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XRP Ledger

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XRP Ledger
Original author(s)Jed McCaleb, Arthur Britto, David Schwartz
Initial releaseJune 2012
Stable release
1.0.0[1] / 15 May 2018[1]
Repository
Written inC++
Operating systemServer: Linux (RHEL, CentOS, Ubuntu), Windows, macOS (development only)
TypeReal-time gross settlement, currency exchange, remittance
LicenseISC license
Websitexrpl.org

The XRP Ledger (XRPL) is a decentralized distributed open source blockchain launched in 2012 that serves a variety of use cases and is open to financial institutions worldwide. The XRPL employs the native cryptocurrency known as XRP, and supports tokens representing fiat currency, cryptocurrency, commodities, or other units of value such as frequent flyer miles or mobile minutes.[2] XRPL functions with a consensus protocol where designated servers called validators come to an agreement on the order and outcome of XRP transactions every three to five seconds. XRP has been noted to have substantially greater energy efficiency (and therefore less environmental impact) than most cryptocurrencies. XRP has been noted to have substantially greater energy efficiency (and therefore less environmental impact) than most cryptocurrencies.

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, focused on solving the problem of the waste inherent in Bitcoin mining. 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 Ripple Consensus Ledger was later renamed the XRP Ledger.

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".[3]

Technical overview

The XRP Ledger operates on a consensus protocol that differs from traditional proof-of-work (PoW) and proof-of-stake (PoS) mechanisms. Transactions are validated by a network of independent validators who reach consensus every 3 to 5 seconds, enabling rapid transaction settlement. This consensus mechanism reduces energy consumption significantly, making XRP one of the least energy-intensive cryptocurrencies. The network allows any user to operate a validator, but 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 platform's consensus protocol eliminates the need for energy-intensive mining operations, contributing to its lower environmental impact. Ripple Labs, one of the largest companies to operate on the XRPL, has pledged to achieve net-zero carbon emissions by 2030, aiming to further reduce the environmental footprint of the network. A scientific study made by two researchers from Stanford and Stockholm universities that studied the money production from an energy consumption point of view and a macroeconomic level stated that running a server on XRPL was comparable to the energy needs of running an email server.

Role of Ripple Labs

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.The XRPL founders gifted 80 billion XRP, the platform’s native currency, to Ripple Labs. Ripple Labs holds a portion of XRP in escrow and periodically releases tokens into circulation through sales, aiming to maintain market stability.

See also

References

  1. ^ a b "Official source code". Github. Retrieved May 14, 2014.
  2. ^ "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.
  3. ^ District court summary judgement, pdf, 13 July 2023.
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