Ripple has become a popular topic lately as it became the #2 cryptocurrency for a brief period last week. While it was trading at around $0.20 just last year, it's now worth more than $3.25 per coin and continuing to rise. It's important to note that Ripple is the company, and XRP is the coin, but most people simply call it Ripple.
Ripple (XRP) is a different than many other popular cryptocurrencies because it was created by a private, for-profit company. This company wanted to enable a frictionless way to send money globally, and it's coin Ripple is the way it does it. This company is also the largest holder of Ripple today.
The problem is, Ripple isn't the easiest crypto currency to buy. It requires some additional steps compared to investing in Litecoin or Ethereum. But let's break it down and show you what to do.
If you want to get a head start, investing in Ripple will require an account:
- Coinbase - To easily buy Ripple (and get $10 free when you invest $100)
Get started opening those up and follow the directions below.
What Is Ripple?
Ripple was originally (and still is) a payment processing platform that allows global transactions using it's coin, XRP. It's global payment network was started in 2012, and has continued to grow as companies have adopted it, and currency speculators have taken interest in Ripple.
Ripple uses a blockchain ledger similar to Bitcoin and other crypto-currenies, but it also has come technical differences that claim to make it easier to process transactions, and more importantly, faster while remaining secure.
How Ripple Is Different
Ripple is different than it's major competitors Bitcoin and Litecoin in that it was created by a private, for-profit company. When it was created, 100 billion XRP were released into the market, with 20 billion being held by the creators and the rest being given to Ripple Labs. Ripple Labs has since placed 55 billion XRP in an escrow account to ensure users stability in the marketplace.
It's important to note that Ripple has been called a "Bitcoin-killer" since at least 2014, but it's only recently that is has gained real traction and momentum among crypto-currency enthusiasts.
Ripple has had explosive price increases similar to other currencies recently, but it's still very "cheap" in terms of price.
How To Invest In Ripple
Note: As of 2020, you can now simply just open a Coinbase account and buy Ripple XRP directly on the platform.
As we mentioned earlier, Ripple is not "easy" to invest in. However, there are rumors that Coinbase will be adding support for Ripple in the near future. If that happens, you can likely expect the price of Ripple to increase substantially as new investors will easily be able to purchase the currency.
However, today, you need to follow a strict process to buy Ripple.
1. Create A Ripple Account
The first thing you need to do is setup a Ripple account. Ripple keeps a list of recommended exchanges that you can buy XRP on here.
Bitsane is a popular choice, because it allows crypto-to-crypto transactions from companies like Coinbase. It's important to note that you can't send money to Bitsane (or any other Ripple exchange currently), so you have to go to Coinbase -> Exchange (Bitsane) -> Ripple.
So, you'll always need two accounts:
- Bitsane: which you can signup for here (You can also invest in Dash on Bitsane)
- Coinbase: Coinbase gives you $10 in free Bitcoin when you signup and deposit $100 or more
Hopefully this changes soon, but that's how it goes today.
2. Buy Bitcoin or Ether on Coinbase
Once you have a Ripple account setup on Bitsane, you need to buy Bitcoin or Ether on Coinbase.
It's very easy to do once you have a Coinbase account setup. You simply go to the Buy/Sell page and enter your information. Then, your Bitcoin will be in your wallet and you can move to step 3.
3. Transfer Your Bitcoin To Bitsane
Once you have your Bitcoin or Ether in your Coinbase account, you can transfer it over to Bitsane. This is also fairly easy to do.
In your Bitsane account, simply click "Balances", then "Wallets", and you can see all the different coins you can hold in your account.
In our case, we're transferring over Bitcoin, so click on Bitcoin, and you'll see a Wallet Address generate. Here's what it looks like:
Once you have that address, you go back to Coinbase, choose "Acccounts", and then "Send". You'll see this screen come up where you can send your Bitcoin to the address generated in Bitsane:
4. Buy Ripple
Once you have your Bitcoin in your account at Bitsane, you can finally buy Ripple (XRP).
At the top of the Bitsane homepage, you can click on XRP/BTC (or XRP/ETH), and setup an exchange:
Once you place your trade, it will show up in your Bitsane account.
Final Thoughts
Like any currency, there is a high degree of risk involved if you're considering investing in Ripple. However, given the low price point, it does have the possibility for a high return with low barrier to entry.
If you don't like the idea of a digital wallet and/or all of these steps, there are no ETFs that track Ripple yet. However, GBTC is an ETF that tracks Bitcoin, and you can invest in both GBTC or Ripple directly at eToro.
You never know, Ripple could skyrocket as high as Bitcoin is today, and you might be thanking yourself in several years.
Robert Farrington is America’s Millennial Money Expert® and America’s Student Loan Debt Expert™, and the founder of The College Investor, a personal finance site dedicated to helping millennials escape student loan debt to start investing and building wealth for the future. You can learn more about him on the About Page, or on his personal site RobertFarrington.com.
He regularly writes about investing, student loan debt, and general personal finance topics geared towards anyone wanting to earn more, get out of debt, and start building wealth for the future.
He has been quoted in major publications including the New York Times, Washington Post, Fox, ABC, NBC, and more. He is also a regular contributor to Forbes.