XRP Ledger

Last updated

XRP Ledger
Other namesXRPL [1] [2] [3] [4]
Original author(s) Jed McCaleb, Arthur Britto, David Schwartz
Initial releaseJune 2012
Stable release
2.3.0 [5] / 2 November 2024 [5]
Repository
Written in C++
Operating system Server: Linux (RHEL, CentOS, Ubuntu), Windows, macOS (development only)
Type Real-time gross settlement, currency exchange, remittance
License ISC license
Website xrpl.org

The XRP Ledger (XRPL) [1] [2] [3] [4] is a cryptocurrency platform launched in 2012. The XRPL employs the native cryptocurrency known as XRP, and supports tokens, cryptocurrency or other units of value such as frequent flyer miles or mobile minutes. [6]

Contents

History

Development of the XRP Ledger began in 2011 by engineers David Schwartz, Jed McCaleb and Arthur Britto, with a discussion initiated by McCaleb on a public discussion board. The open-source project was originally called "Ripple", the unique consensus ledger was called the Ripple Consensus Ledger, the transaction protocol was called the Ripple Transaction Protocol or RTXP and the digital asset (known as "ripples") using XRP as the three-letter currency code to follow the naming convention of BTC for Bitcoin. The "XRP Ledger Consensus Protocol" was formally established in 2012. [7] In May 2018, Ashton Kutcher gifted a charity sponsored by Ellen DeGeneres $4 million in the currency, which was noted at the time to be the "third most-valuable cryptocurrency on the market". [8]

On July 13, 2023, Judge Analisa Torres of the United States District Court for the Southern District of New York issued a decision on motions for summary judgment and stated the XRP token itself is not a security, although the manner in which it is sold could constitute the sale of a security. "XRP, as a digital token, is not in and of itself a 'contract, transaction, or scheme' that embodies the Howey requirements of an investment contract". [9]

Technical overview

The XRP Ledger operates on a consensus protocol that differs from traditional proof-of-work (PoW) and proof-of-stake (PoS) mechanisms. [7] [3] Transactions are validated by a network of independent validators who reach consensus every 3 to 5 seconds, enabling rapid transaction settlement. [7] Users rely on a trusted list of validators known as the Unique Node List (UNL). While this approach provides faster transaction validation and security, though it has led to discussions about centralization within the network.

The XRP Ledger peer-to-peer overlay network is characterized by a small-world network topology, featuring a tightly clustered structure and short paths between nodes. [10] Information systems expert Mary Lacity notes that this platform "uses much less electricity than Bitcoin—about as much electricity as it costs to run an email server". [2]

Role of Ripple Labs

As Yale economist Gary Gorton notes, "Ripple and XRPL are not the same entity". [1] Shortly after the XRPL was launched, McCaleb, Britto and Chris Larsen founded the company Open Coin in September 2012 to operate on the ledger. On September 26, 2013, OpenCoin officially changed its name to Ripple Labs, Inc. Unlike many cryptocurrencies, XRP was pre-mined, with 100 billion tokens created at inception. [7] [11] The XRPL founders gifted 80 billion XRP, the platform's native currency, to Ripple Labs. [4] Ripple Labs holds a portion of XRP and periodically releases tokens into circulation through sales, aiming to maintain market stability.

See also

Related Research Articles

Proof of work (PoW) is a form of cryptographic proof in which one party proves to others that a certain amount of a specific computational effort has been expended. Verifiers can subsequently confirm this expenditure with minimal effort on their part. The concept was first implemented in Hashcash by Moni Naor and Cynthia Dwork in 1993 as a way to deter denial-of-service attacks and other service abuses such as spam on a network by requiring some work from a service requester, usually meaning processing time by a computer. The term "proof of work" was first coined and formalized in a 1999 paper by Markus Jakobsson and Ari Juels. The concept was adapted to digital tokens by Hal Finney in 2004 through the idea of "reusable proof of work" using the 160-bit secure hash algorithm 1 (SHA-1).

Double-spending is the unauthorized production and spending of money, either digital or conventional. It represents a monetary design problem: a good money is verifiably scarce, and where a unit of value can be spent more than once, the monetary property of scarcity is challenged. As with counterfeit money, such double-spending leads to inflation by creating a new amount of copied currency that did not previously exist. Like all increasingly abundant resources, this devalues the currency relative to other monetary units or goods and diminishes user trust as well as the circulation and retention of the currency.

<span class="mw-page-title-main">Cryptocurrency</span> Digital currency not reliant on a central authority

A cryptocurrency, crypto-currency, or crypto is a digital currency designed to work through a computer network that is not reliant on any central authority, such as a government or bank, to uphold or maintain it.

<span class="mw-page-title-main">Bitcoin protocol</span> Rules that govern the functioning of Bitcoin

The bitcoin protocol is the set of rules that govern the functioning of bitcoin. Its key components and principles are: a peer-to-peer decentralized network with no central oversight; the blockchain technology, a public ledger that records all bitcoin transactions; mining and proof of work, the process to create new bitcoins and verify transactions; and cryptographic security.

Proof-of-stake (PoS) protocols are a class of consensus mechanisms for blockchains that work by selecting validators in proportion to their quantity of holdings in the associated cryptocurrency. This is done to avoid the computational cost of proof-of-work (POW) schemes. The first functioning use of PoS for cryptocurrency was Peercoin in 2012, although its scheme, on the surface, still resembled a POW.

<span class="mw-page-title-main">Ethereum</span> Open-source blockchain computing platform

Ethereum is a decentralized blockchain with smart contract functionality. Ether is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market capitalization. It is open-source software.

<span class="mw-page-title-main">Stellar (payment network)</span> Cryptocurrency

Stellar, or Stellar Lumens (XLM) is an open-source, decentralized cryptocurrency protocol for digital currency to fiat money low-cost transfers which allows cross-border transactions between any pair of currencies. The Stellar protocol is supported by a Delaware nonprofit corporation, the Stellar Development Foundation, though this organization does not enjoy 501(c)(3) tax-exempt status with the IRS.

A blockchain is a distributed ledger with growing lists of records (blocks) that are securely linked together via cryptographic hashes. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data. Since each block contains information about the previous block, they effectively form a chain, with each additional block linking to the ones before it. Consequently, blockchain transactions are irreversible in that, once they are recorded, the data in any given block cannot be altered retroactively without altering all subsequent blocks.

A decentralised application is an application that can operate autonomously, typically through the use of smart contracts, that run on a decentralized computing, blockchain or other distributed ledger system. Like traditional applications, DApps provide some function or utility to its users. However, unlike traditional applications, DApps operate without human intervention and are not owned by any one entity, rather DApps distribute tokens that represent ownership. These tokens are distributed according to a programmed algorithm to the users of the system, diluting ownership and control of the DApp. Without any one entity controlling the system, the application is therefore decentralised.

A distributed ledger is a system whereby replicated, shared, and synchronized digital data is geographically spread (distributed) across many sites, countries, or institutions. In contrast to a centralized database, a distributed ledger does not require a central administrator, and consequently does not have a single (central) point-of-failure.

<span class="mw-page-title-main">Ethereum Classic</span> Blockchain computing platform

Ethereum Classic is a blockchain-based distributed computing platform that offers smart contract (scripting) functionality. It is open source and supports a modified version of Nakamoto consensus via transaction-based state transitions executed on a public Ethereum Virtual Machine (EVM).

Jed McCaleb is an American programmer, entrepreneur, and philanthropist. He is the founder, chairman and ex-CEO of aerospace startup Vast and a co-founder and the CTO of Stellar. Prior to co-founding Stellar, McCaleb founded and served as the CTO of the company Ripple until 2013. McCaleb is also known for creating the Mt. Gox bitcoin exchange, and the peer-to-peer eDonkey and Overnet networks as well as the eDonkey2000 application.

<span class="mw-page-title-main">Cardano (blockchain platform)</span> Public blockchain platform

Cardano is a public blockchain platform. It is open-source and decentralized, with consensus achieved using proof of stake. It can facilitate peer-to-peer transactions with its internal cryptocurrency, ADA.

A cryptocurrency wallet is a device, physical medium, program or an online service which stores the public and/or private keys for cryptocurrency transactions. In addition to this basic function of storing the keys, a cryptocurrency wallet more often offers the functionality of encrypting and/or signing information. Signing can for example result in executing a smart contract, a cryptocurrency transaction, identification, or legally signing a 'document'.

<span class="mw-page-title-main">IOTA (technology)</span> Open-source distributed ledger and cryptocurrency

IOTA is an open-source distributed ledger and cryptocurrency designed for the Internet of things (IoT). It uses a directed acyclic graph to store transactions on its ledger, motivated by a potentially higher scalability over blockchain based distributed ledgers. IOTA does not use miners to validate transactions, instead, nodes that issue a new transaction on the network must approve two previous transactions. Transactions can therefore be issued without fees, facilitating microtransactions. The network currently achieves consensus through a coordinator node, operated by the IOTA Foundation. As the coordinator is a single point of failure, the network is currently centralized.

A blockchain is a shared database that records transactions between two parties in an immutable ledger. Blockchain documents and confirms pseudonymous ownership of all transactions in a verifiable and sustainable way. After a transaction is validated and cryptographically verified by other participants or nodes in the network, it is made into a "block" on the blockchain. A block contains information about the time the transaction occurred, previous transactions, and details about the transaction. Once recorded as a block, transactions are ordered chronologically and cannot be altered. This technology rose to popularity after the creation of Bitcoin, the first application of blockchain technology, which has since catalyzed other cryptocurrencies and applications.

Algorand is a proof-of-stake blockchain and cryptocurrency. Algorand's native cryptocurrency is called ALGO.

Colored Coins is an open-source protocol that allows users to represent and manipulate immutable digital resources on top of Bitcoin transactions. They are a class of methods for representing and maintaining real-world assets on the Bitcoin blockchain, which may be used to establish asset ownership. Colored coins are bitcoins with a mark on them that specifies what they may be used for. Colored coins have also been considered a precursor to NFTs.

Ripple Labs, Inc. is an American technology company which develops the Ripple payment protocol and exchange network. Originally named Opencoin and renamed in 2015, the company was founded in 2012 and is based in San Francisco, California.

References

  1. 1 2 3 Gorton, Gary (2024). The Digitalization of Money. Cambridge Scholars Publishing. pp. 94–96. ISBN   978-1-0364-0864-0.
  2. 1 2 3 Lacity, Mary C.; Lupien, Steven C. (2022). Blockchain Fundamentals for Web 3.0. Epic Books/University of Arkansas Press. p. 231–35. ISBN   9781682262252.
  3. 1 2 3 Yuguo Li (October 2024). "Exploring the Evolution, Trade-offs, and Applications of Blockchain Technology". In Yulin Wang (ed.). Proceedings of the 2024 2nd International Conference on Image, Algorithms and Artificial Intelligence (ICIAAI 2024). Advances in Computer Science Research. Vol. 115. Atlantis Press. p. 316. doi: 10.2991/978-94-6463-540-9_32 . ISBN   978-94-6463-539-3.
  4. 1 2 3 Andreou, Giannis (2024). The Ultimate Guide to Cryptocurrency. Austin Macauley Publishers. pp. 31–33. ISBN   978-9948-766-73-5.
  5. 1 2 "XRP Ledger Foundation (Official)". Github. Retrieved December 8, 2024.
  6. ↑ "Ripple Labs Banks $3.5M for Open-Source Payments System and Virtual Currency" . The Wall Street Journal Pro. Dow Jones & Company. November 12, 2013. Retrieved January 28, 2014.
  7. 1 2 3 4 Arslanian, Henri (2022). The Book of Crypto: The Complete Guide to Understanding Bitcoin, Cryptocurrencies and Digital Assets. Springer Nature. pp. 111–13. ISBN   978-3-030-97951-5.
  8. ↑ Huddleston Jr., Tom (May 24, 2018). "Ashton Kutcher gave Ellen DeGeneres $4 million in cryptocurrency for her charity — here's what you need to know about Ripple's XRP". CNBC .
  9. ↑ District court summary judgement, pdf, Securities and Exchange Commission v. Ripple Labs, Inc., 1:20-cv-10832-AT-SN (S.D.N.Y., July 13, 2023).
  10. ↑ Tumas, Vytautas; Rivera, Sean; Magoni, Damien; State, Radu (June 7, 2023). "Topology Analysis of the XRP Ledger". Proceedings of the 38th ACM/SIGAPP Symposium on Applied Computing. pp. 1277–1284. arXiv: 2205.00869 . doi:10.1145/3555776.3577611. ISBN   978-1-4503-9517-5.
  11. ↑ Kauflin, Jeff (October 13, 2014). "Is This the Next Bitcoin? There's a new digital monetary system in town". NBC News .
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.