How Ripple (XRP) Became a Competitor to Bitcoin and Ethereum

Daniel Urbánek
Daniel Urbánek
June 20 at 04:00
XRPL, Ethereum, Bitcoin, Education

Follow the journey of one of the largest projects in the crypto industry - the company Ripple and its XRP. From startup struggles to a multinational company.

Ripple is a company of many layers, operating mainly in the B2B crypto sector, helping financial institutions make easier cross-border payments. Although Ripple now has a valuation of over $10B it wasn't always this way. The beginnings of Ripple, as with most tech companies, were humble and crossed with hardships.

Together we will have a closer look at how Ripple emerged, scaled, and eventually reached the current point. We will examine Ripple's famous founding team and how they managed to grow it from a simple payment system to a stable member of the Top 10 largest cryptocurrencies by market cap.


  • Ripple emerged from a company RipplePay founded by Ryan Fugger in 2004. From then it was transformed by David Schwartz, Jed McCaleb, and Arthur Britto.
  • The core motivation for Ripple was to provide a cleaner and more efficient alternative to Bitcoin. These efforts materialized in the form of the decentralized XRP Ledger.
  • During its development Ripple has launched several products, helping mainly financial institutions create a smoother transaction network.
  • From 2020 Ripple has had an ongoing clash with the SEC surrounding its security accusations. This lawsuit has been influential to the whole crypto sector.

RipplePay Founding, NewCoin and OpenCoin

Contrary to popular belief, the company we now know as Ripple was founded all the way back in 2004 by Ryan Fugger, in that time under the name RipplePay. This company initially served a similar purpose as it does now - to simplify international payments.

In 2011 a trio of developers: David Schwartz, Jed McCaleb, and Arthur Britto bought the company from Ryan Fugger and started transforming it into a decentralized digital asset network. The prior inspiration, of course, came from Bitcoin, however, Ripple founders observed significant shortcomings of Bitcoins and sought to create an improved version of this network.

Concerning were mainly environmental aspects of Bitcoin mining, as there is a lot of energy being used to reach a consensus. Therefore the goal with Ripple was to create a fast and energy-efficient decentralized network, which still maintains a high level of security. In 2012 the trio of developers worked on the XRP Ledger public network and the company was renamed to NewCoin, then OpenCoin, until finally settling again on Ripple.

Distributed Ledger Network and XRP Coin

After the first version of XRP Ledger was finished in 2012, the developers made it available to the general public. The Ledger contained a native asset, originally called “Ripples” marked with the ticker XRP.

Upon generating the supply of XRP, 80 % of it was gifted to the underlying company (OpenCoin at the time), which intended to expand the network by building various applications and creating use cases.

Around this time the Ripple community started to generate some confusion around the naming of the project. Simply too many things were being referred to as “Ripple” - the company, the Ledger, and even the digital asset. For this and other reasons in 2013 the company formerly called OpenCoin was rebranded to Ripple Labs (abbreviated simply Ripple). The digital asset kept the name XRP.

Financial Institutions and Development (2014 - 2019)

During the following 5 years, Ripple launched new products focused on helping financial institutions with cross-border payments. These efforts were isolated from the decentralized network XRP Ledger but rather focused on being secure and compliant for the institutions.

Many new connections were established within these years, some of which serve as the basis of the current Ripple business model. For example, In 2014 Ripple Labs released xCurrent, their messaging and automatic settlement platform, which is now part of the unified RippleNet product. Four years later Ripple introduced its On Demand Liquidity Service (ODL) that is designed to help facilitate cross-border transactions for financial institutions.

The year 2017 was a particularly strong one for the XRP digital asset. Amidst the bull run, the price of XRP reached its ATH (All-Time High) of $3.84 per token.

Ripple and the SEC Lawsuit

In December 2020 the Securities and Exchange Commission (SEC) filed an accusation against Ripple and two of its executives, namely Chris Larsen and Bradley Garlinghouse, the current CEO. The SEC accused Ripple of raising more than $1.3 billion in the form of unregistered security (XRP) over the course of several years.

As both sides presented their arguments, Ripple secured its first win against the SEC in 2021. This lawsuit sparked a new wave of regulatory scrutiny for the entire crypto sector. Many other projects were declared security in the eyes of the SEC, such as Polygon (MATIC), Cardano (ADA), or Solana (SOL). However, both BTC and ETH maintain the status of a non-security.

After stretching for almost three years, our court saga seems to continue further. Ripple secured another major victory during the summer of 2023, establishing that XRP is indeed not a security when sold to individual investors. This new information brought a positive sentiment to XRP's price despite the ongoing bear market.

Read more here: SEC & Ripple Clash - A Groundbreaking Verdict That's Reshaping Crypto Regulation

The Final Take

Ripple's trajectory—from its inception as RipplePay to its current stature—illustrates the complexity of the crypto market's evolution. Having witnessed the significant transformation, Ripple's journey provides insights into the challenges and opportunities inherent to the crypto sector.

The recent developments with the SEC further underscore the ongoing dialogue surrounding regulatory classifications in the cryptocurrency realm. As the landscape continues to mature, Ripple’s experience serves as an important case study for stakeholders in the industry. Future developments in this sector will undoubtedly be influenced by the past, emphasizing the importance of regulatory clarity and adaptability.

Disclaimer: The content of this piece reflects the writer's opinion. This article is not intended to provide financial advice and is meant solely for entertainment and educational purposes. Investing in cryptocurrency involves significant risk. Capital is at risk, and returns are not guaranteed. Always conduct your own research.

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