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Do you know how to buy XRP on Coinbase?
The process is much easier than you think.
Ever since the introduction of Bitcoin, the realm of cryptocurrency has expanded much beyond to accommodate many more burgeoning tokens.
One such cryptocurrency is the XRP coin.
It is the native token of the Ripple blockchain, which, in simple terms, is a payment settlement system.
XRP has been gaining a lot of traction among traders since its price has been increasing steadily in the last couple of months.
As a result, several crypto enthusiasts have been on the lookout for ways to invest in the token.
If you are one such trader looking to invest in XRP, you have come to the right place.
In this blog, we will go over what XRP is, how it works, and how to buy XRP on Coinbase? Keep on reading!
What is Ripple?
Before we understand what XRP is or how to buy XRP on Coinbase, we must learn about Ripple, the company behind XRP.
Ripple, in basic terms, is a currency exchange blockchain that enables global transactions easily.
Unlike Bitcoin or Ethereum, which are open to the public and aim to dismantle legacy banking, Ripple aims at enhancing the current and fragmented conventional banking system.
It accomplishes this by bringing together a system of interconnected banks and payment operators through the use of a standardized protocol to connect and deliver low-cost, rapid payments all over the world.
Ripple was originally meant to replace SWIFT (a major money transfer channel) or at least, to serve as a mediation layer between large financial institutions.
Ripple acts as a trusted intermediary between two participants involved in the transaction since the system can instantly validate that the exchange was successful.
Ripple can not only allow fiat transactions but can also enable cryptocurrency transactions, including Bitcoin.
Whenever a transaction takes place through the network, the system deducts some XRP (the network’s cryptocurrency), as a transaction fee.
In comparison to the enormous fee imposed by financial institutions to initiate cross-border transfers, the fee imposed by Ripple is modest since the standard fee for transactions is 0.00001 XRP.
Even though Ripple brings competition to Bitcoin, the idea behind Ripple was birthed much before Bitcoin.
Ryan Fugger, a Canadian software developer, introduced RipplePay in 2004, as a method to give safe payment choices to participants of an online community across a worldwide network. But, it wasn’t until six years later that Ripple was fully launched.
What is XRP?
XRP is the native cryptocurrency of the XRP Ledger. The XRP token is used to facilitate transactions on the Ripple network.
Users are allowed to purchase XRP as an investment or as a cryptocurrency to swap for other cryptos, or just as a means to fund transactions on Ripple.
Interestingly, XRP’s blockchain works slightly differently from that of most other cryptocurrencies.
Other cryptocurrencies make their transaction blockchains and verification methods available to anybody who can swiftly solve difficult equations.
Transactions, however, are safe since the bulk of ledger owners must agree to the verification in order for them to be included.
Unlike Bitcoin, which happens to be decentralized and open to anyone, the XRP ledger is somewhat centralized owing to its default list of validators.
Although any user can download the validation software of the network, the system keeps separate node lists from which users can choose to validate their transactions depending on members of the network they believe are least likely to cheat them.
When new transactions arrive, the validators modify their ledgers every 3 to 5 seconds to ensure that they are consistent with the other ledgers.
In case there happens to be a mismatch, they will come to a halt to determine what possibly went wrong.
This enables the network to verify transactions safely and swiftly, giving it an advantage over competing cryptocurrencies such as Bitcoin.
Unlike traditional means of international payments (which can take between one and four business days), the XRP token can be leveraged to offer on-demand liquidity or function as a bridge currency to process cross-border payments in just five seconds and for a relatively small portion of the price of typical transfers.
Only 10 drops or 0.00001 XRP are used up to pay for transactions, which is nothing when compared to the huge amounts one has to pay for international payments through financial institutions.
Although the price of transferring XRP changes according to network connections, all associated transactions are processed and resolved on the XRP Ledger.
What’s The Difference Between Ripple and XRP?
A lot of people seem to be confused between Ripple and XRP. Hence, in this section, we will discuss the difference between the two before we go on to learn how to buy XRP on Coinbase.
Ripple is simply the company behind XRP. It is a fintech company that creates international payment products.
On the other hand, XRP is just a cryptocurrency running on the XRP ledger, which is software. However, this was not the case from the start.
The XRP ledger, which is the software behind the XRP coin, as well as the Ripple company, both have undergone several rebranding since their introduction owing to fluctuating market shifts.
For instance, Ripple was originally founded in 2012 and was named OpenCoin.
The company then rebranded itself in 2013 as Ripple Labs. Fast forward to 2015, they changed their name back to Ripple.
Similarly, the XRP ledger before being finalized with its current name had other names such as the Ripple Consensus Ledger, the Ripple Network, and the Ripple Open Payment System.
In comparison, the XRP coin was always referred to as XRP although it is noted that the cryptocurrency was sometimes referred to as “ripple credits” or “ripples” during the infancy of the XRP project.
Controversy Surrounding XRP
XRP and Ripple Labs have proved to be contentious, with the U.S. Securities and Exchange Commission (SEC) believing that the cryptocurrency was issued as an unregistered security.
This has resulted in the XRP token being the subject of a legal dispute and the SEC closely monitoring the activities of the blockchain.
Back in December 2020, the SEC put forward a legal complaint against Ripple with the allegation that Ripple dodged securities regulations.
The SEC claimed that Ripple did not register with the SEC before trading $1.3 billion worth of XRP tokens.
This allegation has resulted in several exchanges delisting the XRP coin from their platforms.
Whatever be the result of this lawsuit, it can be said with much certainty that this will have major repercussions on the crypto world and digital currencies, in general.
How to Buy XRP on Coinbase
In light of the XRP dispute, XRP trading has been temporarily blocked on Coinbase.com.
The block will remain in effect until additional notification from the U.S.
Securities and Exchange Commission (SEC) or other governmental agencies for this dispute is issued.
This implies that you will not be able to sell, purchase, or exchange your XRP coins on Coinbase. However, you will still be able to check your balance.
Moreover, you can still transfer your XRP balance to some external address and manage your assets there but you won’t be able to do the same on Coinbase, unfortunately.
The XRP team of lawyers is waging a legal battle against the SEC.
It may not be long until cryptocurrency trading services, such as Coinbase, begin listing the digital asset.
This is due to multiple minor legal triumphs and positive judgments from Sarah Netburn who is the U.S Magistrate Judge.
Will I Ever Be Able To Buy XRP on Coinbase?
The SEC is expected to approve the Ripple network payment system in the near future.
If this is the case, the XRP price will go up again as a result of a positive court verdict in Ripple’s appeal against the SEC.
If that does happen, it is likely that Coinbase will relist the digital asset.
But, there’s no need to worry because there are other alternative exchanges where you can invest in XRP.
Crypto.com, Kraken, Bitstamp, eToro, Binance, and others still offer the XRP on their platforms. For demonstration purposes, we will be showing how you can buy XRP on Binance.
Binance is presently the largest cryptocurrency exchange.
With advanced security features, an impressive interface, and affordable fees, Binance has become the go-to destination for buying cryptos for many traders.
You can purchase cryptocurrencies with either fiat currency or any other crypto. Note that exchanging XRP with some other crypto is usually preferable for many traders since it calls for less fee.
On the other hand, purchasing XRP with your debit or credit card can result in a hefty amount, which many individuals do not wish to pay.
Nonetheless, after you purchase XRP, the coins will be added to your Binance wallet. In the below section, we will be showing how you can buy XRP on the platform.
How to Buy XRP on Binance?
Follow the steps below to know how you can invest in Ripple on Binance.
Step 1: Go to the Binance website and sign in to your account.
If you do not have an account already, create one but keep in mind that you have to go through thorough verification processes before you are finally registered on the platform.
After your Binance KYC Verification Process is complete, you will be able to purchase cryptos on the platform.
Step 2: After you have signed in to your account, the next thing you need to do is go to the “Buy Crypto” section on the top.
Next, tap on “Credit/Debit Card”. Tapping on that option will take you to the Buy/Sell section.
Step 3: After that, under the Buy section, choose the fiat currency of your choice in the “Spend” tab. Similarly, in the “Receive” tab, search for XRP and select that. Next, tap on Buy.
Check the transaction fee and confirm the transaction. Voila! Your Binance account will be funded with XRP coins in no time.
Binance is your best bet when looking to invest in XRP.
Despite the fact that the Binance platform is not governed by any recognized worldwide agency, the cryptocurrency exchange conforms to the strongest security standards and demands new users to undergo the know-your-customer (KYC) procedure.
Whitelisting adds another layer of protection to the network, and customers’ crypto assets are kept in cold storage to avoid breaches.
Is XRP a Good Investment?
There is no definitive way to confirm whether or not a digital asset is a good investment.
However, XRP happens to be one of the most popular cryptocurrencies out there.
This provides the project with a solid basis and reputation that few coins can match. This has resulted in the coin receiving a lot of investor interest.
Moreover, the price of the coin has been steadily rising over the past couple of months.
However, XRP faces a difficult legal struggle. This, along with the significant unpredictability of digital currencies’ prices, may put off investors.
Nevertheless, with consecutive victories in court, it has the potential to become the primary digital currency for transactions and exchanges.
We hope our discussion on XRP was useful to you. Investing in any crypto coin requires careful consideration of the pros and cons.
Now that you know how to buy XRP on Coinbase safely, you can start investing in XRP and reap the benefits.