What is XRP?

xrp digital asset

XRP is the native currency of the Ripple network that only exists within the Ripple system. [100] XRP are currently divisible to 6 decimal places, and the smallest unit is called a drop with 1 million drops equaling 1 XRP. [100] There were 100 billion XRP created at Ripple’s inception, with no more allowed to be created according to the protocol’s rules. [101] As such, the system was designed so XRP is a scarce asset with decreasing available supply. [101] Not dependent on any third party for redemption, XRP is the only currency in the Ripple network that does not entail counterparty risk, and it is the only native digital asset. The other currencies in the Ripple network are debt instruments (i.e. liabilities), and exist in the form of balances. [27] Users of the Ripple network are not required to use XRP as a store of value or a medium of exchange. Each Ripple account is required, however, to have a small reserve of 20 XRP for anti-spam purposes. [102]

“XRP exists natively within the Ripple protocol as a counterparty-free currency, as Bitcoin does on the Blockchain. Because XRP is an asset, as opposed to a redeemable balance, it does not require that users trust any specific financial institution to trade or exchange it. All other currencies on Ripple do require some amount of trust, as they each have an issuer, from whom that currency can be redeemed (this includes BTC on the Ripple network).”
— Ripple protocol [99]
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