustrative prices only.

Example trade – not a trading recommendation!

How to trade Ripple CFDs on Plus500
Illustrative prices only.
How to close a Ripple CFD position in Plus500
Closing your Ripple CFD trade on Plus500 – Illustrative prices only.

Plus500 Summary

  • Convenient access to Ripple CFD trading
  • Easy sign-up, compared to the cumbersome process of enlisting in a cryptocurrency trading exchange
  • Guaranteed execution at a fixed price, without having to wait for another Ripple trader to agree to a buy or a sell transaction
  • Allowance of credit or debit cards, a service generally not allowed on cryptocurrency trading exchanges
  • Allowance to trade 10 or more cryptocurrency CFDs, including Bitcoin, Bitcoin Cash, Ethereum, Litecoin, and Ripple
  • Free real-time quotes and 24/7 trading availability
  • Intuitive charting tools

Any trade is a risk and Ripple is a volatile commodity. When you’re considering how to buy Ripple CFDs you need to keep in mind that even using a regulated broker like Plus500 you can still lose all your capital. If the market turns against you it is possible some, or all, of your initial capital.

Trading in Ripple CFDs is the same as any other instrument. Make sure that you follow the golden rule. Only spend what you can afford to lose. If you stick to this and use a regulated broker to protect yourself then your Ripple CFD trades will be off to a good start.

Start Trading Ripple CFDs Today

CFD Service. 80.6% lose money. 

Important: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail trader accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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