Comparing bitcoin and XRP

Bitcoin and Ripple XRP side by side
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Bitcoin has disadvatages vs. XRP.

Early adopters of bitcoin poured their money into it because they could see the potential of the blockchain technology behind it. Anyone who bought into bitcoin in the very beginning has seen serious investment gains.

Unfortunately, bitcoin has far too many drawbacks to make it sustainable on a large scale. As time goes on, the "mining" to create new bitcoins and verify bitcoin transactions takes longer and longer, and the system continues to slow down.

A financial transaction via bitcoin can take hours, and processing fees have crept up to $40 per transaction. According to Wired, bitcoin mining uses more electricity than several small countries combined.

XRP, on the other hand, is a mining-free cryptocurrency that can clear a transaction in mere seconds, for a fraction of a penny. This makes it the perfect software to sell to banks, which handle trillions of dollars a day in transfers.

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Raising the speed limit

Close up of car speed meter
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Ripple's brings new speed to monetary transactions.

If you think apps like PayPal and Venmo send money instantly, think again. The money may show up in your balance, but transactions are actually in “pending” status until the payment is fully cleared between banks.

The majority of banks currently use something called SWIFT technology, which can take several days to complete a payment, especially international ones.

This is why Ripple technology truly is revolutionary. There has never been a way to send money so quickly before. Not only is Ripple faster for banks, but if a financial institution chooses to use the XRP token instead of fiat money like the U.S. dollar, it can save 60% on their transfer fees.

More than 60 banks in Japan and South Korea have already signed on to use XRP beginning in spring of 2018. And major international financial institutions like American Express and Bank of America have agreed to use Ripple technology.

How to buy XRP

Man holding a phone with a bitcoin exchange rate
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You have to buy bitcoin or another cryptocurrency to exchange it for XRP.

It is only a matter of time before more banks will begin announcing their intent to use the XRP coin, and its value will continue to rise.

How do you grab a piece of that? XRP is not available on the popular digital currency exchange Coinbase, which is how you buy bitcoin, and that makes the purchasing process for the Ripple cryptocurrency a whole lot more complicated. But to get started, you still need to sign up for a Coinbase account.

After your identity is verified, you can purchase one of the cryptocurrencies available on Coinbase, like bitcoin or Ether, and transfer it to a digital wallet that accepts XRP. Then, you can exchange your currency for XRP.

In the beginning, buying, selling and exchanging cryptocurrency can be intimidating, and it takes a lot of time and effort to get started. But there are plenty of YouTube tutorials out there to help, and the Ripple Subreddit has tons of helpful links for anyone who is interested.

Fine art as an investment

Stocks can be volatile, cryptos make big swings to either side, and even gold is not immune to the market’s ups and downs.

That’s why if you are looking for the ultimate hedge, it could be worthwhile to check out a real, but overlooked asset: fine art.

Contemporary artwork has outperformed the S&P 500 by a commanding 174% over the past 25 years, according to the Citi Global Art Market chart.

And it’s becoming a popular way to diversify because it’s a real physical asset with little correlation to the stock market.

On a scale of -1 to +1, with 0 representing no link at all, Citi found the correlation between contemporary art and the S&P 500 was just 0.12 during the past 25 years.

Earlier this year, Bank of America investment chief Michael Harnett singled out artwork as a sharp way to outperform over the next decade — due largely to the asset’s track record as an inflation hedge.

Investing in art by the likes of Banksy and Andy Warhol used to be an option only for the ultrarich. But with a new investing platform, you can invest in iconic artworks just like Jeff Bezos and Bill Gates do.

About the Author

Shannon Quinn

Shannon Quinn

Freelance Contributor

Shannon Quinn was formerly a freelance contributor to MoneyWise. Quinn is an entrepreneur and writer from the Philadelphia area.

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