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Ripple’s Centralization Again Draws Attention, Coinmotion says 61% XRP held by Ripple Labs

Ripple is primarily a payment network which leverages the XRP token to settle payments; Ripple Labs operate all of this. XRP is the secondly ranked cryptocurrency by market capitalization. It was notably the biggest gainer in 2017 with an All-Time High Price of $3.38. XRP price chart

A recent blog post on a Finland based cryptocurrency exchange which recently added support for XRP but also cautioned the investors claiming that Ripple is a centralized virtual currency, and XRP is like equity for Ripple Labs. Coinmotion

“Even though hundreds of companies have stated in one way or another of being interested in Ripple, only little actual use is done, and most companies and institutions are still just looking on to the subject.”

The XRP Community is vast in numbers. The partnerships with likes of MasterCard, Western Union, SWIFT, Major banks and institution with a dedicated marketing effort has attracted a considerable section of cryptocurrency fans. So much so that XRP market cap by volume is more than 10% of the total $120 billion cryptocurrency market.

Ripple Doesn’t Use Blockchain Like Bitcoin, More Privatized? 

“Ripple doesn’t use blockchain in the traditional sense to secure transactions. Instead, all the transactions are confirmed and secured in a method known as HashTree, which is patented by Ripple Labs. In HashTree all the transactions and balances are combined to a single number, which servers compare to each other to reach consensus. This kind of system is faster than blockchain but far more centralized.”

The ownership of all the 100 billion XRP tokens has been a topic of debate and discussion since Ripple’s inception. After Jed McCaleb, the co-founder of Ripple left Ripple Labs, a confidential agreement regarding the division of XRP was signed. XRP has more often than not been caught in the legal tangles for ownership and eventually spending of XRP tokens. 

“Currently there are about 39% of ripple in the open markets, while 61% are kept by Ripple Labs.”

Could Ripple Accelerate the Adoption of Bitcoin? 

Ripple due to its centralized efforts with financial institutions all over the world can ease the adoption of cryptocurrency utilization. Hence, with so many wallets with the interchangeable asset class, the adoption of XRP will increase liquidity for Bitcoin and other cryptocurrencies.

“Whereas Bitcoin is mainly intended to be an un-corruptible form of Internet money, Ripple is a network of applications for companies to use.“

The report finally threw in a word of caution for all ripple investors.

“Investing in XRP is more like buying a share on a company than investing in a cryptocurrency. It is entirely unsure how Ripple will develop or be adapted – even less so than with actual cryptocurrencies and blockchain. If You are interested in buying XRP, it is highly recommended to do further research on the topic.”