Happy holidays, folks. It’s been a long, tough year in the world of crypto, but if you’re reading this, I think you’ll be on the right side of history when the dust settles.
We’re riding out this crypto winter by putting together some of the best blockchain guides out there. The most important thing you can do right now is build knowledge, expand your understanding, and gain confidence in this new technology.
So, whether you’re bored over the holidays or hiding from the in-laws, let’s dive into some of our most popular guides so far. (If you like them, stick around because we’ll have plenty more in the new year).
This is our flagship beginner’s guide to bitcoin. It’s written in simple, easy-to-understand language, but you’ll feel like a pro by the end of it. We cover everything from bitcoin’s mysterious creator, the technology that powers it, and how to buy it.
A beginner’s guide to the third-largest cryptocurrency, Ethereum. Like our bitcoin guide, it’s written in simple language designed to level up your knowledge as you read through it. Discover how Ethereum is different to bitcoin and how it could disrupt an entire generation of existing services.
Launched in February 2011, the infamous Silk Road marketplace became a hub for drug dealers using bitcoin and the dark web to sell their wares. Silk Road founder Ross Ulbricht is currently serving a double life sentence, plus 40 years, without parole. But the story is not so simple. It’s a story of corrupt police detectives, aliases, and deep conspiracy.
We reveal 24 clues about the elusive creator of bitcoin. Known only as the pseudonym “Satoshi Nakamoto,” Bitcoin’s founder has never been identified. He disappeared completely in 2011, but not without leaving a few possible hints at his identity.
In late 2017, a blockchain game called Cryptokitties became so popular it congested the entire Ethereum network. But it gave us an insight into how big blockchain gaming could become. Although most blockchain games are still quite primitive, there’s huge potential out there. Here are 13 of the best so far.
As the New York Times reported earlier this year, the blockchain industry has been dominated by “blockchain bros,” with women accounting for just four-to-six percent of blockchain investors. We shine a light on ten groundbreaking women taking the industry forward.
We track the cryptocurrency timeline back to the very earliest attempts at digital currency (ten years before bitcoin was created). Along the way, we point out the biggest moments in bitcoin history including the infamous Mt. Gox hack, the Silk Road dark-web marketplace, to the historic $20,000 price tag.
Storing your bitcoin in a safe and secure wallet is the most important decision you’ll make in your crypto journey. But how do you find one you trust? We dive into the 12 best wallets in 2018 and beyond.
2018 was epic. It started with the madness of altcoins rally at the beginning of the year. Followed by massive steps towards bitcoin and crypto mass-adoption made by regulators, large enterprises, and institutional investors.
And it ended with the blood and tears of traders on the streets (we can still hear some of them screaming).
Block Explorer is willing to reflect on the most important events that brought the industry to its current state. So, here are the major crypto announcements that shaped 2018:
1. January: The Perfect Month to Ban Something
Bitcoin price: $14,112 (on the first of the month)
The beginning of January was marked by the huge news splash made by the South Korean government. They unveiled plans to ban anonymous trading on cryptocurrency exchanges over tax avoidance. And sent the police and tax-collecting authorities to their offices.
As a result, the bitcoin price decreased by $2,000.
At the end of the month, crypto was in trouble again, as Facebook decided to ban all ads related to digital currencies. Since Facebook marketing was a major driving force for many initial coin offerings (ICOs), it cut the source of easy promo for many blockchain startups.
2. February: China and Bankers Join Forces Against Bitcoin
Bitcoin price: $10,264
It’s not easy living in China without the freedom of internet browsing, catching up with friends on Facebook or just googling. All of that is restricted by the “Great Firewall of China.”At the beginning of February, the list of undesirable foreign websites was supplemented with bitcoin-related websites to eliminate the financial risks for Chinese citizens.
Next, the head of the Bank for International Settlements (BIS) called bitcoin “a bubble, a Ponzi scheme, and an environmental disaster”. The media went nuts over it, and the more they referred to it in the following articles the more the price of crypto was sliding down, falling as much as 14% in one day.
3. March: SEC has a Crush on Crypto Exchanges. Google Doesn’t
Bitcoin price: $10,433
Some more heartbreaking and uncomfortable milestones for bitcoin and crypto included the U.S. Securities and Exchange Commission (SEC) announcement made in March. They obliged all cryptocurrency exchanges to go through the registration procedure through the agency.
In April, crypto’s misadventures continued. This time the Central Bank of India (The Reserve Bank of India) banned financial institutions from allowing transactions from people’s accounts to bitcoin wallets.
5. May: Goldman Sachs is Going Crypto, “Rich Dudes” are Boiling Over
Although some people were are not happy about it. Including some very “rich dudes” that were on a mission to come up with the most-quoted insult for bitcoin. For instance, well-known billionaire value investor Warren Buffett referred to bitcoin as “rat poison squared,” and Bill Gates, one of the kindest billionaires in the world, labeled it a “greater fool theory”.
But even in spite of all those troubles, crypto was still on a good path to wider acceptance. Or how else could you explain the 25 million crypto wallets registered at blockchain.com?
6. June: Facebook is Stricken by FOMO
Bitcoin price: $7,519
In June it was time for more bad news. It’s never enough in the crypto world. A panic sell-off happened in the first half of the month after Coinrail’s hack announcement. Even though this South Korean exchange was relatively small it led to a rapid 10% drop in bitcoin price.
A couple of weeks later, big news came from Facebook who decided to reconsider the crypto advertising ban. Promoting initial coin offerings was still off the table though.
7. July: Winklevoss Twins Keep Being Stubborn With SEC
Bitcoin price: $6,366
July was relatively calm for cryptocurrencies. Probably because most of the troublemakers were on vacation. But some news was still in the air, including the fact that asset-management heavy-weight BlackRock was looking into crypto assets and another SEC rejection of exchange-traded fund (ETF) proposal filed by Winklevoss twins.
8. August: Too Many Rejections of ETF Proposals
Bitcoin price: $7,634
August was all about ETF proposals, their postponing and rejections. The bitcoin exchange rates struggled at first, but at the end of the month, after the U.S. Security Exchange Commission declined nine bitcoin ETFs, the price of the major crypto remained stable. How resilient is it?
9. September: The First Crypto-Related Company Files for IPO
Bitcoin price: $7,192
Most of September’s announcements were quite positive. First, there was more news about Goldman Sachs jumping into crypto. The company’s chief financial officer Martin Chavez confirmed that the Wall Street giant was working on the development of bitcoin-based derivatives that will be accessible to the bank’s clients.
At the end of the month, one of the leading bitcoin miners, Bitmain, spilled out their intention to run an initial public offering (IPO). And the application for the process was already filed. Bitcoin Cash prices (one of the assets Bitmain is mining) surged up to 20% rapidly.
10. October: Happy birthday, Bitcoin. Here’s Your Mass-Adoption
Bitcoin price: $6,619
More happy news to celebrate the ten-year anniversary of Bitcoin’s whitepaper. Big steps from institutional investors happened in the middle of October when Fidelity Investments announced the launch of a spin-off company, dedicated to crypto assets exclusively. The new firm named Fidelity Digital Assets was onboarding its first clients and still preparing for the grand opening for the general public in 2019.
Also, the launch of the first blockchain phone, made by HTC, stole the headlines in October.
11. November: Blood, Sweat, and Tears of Bitcoin Cash Fork
Bitcoin price: $6,427
Fights over the Bitcoin Cash fork got completely out of control. The battle between BCHSV (Satoshi Vision), lead by Craig Wright, aka Fake Satoshi and BCHABC (Adjustable Blocksize Cap), driven by Roger Ver, previously labeled as Bitcoin Jesus was observed by the entire industry. It triggered huge crypto volatility, increased trading volume and, as some experts might say, a bitcoin nosedive to a new bottom. And we are still in the middle of that roller coaster.
XRP aims to revolutionize the way we send money around the world.
That’s a bold statement, but it’s why XRP is now the second-largest cryptocurrency by market capitalization.
But let’s not get carried away. XRP and its closely-connected company, Ripple, have divided the cryptocurrency community by partnering with some of the world’s biggest banks.
So what is Ripple and the cryptocurrency XRP? Why is it so revolutionary, and why is Ripple criticized? Most importantly, where can you buy XRP and how do you store it safely?
Part 1: What’s the difference between Ripple and XRP?
Part 2: Understanding the Ripple blockchain
Part 3: Exploring Ripple’s Bank Partnerships
Part 4: Why is Ripple so Controversial?
Part 5: How to Buy XRP and Store it Safely
Part 6: What’s Next for Ripple and XRP?
PART 1: What’s the Difference Between Ripple and XRP?
Ripple vs XRP
Before we dive in, let’s clear up a few things:
Ripple is a company
Ripple aims to streamline the way we send money around the world using blockchain-inspired technology. The company has over 100 bank partners using its services.
XRP is the cryptocurrency
XRP is a token created by the same people behind Ripple. Ripple is trying to get banks to use XRP to make international payments more efficient.
The term “Ripple” is often used interchangeably to refer to both the company and the cryptocurrency. But that’s not strictly correct.
So, from here on out, if we mention Ripple, we’re talking about the company. If we mention XRP, we’re talking about the cryptocurrency.
Got It. So What Is Ripple (The Company?)
“The vision is to make an international payment as cheap and easy as pulling up a web page. Something you would do without even thinking about the mechanics or the cost. It’s just so automatic and cheap… It’s almost invisible.” Ripple CTO David Schwartz.
Have you ever tried to send money abroad? You wait days for the transfer and the bank charges you a fortune for the privilege.
This current method is extremely outdated, slow and expensive. It was created in the ‘70s and ‘80s (and hasn’t changed much since).
Ripple offers its blockchain-inspired software to banks to help change this.
Ripple aims to do for money what the internet did for communication. i.e. make it instant and free. They call it the “internet of value”.
Ripple Has Partnered with 120+ Banks
Here’s where Ripple is different from most other projects in the world of cryptocurrency. Instead of building an alternative to the traditional banking system, Ripple is actively partnering with the world’s biggest banks.
They’re trying to convince banks to switch their old system to the Ripple network.
Ripple now has over 100 partnerships with banks and money services like Santander and American Express. They’re each using (or testing) a version of Ripple’s technology.
But wait. How exactly does XRP fit into this equation?
What is XRP?
XRP was created by the same people that created Ripple.
100 billion XRP tokens exist, and they were created all at once (known as “pre-mined”).
That makes XRP completely different to bitcoin and ethereum, where the tokens are slowly mined into existence by its users.
The key feature of XRP is speed. It allows for significantly faster payments than bitcoin and ethereum.
What Is XRP Used For?
Ripple plans to use XRP as a “bridge currency” when exchanging money abroad.
Let’s say you live in Great Britain and you want to send money to your family in Mexico.
Normally, this would take days and incur a huge fee using the current payment systems.
Worse, you can’t always make a direct exchange. Your bank may have to convert the sterling to a “reserve currency” (US dollars) first, then convert it to Mexican pesos. This adds another layer of fees and delays.
Instead, Ripple aims to use XRP as the “bridge.”
In this example, sterling is instantly converted to XRP, then instantly converted to pesos.
It might seem like a small change, but because you’re exchanging through a digital currency, it’s instant and almost completely free.
How Is XRP Different to Bitcoin?
XRP and bitcoin are both aimed at money transfers. In that sense, they share a similarity.
However, that’s really where the comparisons end. XRP and bitcoin are wildly different in almost every other way.
XRP is faster – An XRP transaction takes 3.5 seconds. Bitcoin may take hours or even days at high volume.
Every XRP token already exists – The tokens were simply coded into existence all at once, unlike bitcoin which is mined.
There are 100 billion XRP tokens – Bitcoin, on the other hand, has a hard cap of 21 million. In other words, there are nearly 5,000-times more XRP tokens than bitcoins.
Ripple holds half of all XRP tokens – Ripple currently owns roughly 60% of all XRP tokens. 55 million of those tokens are locked in escrow, with one billion released to Ripple each month.
Bitcoin and XRP both have a hard cap – Ripple claims that no more XRP tokens will ever be created, giving it a hard cap of 100 billion.
XRP is aimed at banks – Of course, the biggest difference is the target audience. Bitcoin was created to provide an alternative to the banking system. It’s a money system or store of value that cuts out banks. XRP is created as a form of liquidity for banks to transfer money.
“While contrarian and unpopular in the crypto space, in retrospect it’s very smart” – Ripple CEO, Brad Garlinghouse.
The Ripple Team
Ripple originally goes back to 2004 when Ryan Fuger created an IOU system for exchanging credits.
But Ripple, as we know it now, really began when founders Jed McCaleb, Chris Larsen, and Arthur Britto took over in 2012. They established the company as “NewCoin,” before renaming it “OpenCoin,” and ultimately evolving it into Ripple Labs in 2013.
If the name Jed McCaleb sounds familiar, it’s because he was also the founder of Mt. Gox, the infamous exchange that suffered an $850 billion hack in 2014. (Although McCaleb was no longer involved when the hack took place).
McCaleb also went on to found Stellar – the sixth largest cryptocurrency. He’s a serial cryptocurrency entrepreneur.
Chris Larsen was Ripple’s founding CTO. He’s widely considered the richest person in crypto due to his early stake in Ripple and his XRP holdings.
Ripple’s System is Nothing Like Bitcoin’s Blockchain…
Ripple uses a “distributed consensus ledger.”
They call it the XRP Ledger.
To explain, we need to go back to bitcoin for a minute.
The bitcoin blockchain is powered and maintained by miners.
Let’s say Bob sends one bitcoin to Alice. To confirm the payment, a network of miners all over the world compete to validate the transaction. They do it by solving a complex math puzzle with computing power.
(If this all sounds foreign to you, read our Bitcoin eBook first to get your head around the traditional crypto mining system).
This doesn’t happen in the Ripple system. There are no miners involved.
Instead, it uses a “consensus” system.
Let’s say Bob sends 100 XRP to Alice this time.
Instead of miners processing the transaction, the XRP Ledger has roughly 150 computer “validators” all over the world. Some validators are run by individuals, some by companies, some by exchanges. 7% of those validators are run by Ripple itself.
When Bob makes his transaction to Alice, there is a simple poll among the servers and validators on the Ripple network. If a “consensus” of the servers agree, the transaction is made and stored on the ledger.
Users on the XRP Ledger can also tweak their settings to “trust” certain validators in the network. So if one “trusted validator” approves a transaction, another will automatically follow the decision.
Pros of the Ripple system
It’s fast. Really fast.
Bitcoin mining takes a long time and a huge amount of energy. Competing to solve math puzzles on the Bitcoin network drains enormous amounts of computer power.
Getting rid of that process makes Ripple’s transactions much faster.
We must also consider that Ripple’s network is designed for banks.
Whether you think this is good or bad, Ripple needs a simpler system with more control to get banks on board.
Cons of the Ripple System
It’s arguably more centralized. Without active miners holding every transaction accountable, there’s an argument it’s a more centralized system.
Ripple disputes this, claiming the Ripple system is less centralized than Bitcoin because Bitcoin mining is dominated by a handful of huge mining pools, largely based in China.
PART 3: Exploring Ripple’s Major Bank Partnerships
We know that Ripple is working closely with banks, but let’s dive a little deeper into how their relationships work.
120+ Bank Partnerships
Ripple has announced a number of high-profile partnerships. They are working with Santander, American Express, SBI, Western Union and many more.
While this sounds impressive, there are a few things we need to explain. When Ripple says they have over 100 bank partnerships, that does not mean they are all using the XRP token.
At least four financial companies are actively using the XRP token to make international payments. The rest are either piloting the XRP technology or using one of Ripple’s other blockchain solutions.
To explain, here’s a breakdown of how Ripple partners with banks.
xCurrent is Ripple’s main software package. It is still impressive in that it allows banks to settle cross-border payments almost instantly.
xCurrent also provides banks with a real-time messaging service. It verifies payment details before the transaction is made and confirms the exchange when it arrives.
It’s fast and cheap, but it doesn’t use the XRP token to settle payments.
When Ripple talks about bank partnerships, they are usually talking about xCurrent.
Ripple’s main goal is to migrate banks from xCurrent to xRapid.
xRapid does use the XRP token as a “bridge currency” to execute cross-border transactions.
In recent tests, banks have reported between 40-70% cost savings and almost instant transfers.
Why the Old System Is So Inefficient
To understand why xRapid is so revolutionary, we need to understand how inefficient the existing system is.
Let’s go back to our UK-Mexico transaction to explain. Maria wants to send £1,000 to her family’s bank account in Mexico.
To make the transfer, her UK bank needs a “nostro account” in Mexico. That nostro account is pre-funded with Mexican pesos, so the bank can exchange the currency.
Banks have these pre-funded nostro accounts in every country (well, every country with a different currency – the bank will have just one nostro account in the eurozone, for example).
This is what the banks call “liquidity.” They need “liquid” money available in each country to make the currency exchange.
“That’s capital sitting dormant, and not being used.” – Garlinghouse.
An estimated $10 trillion is sitting idle in nostro accounts. It’s wildly inefficient.
Now imagine if they didn’t need pre-funded nostro accounts all over the world. What if they just had a liquid supply of digital currency in one place?
Are Banks Using xRapid (and Therefore XRP)?
At least four financial companies are now using xRapid commercially.
They include Catalyst Corporate Credit Union (a financial firm), Cuallix, MercuryFX, and Viamericas (money transfer services).
The rest of Ripple’s bank partners are not yet using the XRP token. Ripple hopes to nudge them towards xRapid as they grow more comfortable with the technology.
PART 4: Ripple Controversy
Ripple has been wrapped up in controversy for years in the crypto space. There are few coins and projects that attract as much animosity and criticisms as Ripple. Here are some of the biggest:
Generally speaking, all the criticisms of Ripple and XRP revolve around centralization. In other words, too much control in the hands of Ripple itself and too many relationships with the existing banking industry.
“The Banker’s Coin”
Many in the cryptocurrency community take issue with Ripple’s banking partnerships. They argue that bitcoin and cryptocurrencies were designed to reduce the influence and reliance on banks. Ripple’s involvement with some of the biggest banks in the world makes some people unconformable.
Ripple Holds 60% of XRP
Critics point to the fact that Ripple owns more than half the supply of XRP and can theoretically exact control over it. Of those holdings, 55 million are locked in escrow, with one billion released to Ripple each month.
Ripple’s Involvement in XRP
Unlike bitcoin or ethereum, which is mined into existence by its users, XRP was simply created all at once. Ripple has distanced itself from the creation of XRP, calling it an independent asset.
They say their share of XRP was “gifted” to them by the open source developers that created it. In a UK Parliament hearing, Ripple’s director of regulatory relations said this:
“XRP is open source and it was not created by our company, so [XRP] existed as an open source technology. We created a company that was interested in modernizing payments and then began using that open-source tech to do so … We didn’t create XRP … What we do have is we do own a significant amount of XRP, it was gifted to us by some of the open-source developers that created it. But there’s not a direct connection between Ripple the company and XRP.”
“It is very clearly decentralized. I, as CEO of the company, can’t control the XRP ledger. I can’t change a transaction… Anybody can participate in the XRP ecosystem, and if Ripple does something that is not in the best interest of the ecosystem, the rest of the ecosystem can ignore us.”
Ripple’s CTO also weighed in, saying XRP is less centralized than bitcoin and ethereum. He pointed to the fact that only four mining groups control more than 50% of the bitcoin and ethereum network. Ripple, he says, controls only 7% of validators on the XRP ledger.
Part Four: How to Buy and Store Ripple XRP Safely
How to Buy XRP
You may have noticed that XRP is not currently available to buy on Coinbase or Gemini – the two largest US crypto exchanges.
Coinbase and Gemini claim they are reluctant to add XRP because of the ongoing debate about whether it classifies as a security. As mentioned, there are more hoops to jump through when listing a security on an exchange.
Until this issue is cleared, we may not see XRP available on Coinbase.
With that in mind, there are two options for buying XRP:
Simply create an account at one of these exchanges and exchange USD directly for XRP.
2. Buy Bitcoin on Coinbase, Then Convert to XRP on Another Exchange
This second option is more complicated. However, it may be the best route depending on your local currency.
For example, it is difficult to purchase XRP with British sterling due to the lack of available exchanges and low liquidity.
In this case, you’ll need a roundabout solution:
1. Purchase bitcoin or ethereum on your preferred, trusted exchange, such as Coinbase.
2. Next, register with a crypto-crypto exchange that allows you to trade bitcoin for XRP. (Binanceis perhaps the best known, but there are many others out there).
3. Confirm your Binance account via email and set up 2FA (if you want to trade more than 2BTC, you’ll need to upload ID documents).
4. Navigate to “funds” > “deposit” > “Select deposits coin”
5. Select the currency you are sending from Coinbase, in this case, bitcoin. Binance will now give you a “deposit address.” It’s very important that you note this address down correctly. If you get it wrong, you will send the bitcoin to someone else, and you’ll never get it back.
6. Head back to Coinbase. Select “send funds” and input the deposit address from Binance.
7. Send (this may take a couple of hours at peak times)
8. Back on Binance, you should now see your transferred bitcoin funds.
9. Purchase XRP on Binance. Using the trading screen, you can now trade your bitcoin funds for XRP.
How to Safely Store XRP
Once you’ve bought XRP, we highly recommend you move it to a cold storage wallet (in other words, a wallet not connected to the internet).
There are exceptions. For example, if you intend to trade XRP regularly or use it for live transfers. In that case, you may want to keep a small portion in a “hot wallet” connected to the internet or leave it on the exchange for trading.
But let’s assume you want to hold XRP for the future in the safest possible way. That means cold storage.
Hardware wallet – a hardware wallet is like an external hard drive or USB stick but optimized for cryptocurrencies. Except for the short moment when you transfer your coins, hardware wallets are almost always offline. That makes them safe from hackers.
The only risk here is losing or damaging your hardware wallet. If that happens, your XRP tokens are gone forever.
The most popular hardware wallets are Ledger and Trezor. However, Trezor does not yet support XRP.
BitGo also offers a cold storage custody service for those with large sums of XRP.
Desktop wallet – A desktop wallet stores your cryptocurrency keys on your computer using a software package. On the plus side, they are more convenient for regular use and trading. But on the other hand, they are somewhat more vulnerable to hackers.
One of the most popular XRP desktop wallets is Toast. It’s an open source software available for Mac, Windows, iOS, and Android.
Online wallets – Online wallets do exactly what they say; store your XRP online. While this is super convenient and easy to use, they are less secure. If you want to pursue this route, Coinpayments is a popular option that supports XRP.
Part Six: What’s Next For Ripple XRP?
The fact that four of Ripple’s partners are now using XRP is a huge step forward.
However, there’s a long road before XRP becomes widely adopted by banks and money transfer companies.
Ripple has two main tasks to achieve. First, they must partner with crypto exchange all over the world. So far, Ripple has partnered with Bittrex to facilitate transfers through USD, Bitso for Mexican pesos and Coins.ph for Philippine pesos.
But Ripple will need partnerships like this all over the world for XRP to become a worldwide bridge currency.
Secondly, Ripple needs to convince banks to upgrade from xCurrent to xRapid. In other words, they need to convince banks to actually use cryptocurrency.
As one Ripple exec said, the narrative has always been “blockchain good, crypto bad.” So while xCurrent’s blockchain technology is an easier sell, xRapid’s cryptocurrency product is more difficult.
Progress is being made. Many banks are trialing the XRP service and reporting good results.
Brad Garlinghouse claims that “dozens” of banks will be using xRapid by the end of 2019. Block Explorer will keep you up to date as we hear more.
Ripple is also working on a project called Xpring (pronounced “spring”). It aims to encourage tech startups to use the XRP Ledger.
Xpring will see Ripple support startups with grants and investments that use XRP in innovative ways.
It aims to open up the XRP ledger to new use-cases, not just global money transfers. Xpring is currently supporting projects in music with Scooter Braun (Justin Bieber’s manager. Yes, really), and a tech startup called Omni, which allows you to rent or store just about anything.
Ripple is building a new standard in global money transfers. With hundreds of bank partners, it has the potential to upend the entire financial industry.
However, that doesn’t mean the cryptocurrency XRP is a sure thing. Getting banks to adopt blockchain technology is one thing. Convincing them to transfer money using a digital currency is the next big challenge.
Every Friday, we take a light-hearted tour through the best memes, artwork, and oddities from the cryptoverse. In a year when $1 billion crypto was stolen, Carty Sewill explorers a meme devoted to crypto hacks: “Funds are Safu.”
We’ve all felt it. The overwhelming anxiety that comes when you log into an exchange and see any change in balance or lack of withdrawal options. It instantly triggers thoughts of GOX. Whether it’s a hack, a server error, or just maintenance, we’re a shaky bunch; with good reason. Sometimes we need assurances. We want to know our ‘Funds are safu.’
The majority of us have a few exchanges we trust and most of us use one of those exchanges like a wallet. Binance being one such exchange for many a crypto-enthusiast. And in early March of 2018 the collective PTSD of the crypto-community was triggered once again when an API and SYScoin attack caused a disruption of balances and the temporary shutdown on Binance.
In a clever scheme, a hacker used Binance APIs to target a low liquidity coin, SYScoin, in order to manipulate the order book and use access to a high volume account to withdraw Bitcoin without an audit. The hack triggered an immediate shutdown of Binance and as a consequence the cryptosphere went on red alert. Thousands of Twitter handles began screaming foul and speculating as to whether or not their funds were still sitting safely in Binance wallets.
In response, Binance CEO Changpeng Zhao (CZ) tweeted an explanation claiming “all funds are safe.”Soon, 4Chan channel /biz/ was exploding with parody and the phrase “Funds are Safu,” was born. In just a few days, Bizonacci cemented ‘Funds are Safu’ as a crypto-meme when he released an animated mockery of the situation on Youtube.
As usual in, our small corner of the internet, original content began flooding Twitter. The meme was a hit and even CZ himself played along, tweeting “Funds are safu,” during a scheduled upgrade later in the month. Even going so far as to name the Binance insurance fund S.A.F.U.
It’s a meme with legs and it’s unlikely to go anywhere anytime soon. Reminding all of us to remain vigilant, use 2FA, and keep our funds safu.
Earlier this year, Ripple CEO Brad Garlinghouse promised that “dozens” of banks will use its cryptocurrency product xRapid to power international money exchange in 2019.
So far, however, only four companies are on board. They include money transfer services (Viamericas, Cuallix, and MercuryFX) and a financial firm (Catalyst Corporate Credit Union).
None could be described as a bank.
What Ripple enthusiasts are waiting for are the big names: Santander, American Express, SBI, each of which are using a version of Ripple’s services, but not the cryptocurrency XRP itself.
Banks and xRapid: “Regulatory Framework” is not clear
Ripple’s Global Head of Banking Marjan Delatinne offered an insight into why banks are reluctant to embrace XRP and xRapid:
“No banking institution is using [xRapid]. Regulatory framework around the usage of digital assets is not very clear for banks but payment service providers or other finance institutions are less governed by these obligations.”
Due to regulation uncertainty, NO banking institutions are using xRapid as of now, ONLY payment service providers.
This goes some way to answering the question of why money transfer services are the first to sign up to xRapid. Without clear guidance from governments, central banks, and regulators, banks are unlikely to use XRP or any other digital currency.
This process is likely to drag on as Ripple is still in court over its controversial links with the cryptocurrency XRP. Until the courts and, ultimately, the Securities and Exchange Commission (SEC), confirm whether or not XRP is a security, we are unlikely to see banks integrate the xRapid system.
xRapid is a service offered by Ripple that uses the XRP cryptocurrency to speed up cross-border money transfers. It uses XRP as a “bridge currency” when making international exchanges.
xRapid eliminates the need for nostro accounts, whereby banks pre-fund hundreds of international accounts all over the world in order to execute foreign exchanges. Instead, banks would exchange through XRP instantly and on-demand.
In early pilot tests, banks reported 70% savings with transfers taking minutes, rather than days using the old system.
xRapid went live in October 2018, but only four financial companies have officially jumped on board.
Despite the holdups, Ripple has revealed one major step forward. CEO Brad Garlinghouse announced that BitStamp is now an official xRapid exchange partner. Ripple needs to partner with multiple crypto exchanges around the world as they will ultimately power transfers between XRP and the necessary fiat currency.
BitStamp joins Bittrex, Bitso, and Coins.ph in Ripple’s exchange network.