Nobody wants to lose money.  

And I don't want to see people lose money;   However, the cryptomarket is still very much a wild west, where competing financial interests are motivated to obscure inconvenient facts.  

I feel frustrated for some of the new entrants to the market who do not understand the underlying technology and what makes each crypto-currency different from one another.   Why is this understanding so important?   Because the future of cryptocurrency can be predicted by looking at its brief history.

The first cryptocurrency was Bitcoin.  

Its creators were looking for a way to solve the double-spend problem.   The double-spend problem is the basic idea behind a decentralized cryptocurrency;  finding an effective way to restrict value from being 'sent more than once' by the same party.   It's the pitfall with digital money, and it's why money wasn't compatible with the Internet at first;  you typically have to trust a specific bank or credit card company to perform this service to use value online.  

Bitcoin changed that, and the way it prevented double-spend was to have massive numbers of processors (computers) compete with each other to win the rights to 'add to the chain' of historical transactions.  

Other effective, decentralized ways of preventing double-spend are now available, however, that do not require the equivalent electrical consumption of Austria just to process six transactions per second.  1  They involve 'proof-of-stake' systems and 'Consensus-based' systems.   This later approach is how the XRP Ledger prevents double-spending.  

Outrageous Energy Consumption

Proof-of-work requires massive amounts of worldwide electricity to validate just a few transactions every second.   It is not a suitable solution for prevention of double-spend, because humanity would be destroying Earth's environment just to make it work.  

In fact, multiple countries, including China, the US, and Iceland, have moved to restrict how much electricity can be purchased by those mining Bitcoin, as it is truly a blight on the electrical grid and the environment.  

Here is the visual comparison of how much electricity XRP requires to validate transactions, compared to that of Bitcoin and Ethereum, the two most popular proof-of-work cryptocurrencies:

Energy Consumption graphic

The world cannot afford to continue to support proof-of-work cryptocurrencies, and I predict that the major economic superpowers will eventually weigh in with restrictions;  the earth's environment is simply too valuable for us to continue supporting the "model T" of cryptocurrencies, along with its environmental destruction.   Especially not when much better, faster, and more scalable solutions exist at a tiny fraction of the cost.  

Poor Security

A few days ago, Coinbase, a US-based crypto on-ramp that strangely decided to list a fork of Ethereum in 2017, had to admit to its customers that the proof-of-work network had now suffered a successful 51% attack.  2

What's a 51% attack?   It's what can happen - and inevitably seems to happen - when one mining cartel or company achieves majority control over the 'hashing power' of the competition among computers.   This power allows a miner to re-write the history of the cryptocurrency, and essentially 'steal' tokens on the network.  

This has happened recently - and frequently - and Bitcoin is not immune to this danger.  3   4  5  6  7

Strangely enough, you wouldn't know it from the massive amounts of trading that still goes on for these proof-of-work networks.   And their proponents inevitably minimize the communication of this very real risk, attempting to obscure the problem using creative double-speak.

XRP, on the other hand, doesn't use incentives.  

It uses a fault-tolerant agreement protocol where individual validators are motivated to support trusted operations, and those that engage in negative behavior, such as DDOS attacks, are punished monetarily.   It has performed flawlessly since its introduction, easily repelling attempted spamming and other interference.  

Because proof-of-work cryptocurrencies must rely on incentives to properly secure their network, they are completely at the mercy of the individuals and companies mining the cryptocurrency, and the people holding the tokens must rely on hope that no successful double-spend is executed on the network.  

Do not believe proof-of-work proponents that attempt to minimize this risk.

Incentives have led to, arguably, a total loss of decentralization for proof-of-work cryptocurrencies, which is one of the things, ironically, you hear so much about from misinformed traders in the cryptomarket.   Some of them are incorrectly under the impression that Proof-of-work equals decentralization, when nothing could be further from the truth.   8

The irony is that they are more dependent on trust than those investing in proof-of-stake or Consensus-based cryptocurrencies.  

No Scalability

The performance metrics of POW networks cannot even begin to play on the same level as proof-of-stake or consensus-based systems.   Here is how that looks like visually:

scaling graphical comparison between XRP and Bitcoin

The world is not receiving any value for its collective investment in supporting proof-of-work networks.   They simply cannot process enough transactions for the network to operate as an effective back-bone for real commerce.  

While Bitcoin maximalists will point to overlay software such as Lightning, there have been numerous intractable problems with using secondary software to interact with POW networks.   Using a secondary network to scale doesn't solve the problem of using a completely inadequate base-layer technology.  

Again, you can easily contrast this with the XRP Ledger, which has a built-in scaling feature called "Payment channels" that allows it to scale with no horizontal limits.   The earliest tests that Ripple conducted easily exceeded 50,000 transactions per second.  

Infeasible Transaction Costs

Proof-of-work requires miners to secure the network.  

Those miners have to pay some very hefty power bills because of all that electricity consumption, as well as to fund the massive cost of equipment and facilities.  

To break even, many Bitcoin miners started to charge higher and higher transaction fees.   In late 2017, if you wanted a transaction to be included in the next available block, the average transaction fee spiked to an unbelievable $55 dollars.  9

That's right;   In December of 2017, you would be paying $55 as a 'transaction fee' if you wanted to use Bitcoin to buy a cup of coffee.   The fees were so embarrassingly high that the annual Bitcoin conference that year decided against using Bitcoin.   The irony was, seemingly, lost on Bitcoin maximalists.  10

Unbearably-long Settlement Times

Did you know that, even if you wait for the recommended six confirmations - sometimes taking over an hour - that your Bitcoin transaction is never completely settled with 100% probability?  11   12

This is because Bitcoin is not a deterministic protocol;  it is a probabilistic one that depends on the gradual increase in historical transaction blocks to provide enough assurance to recipients that they truly 'own' the value transferred.   For Bitcoin, the recommended number of blocks is six, and it can take up to an hour to arrive at this level of assurance.  

XRP, by contrast, is a deterministic protocol, which means that once the transaction is validated and included in a closed ledger, you have 100% assurance that the transaction will not be re-written or reversed.

Here is a visual comparison of XRP and Bitcoin settlement times:

xrp settlement speed graphical comparison with bitcoin

XRP settles payments in under four seconds.   It makes a big difference if you're standing at a cash register waiting for a transaction to clear, or are coding a check-out application for those customers that wish to pay with their crypto.  

For many crypto exchanges, this settlement speed means that using XRP as one of their base currencies makes logical sense.  

A Very Limited Future for Proof-of-Work

When I first researched cryptocurrencies and read the Satoshi Nakamoto whitepaper, my very first internal comment was "We can do better."

I knew almost instinctively that the proof-of-work model, while a convenient initial solution to double-spend prevention, was a major example of how 'first mover' technology should be adjusted and innovated upon prior to its widespread adoption.  

However, what I've learned since then, is that there is enormous resistance to change if enough people are financially rewarded to support an obsolete technology.  

Which is exactly what's happened, for far too long.  

Large investors, and early Bitcoin advocates, have been trying to maximize their Bitcoin and other proof-of-work holdings any way they can, and suppression of facts around new, better technology like XRP is part-and-parcel of their protectionist strategy.  

It's time that we get the truth out, for the sake of bringing the cryptomarket forward, and for championing the actual commercial use of digital assets in 2019 and beyond.   The world needs to turn its back on proof-of-work as a fascinating historical footnote in the creation of truly effective, modern cryptocurrencies.  

Ripple News

The big news was announced formally by Ripple via their Insights blog on January 8th:  Ripple announced that they'd officially surpassed 200 RippleNet customers worldwide, adding some interesting new members to the list:  13

  • Euro Exim Bank
  • SendFriend
  • JNFX
  • FTCS
  • Ahli Bank of Kuwait
  • Transpaygo
  • BFC Bahrain
  • ConnectPay
  • GMT
  • WorldCom Finance
  • Olympia Trust Company
  • Pontual/USEND and Rendimento

Some of these, such as 'SendFriend', we'd already figured out on our own, due to the company's own announcements or communications.   Ripple's official announcement contained some interesting items that we didn't previously know about, however.   The biggest news is that five of these twelve new customers will use XRP to move value.  

Five new xRapid customers were announced all in one shot.  

The news sent reverberations throughout the cryptomarket, and started a rally for XRP that was only cut short by organized Bitcoin dumping on January 10th.   The speculative market has shown an ability to recognize real utility, but has also been spoiled by the steady stream of adoption news for XRP, and may not completely understand how significant this latest announcement is when compared to any other news of cryptocurrency adoption.  

The one bank in the mix of new xRapid customers is Euro Exim Bank.  

Euro Exim Bank is headquartered in St Lucia, and has a branch office in the UK.   They are a relatively small bank specializing in corporate services, according to their own website:  14   15

"We cater to a range of trade finance instruments such as Instant Letters of Credit, Corporate Bank Accounts (Prestige Plus), Letters of Credit, Stand-By Letters of Credit, International Wire Transfers, Bank Guarantees, Pre-paid Master Cards and Trade Credit Lines."

The interesting thing to note is that, given their support of XRP, all they'd have to do is open retail services and watch as the list of new retail customers pour in.   As it is, I'd advise people in the United States to use Catalyst Federal Credit Union once we've verified a measurable amount of trading volume from that institution.  

The XRP Community is so large and vocal at this point, that the first bank to champion XRP will reap the early-adopter reward of additional numbers of customers;  how many that will amount to is pure speculation, but the XRP Community has consistently proven that they are the fastest-growing crypto community on social media.  

Ripple's official announcement also provided a new quote by Brad Garlinghouse about the use of XRP for transferring value:  16

“In 2018, nearly 100 financial institutions joined RippleNet, and we’re now signing two—sometimes three—new customers per week.  

We also saw a 350 percent increase last year in customers sending live payments, and we’re beginning to see more customers flip the switch and leverage XRP for on-demand liquidity,”

The announcement by Ripple of the breaking of the 200 customer mark was a major milestone, along with their announcement of five new xRapid customers.  

My confidence in XRP as 2019 rolls forward has never been stronger.   Cheers to the entire Ripple team on their momentous achievement, and congratulations to those of us that continue to champion XRP as investors and advocates.  

Paris Fintech Forum

The Paris Fintech Forum knows when they have an explosive headline designed to attract attendees to its conference.   On January 30th, Brad Garlinghouse will be on the same panel as Gottfried Leibbrandt, the former CEO of SWIFT who has a history of intentionally ignoring the Silicon Valley company - and its technology - that's been successfully challenging traditional correspondence banking.  

Gottfried Leibbrandt recently stepped down from his post, fueling speculation about the reasons, and whether it would signal a more inclusive approach by SWIFT to consider new technology for transferring international payments.  

The Paris Fintech Forum promoted the panel discussion with a dramatic tweet on January 11th:

Paris Fintech Forum Tweet

I predict some interesting dialogue between the CEO of Ripple and the former CEO of SWIFT.   The history between the two goes back years, and several quotes from Ripple executives and other employees have revealed a frustration with SWIFT that's been brewing for years.  

Hopefully, the panel discussion will be a chance for the two organizations to bury the hatchet, as it's said, and establish a more positive future relationship.   Banking insiders have noted that SWIFT payment flows can co-exist with Ripple technology, so the two are not mutually-exclusive.   However, the implementation costs for newer, younger banks that are not saddled with legacy technology stacks built around SWIFT are much lower. These smaller organizations and banks have been more inclined to jump aboard RippleNet.  

This will be one panel discussion to watch - either in person or over a live-stream if one is published.  


In addition to being listed as a part of Ripple's major milestone announcement, SendFriend provided some interesting details about their own implementation schedule, giving those of us that follow XRP some hint as to when to expect volume from their payments:

SendFriend Tweet by Steven Diep

SendFriend is a relatively new money transmitter.   Its mobile application allows customers to send money from New Jersey to the Philippines.   Why only New Jersey?   The service is working with individual states here in the US to secure its money-transmitter licenses as they expand their service.  

Even though they're small, their low fee structures, enabled by the use of xRapid, should allow them to compete effectively against much larger players like Western Union, and quickly grow their customer rolls.  

XRP News

WietseWind, the creator of the XRP Tip Bot, has announced the creation of a new company, XRPL Labs, with the founding members including himself, @baltazar223, and @ThisIsTriss:

XRP Labs Wietse Tweet

The announcement is great news for the entire XRP Community, as WietseWind is undoubtedly the most prolific developer for XRP in the last year, and has now joined two other talented developers who have also built their own applications and components that 'run on XRP.'

Combined, I have no doubt that the team will end up creating incredible new, and highly-anticipated applications that use XRP.   The XRP Tip Bot is legend, and XRParrot is quickly gaining fans for those that want to conveniently transition their Euros to XRP.  

The list of WietseWind's projects are quite honestly too numerous to list here, although I took a try at it in my last blog of 2018.  

My hope is that we'll see an amazing retail payment solution from XRPL Labs, perhaps integrated with an intuitive interface to the built-in decentralized exchange.   One of Ripple's first software offerings was their RippleTrade wallet, which was then decommissioned later as the company exited the wallet business.   The wallet still has fans - including me - that relished its integration with the XRP Ledger decentralized exchange.  

The team has some amazing XRP-related websites and services that they maintain in the meantime, and I foresee them sharing some of their tools in an open-source fashion, continuing their approach of supporting wider community development.  

WietseWind, in addition to keeping up a frenetic development pace in 2018, consistently made time to help other developers with their own projects.   It's this positive, community-growing approach and outlook that I appreciate more than anything else;  I'm guessing that the culture of their new, combined company will reflect this core value.  

Recurring XRP Tip Bot Tips

One of the new Twitter accounts that the Good Souls Group (GSG) owns, has been configured to work with a program on the back-end that regularly collects its data via a Twitter API, and then automatically takes any tips and splits them evenly among the official list of GSG charities.   The name of the 'splitter' account on Twitter is @xrpcharities.  

This new 'splitter' account was discussed in my most recent blog.  

Each morning for the past few days, I've taken the time to pause and send @xrpcharities a 5 XRP tip to be split among the participating philanthropic efforts.   As I was doing this, I thought it would 'be nice' if I could just schedule a tip to occur periodically.  

Parallel to my daily tipping, WietseWind had developed the very function that I was hoping for: recurring tips!

Here's the communication that @XRPTrump sent out regarding this new feature:

XRP Recurring Tips Tweet

The tweet contains a video of WietseWind setting up a recurring tip through the XRP Tip Bot, and of course, the interface is very intuitive.   The user has the option of setting up a recurring tip to occur on preset frequencies, including daily, weekly, and monthly.  

To access the tool, first log into the XRP Tip Bot website, and then navigate to the following location:  Recurring XRP Tips

I've already set up my recurring daily tip to @xrpcharities.  

New API Published by Bithomp

Bithomp has been around since the early days of the XRP ecosystem, and its tools are used to access information on the XRP Ledger, as well as to establish new wallets.   It's among the most popular sites for tracking specific XRP wallet information;   the user interface is arguably the most intuitive of the XRP wallet browsers.  

On January 11th, Bithomp communicated that they'd added a new API for XRP developers to use, that will provide local account data.   Along with that API, they published a new tool for individuals to submit their own identifying information for their wallet, which will allow Bithomp to display their information and also share it via the new API:

Bithomp Tweet

The submission is not meant for private accounts, but rather, individuals that run a business using XRP that wish to freely share their XRP Ledger information.   This would include exchanges and other financial service providers, as well as some non-profits and small businesses.  

This new submission process, as well as their API, should increase the quality of the information provided by the wallet explorer and allow users to quickly identify relationships on the ledger.  


The Gibraltar Stock Exchange has created a subsidiary that is focused on the listing of cryptocurrencies, called 'GB Exchange.'  17

The Gibraltar Stock Exchange, the parent organization to the GBX-DAX, was formed in 2014 as one of the newest entrants to the collection of European stock exchanges.  18   19

It is also one of the first European stock exchanges to bridge the gap between traditional finance and the cryptomarket, forming its cryptocurrency subsidiary in 2017.  

On January 9th, the crypto exchange announced that XRP would be listed.  

GBX is currently a smaller exchange - 157th by daily volume - but the potential for growth will naturally follow the overall growth of its parent stock exchange, drawing in traditional retail customers that perhaps wouldn't ordinarily step into the cryptomarket.  20

If custody is handled in a responsible manner, I can see multiple, traditional stock exchanges offering an option for their customers to invest in crypto.   The 'early investors' in crypto are accustomed to the sometimes-annoying requirement to manage their own crypto keys, but if traditional retail investment platforms can shield investors from these complexities, I expect that the cryptomarket will start to grow far beyond its humble beginnings.  

The World Will Leave Proof-of-Work Behind

Those that continue to advocate for, or invest in, proof-of-work cryptocurrencies do not understand how profound the intractable problems are with that validation scheme.  

Some cryptocurrency advocates treat proof-of-work like a religion, seemingly convinced that proof-of-work is the only way to solve double-spend in a trust-less manner.  

They are profoundly mistaken.  

Proof of work is not as secure as fault-tolerant consensus (XRP), and leads to greater and greater levels of centralization and risk because of its incentivized structures.   Proof of work cannot scale.   Proof of work is bad for the environment.  

For all of these reasons, the world will not 'bend the knee' to Bitcoin as some Bitcoin maximalists hope.  

In fact, they are in for a shock;  while Bitcoin has had quite a run - and this has given them false confidence - their luck is running out.   The banking world, and mainstream finance, has been made aware of the true nature of the underlying technology, as well as the differences among the networks.  

I suspect that multiple crypto investment funds are re-thinking their portfolios, as it becomes increasingly clear that Bitcoin's heyday is coming to an ignoble end.  

For those of us already acknowledging the inevitable rise of XRP, this shift in the cryptomarket, as well as the greater adoption of XRP by banks and financial institutions looking to lower their payment costs, cannot come soon enough.   It will take time, but it will happen;  innovation adoption is now well on its way, and XRP advocates are already ahead of the curve.  
xrp symbol
Sources and Credits:
Cover Art: Thank you to Mantas Hesthaven