XRP (XRP)

XRP is the native cryptocurrency of the XRP Ledger (XRPL), an open-source blockchain launched in June 2012 by David Schwartz, Jed McCaleb and Arthur Britto to move value quickly and cheaply. A typical XRP transfer settles in three to five seconds and costs a tiny fraction of a cent, which is why XRP is pitched as a bridge currency for cross-border payments.

Are XRP and Ripple the same thing?

No. Ripple is a company, founded by the XRP Ledger’s creators, that sells payment software to financial institutions. The XRP Ledger is an open network that runs independently, and Ripple does not control it on its own. The two names are often used together because Ripple holds a large share of the XRP it received at launch and is one of the biggest contributors to the ecosystem.

How does the XRP Ledger work?

The XRPL uses neither Bitcoin-style mining nor Ethereum-style staking. Instead it relies on its own consensus protocol: each validator keeps a list of other validators it trusts (its Unique Node List, or UNL), and a ledger closes once a supermajority of them agree on the same set of transactions. The process uses very little energy and delivers finality within seconds. Running a validator earns no direct reward.

Unlike general-purpose smart contract platforms, the XRPL builds core financial features into the protocol itself, including a native decentralised exchange, an automated market maker (AMM) added in 2024, time-locked escrow payments and tokenised assets. Ripple’s dollar-backed stablecoin, RLUSD, has been live on the XRPL since December 2024.

What is XRP used for?

• Payments and liquidity: it acts as a bridge asset for fast conversion between two currencies.
• Network fees: a very small amount of XRP is destroyed with every transaction, protecting the network from spam.
• Account reserve: activating an XRPL account requires a small amount of XRP to stay locked in it.

What is a destination tag?

Exchanges often use a single XRP address for all their customers and use a destination tag to tell deposits apart. When you send XRP to an exchange, you need to enter this numeric tag alongside the wallet address. If you forget it, the funds will not be credited to your account automatically, and you may have to contact support to recover them.

XRP supply and escrow

All 100 billion XRP were created when the ledger launched; no new XRP is mined or issued as staking rewards. Because fees are burned, total supply actually shrinks very slowly. In 2017, Ripple placed 55 billion XRP into time-locked escrow accounts. Up to 1 billion XRP is released each month, and the unused portion is usually locked up again. Circulating supply is therefore well below total supply, and the market keeps a close eye on monthly escrow movements.

Key milestones and risks

In December 2020, the US Securities and Exchange Commission (SEC) sued Ripple, arguing that its XRP sales were unregistered securities offerings. In July 2023, a federal judge ruled that XRP sold to the public on exchanges was not a securities transaction, while Ripple’s direct sales to institutions were. The case ended in 2025 after both sides dropped their appeals. The saga showed how strongly regulatory decisions can move the XRP price.

Other risks include high volatility, concern about selling pressure from Ripple’s large holdings, and criticism that the validator list structure makes the network relatively centralised. Forgetting the destination tag or picking the wrong network are the most common user mistakes.

How to read XRP market data

XRP’s maximum supply is fixed at 100 billion, while circulating supply rises over time as XRP leaves escrow. That creates a noticeable gap between market cap and fully diluted value. Volume shows how actively XRP trades on exchanges; actual payment activity on the XRPL is tracked separately through on-chain data sources.

Official sources

• XRP Ledger: Definition and history of XRP
• XRP Ledger: Account reserves
• XRP Ledger: Source and destination tags
• XRP Ledger: Consensus protocol