What is Ripple?
Ripple is a transaction protocol facilitating monetary transactions between digital money exchanges, banks and money service business around the world. Transactions made over Ripple are almost instantaneous (4 seconds) and have minimal operational costs. Ripple was established in 2012 to solve the problems that modern businesses were facing when transacting money globally.
Banks and its customers often face long waiting times (up to 4 days) and high fees when sending money from one financial institution to another. Ripple eliminates these obstacles and enables people to break free from financial networks such as banks and credit cards by not charging exchange fees. Ripple was also designed to act as a pathfinder algorithm to find the cheapest route when exchanging digital assets online, on a global scale (over the RippleNet). Anyone placing a bid for the Dollar against the Chinese Yuan, for example, would automatically find the cheapest option available on the market thanks to the Ripple network.
Ripple (the cryptocurrency) acts as a financial intermediary between transactions on the RippleNet. It is used as a one-time fee to make transactions over the
blockchain possible. These fees are not 'earned' by anyone and are usually destroyed after the transaction is complete. On another hand, Ripple (the currency) may also act as a liquid intermediary bridging between different currencies.