Cryptocurrency and precious metals have a strong relationship as stores of value. Many investors that dabble in precious metals, also invest in crypto. Because of this interesting correlation between the two, many blockchain creators and precious metal exchanges have included services that allow you to purchase gold. One significant crypto player in the game is Ripple.

What is Ripple?

Ripple is a cryptocurrency that utilizes the XRP ticker symbol. Ripple is the company and XRP is the cryptocurrency. Another important feature to Ripple is its blockchain digital payment network that facilitates financial transactions. Co-founded by Jeb McCaleb and Chris Larsen in 2012, Ripple was meant to compete with the US’s SWIFT payment system which is used by millions of people and institutions worldwide for money transfers. Financial institutions use SWIFT to transact different currencies internationally.

The co-founders created Ripple as a means to operate as an intermediate exchange mechanism between currencies or networks. Instead of mining, as other cryptocurrencies do, Ripple operates as a consensus mechanism that uses servers to confirm transactions.  Confirmation of transaction occurs within minutes. Another positive attribute is that Ripple uses less energy than other cryptocurrencies. Currently, Ripple is the sixth most valuable cryptocurrency by market capitalization.

Ripple is a peer-to-peer and open-sourced decentralized system that allows easy transfers of all international fiat and cryptocurrencies like the hawala method. The hawala method is an informal method of transferring money without physically moving it. Large financial institutions have adopted the use of Ripple for its seamless use of transacting currencies.

As of September 2021, XRP has a market capitalization of at least $52 billion and is worth around USD 1. 

How does Ripple Operate?

Ripple is very different from other cryptocurrencies such as Bitcoin because it does not use proof-of-work or proof-of-stake systems. The system of transactions used by Ripple consists of a consensus protocol that validates transactions from approved accounts. This system prevents double-spending which improves the integrity of transactions.

If you try to initiate a couple of sets of transactions through multiple gateways, the first transaction will get canceled. This happens because the consensus of individual distributed nodes chooses which transactions are made first. Transactions are completed in seconds. Since XRP is a decentralized platform, no one needs to approve the transaction.

Ripple’s blockchain system record all IOUs. Anyone can look up XRPs consensus ledgers since they are made public. This allows you to audit transactions and you will be able to see IOU credits that happen between digital wallets and XRP. The blockchain hides the personal information of transactions. 

Do precious metals exchanges handle XRP?

Since the adoption of XRP as a form of digital currency, many exchanges are happy to include this forward-thinking form of payment. Precious metal exchanges, with both physical locations and websites, are one of the primary merchants that accept cryptocurrencies in exchange for gold. 

Precious metal exchanges make it very easy to use XRP through several different applications in the crypto space. You can simply shop on their site, add your desired metals to the cart, select cryptocurrency as a form of payment where you can then apply your XRP. Straightforward. Because of many reputable companies in the precious metals industry adopting the use of Ripple, XRP is becoming a trusted method of buying gold, silver, and platinum

Why should you purchase precious metals using Ripple? 

Purchasing precious metals using XRP provides many benefits you might not have been aware of. Since XRP is one of the most trusted currencies in the world for financial institutions for conducting transactions, it provides seamless transactions compared to other digital and fiat currencies. Ripple was designed to move currencies at a faster rate than traditional payment system methods like SWIFT.

Another factor to consider is lower transaction costs such as processing and foreign exchange fees. If you use checks, Paypal, debit, or credit cards, you will encounter higher fees which will make your purchase more expensive overall. Sometimes as high as 6% fees! Imagine purchasing a large order and having to include such high percentage fees when all you need to do is use your XRP. 

What should I be aware of when using Ripple to purchase gold? 

Since cryptocurrencies are a new form of currency and use of payment, crypto can be a highly volatile market. Stay current with the news of crypto markets as changing rules and regulations occur at a moment’s notice. So if you want to protect against the volatility of the crypto and stock markets, buy gold, silver, platinum, and palladium. These metals continue to show stability as we speak.

Conclusion

Now you have a better understanding of how to buy gold with XRP. XRP’s transaction fees make for an appealing form of payment. Many new forms of transactions are under development for XRP’s blockchain system. We will be here to give you any new updates.

Leave a Comment

Your email address will not be published. Required fields are marked *