Could Ripple (XRP) Be the Next Bitcoin?

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How does one asset overthrow another and replace it? There is no simple answer because the top center can take many forms. The most common of them (especially when it comes to stocks) is market capitalization. But there are also other quantitative determinants.

For example, in the cryptocurrency market, many cryptocurrencies have left the first place Bitcoin (CRYPTO: BTC) In the dust when it comes to trading activity. But when it comes to market capitalization, just Ethereum No realistic chance of bypassing Bitcoin. It may be a bit more popular and well known compared to cryptocurrencies, thanks to its secondary markets and associated investment assets (such as NFTs).

For other cryptocurrencies, such as ripple (CRYPTO: XRP), becoming the next Bitcoin is going to be tough, to say the least.

Bitcoin vs Ripple

Bitcoin and Ripple Several differences. Bitcoin is the cryptocurrency with its own blockchain, while Ripple was created as a payment settlement system. This alone makes it a serious competitor to Bitcoin, as it is more likely to be adopted by current banking/financial systems than Bitcoin (which is still primarily desirable as an investment asset).

However, Ripple failed as an actual cryptocurrency. When it comes to paying for goods and services via crypto, the chance of Bitcoin being accepted is much higher than that of Ripple.

The primary technological difference between the two is that when Bitcoin follows a Proof of Work system to validate a transaction, Ripple uses a consensus protocol.

Next Bitcoin?

Despite the differences, many of which are in Ripple’s favour, the chances of it becoming the next Bitcoin are pretty low for several reasons. It is currently the seventh largest cryptocurrency by market capitalization, and Bitcoin is about 23 times larger than Ripple. Therefore, the smaller cryptocurrency is not on the right track to dislodge Bitcoin from the top spot. It may not even be possible if the bitcoin price reaches four numbers instead of the current five.

The same goes for the price. At its best, Ripple couldn’t get past $4 per unit, while Bitcoin reached over $67,500.

The only area where Ripple can be considered a more promising crypto investment compared to Bitcoin is its growth potential. Even if we only use previous peak re-reach as a benchmark for comparison, Ripple is far more than bitcoin. The largest cryptocurrency is trading at a discount of 43% from its peak.

However, Ripple can only increase its investment capital 2.5 times by reaching its peak in 2021 and about five times the growth if it reached its all-time high in 2017. Bitcoin will have to exceed many expectations and ceilings to reach this limit.

Foolish takeaway

If you are not familiar with the intricacies Investing in cryptocurrency And different cryptocurrencies, you will naturally learn more about Bitcoin, the most popular cryptocurrency that everyone invests in, from retail investors to institutions, but of the two, buying Ripple might be a little better, even if it could not become the next Bitcoin.

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