best cryptocurrency exchanges

Edit: This list of cryptocurrency exchanges was updated on January 16, 2019 to include new developments.

Welcome to the most comprehensive and detailed guide to the best cryptocurrency exchanges in 2019. Choosing the best cryptocurrency exchange is an important part of your crypto journey. It might be the first place you ever buy bitcoin. Or if you’re a seasoned trader, you might use a bitcoin exchange to trade hundreds of altcoins.

But how do you differentiate between the options? CoinMarketCap lists at least 100 crypto exchanges all over the world, each tracking cryptocurrency prices and each with varying cryptocurrency exchange rates.

Block Explorer took on the challenge of narrowing down the options and compiling as much information as possible to help you decide. First…

What is a cryptocurrency exchange?

In its simplest form, a crypto exchange is a place to buy and sell cryptocurrencies. However, crypto exchanges are not all equal. Some are designed for beginners, while others have complex features for pro traders.

Some exchanges accept fiat currency like dollars and euros, while others only exchange between cryptocurrencies themselves.

Many are actually “brokers.” In other words, you’re buying directly from the exchange company itself. Others facilitate a real peer-to-peer exchange between crypto users.

best cryptocurrency exchanges

How to choose the best cryptocurrency exchange

We began this task with the aim of ranking the best cryptocurrency exchanges. But we quickly realized this wasn’t possible. There isn’t necessarily a “best exchange,” only the best option for you.

While Coinbase might be the top exchange for beginners, it’s not the best option for a pro trader or someone looking to trade lots of altcoins.

And while the Kraken exchange might be the best option for experts, it’s a poor choice for beginners.

Instead, Block Explorer gathered as much (useful) information as possible taking the following points into consideration:

Beginners or advanced? – We’ve split the entire list into two parts: beginner and advanced. The beginner group includes simple exchanges with easy-to-use functionality. There’s little jargon, and setup times are quick. The second group is for intermediates or advanced users. These exchanges are more powerful and have advanced features, but require some knowledge and experience with crypto.

Security – Crypto exchanges are the single biggest target for hackers. $1 billion was hacked and stolen from cryptocurrency exchanges in 2018 alone. We highlight security features like 2FA, cold storage, and encrypted email options.

Hacked? – We also highlight whether an exchange has been hacked and, if so, how they responded to the hack. Did keep it quiet or immediately inform users? This information is essential in deciding whether to trust your money to an exchange.

Number of trading pairs – We highlight the number of trading pairs available on each exchange. For beginners, a small handful of trading pairs is sufficient (to buy or sell bitcoin, for example). Advanced users, however, may wish to trade between various altcoins.

Volume – Volume is the measure of how much cryptocurrency is trading on the platform on a daily basis. It’s a relatively good indicator of reputation and liquidity.

Important note: Research suggests that some cryptocurrency exchanges fake their own volume in a bid to appear bigger. Where appropriate, we have highlighted the known offenders.

Fees – You should always understand the fee structure before trusting an exchange. How much will each trade cost and how are the fees calculated? We outline the fee structure for each exchange.

Without further ado, here are the best cryptocurrency exchanges in 2019 and beyond.

Please note: Block Explorer has no affiliation with the exchanges listed below.

Best Beginner Exchanges

Beginner exchanges are exchanges that offer a simple way to buy bitcoin and other cryptocurrencies, with as little confusing jargon and setup time as possible.

Coinbase

Coinbase

Trading Type Fiat / Crypto
Number of Trading Pairs 4
Hacked before? No
Available Countries 33
Security Features Two Factor Authentication
30d Volume (Fiat) $82,496,871.00
30d Volume (BTC) $82,496,871.00
Fees Flat 0.5% + a fee based on location and amount

Coinbase is the best-known cryptocurrency exchange in the US. It is the simplest and easiest on-ramp for crypto beginners.

The user interface is intuitive, and the design is clean and simple. You can link up your bank account or pay with a card. There’s also a deep library of guides and explainers for newcomers.

Coinbase has a limited choice of cryptocurrency options to keep things simple. However, they considering the addition of more altcoins.

As for security, Coinbase stores 98% of customer funds in cold storage, in safe deposit boxes and vaults around the world, making it relatively secure. The remaining 2% is insured in case of hacks. 

Lastly, there’s a handy mobile app to buy and sell cryptocurrency on the go.

Get started on Coinbase.

ShapeShift

ShapeShift crypto exchange

Trading Type Crypto / Crypto
Trading Pairs 940+ (Total unknown – each crypto can be traded with any other)
Hacked before? Yes, see below for transparency.
Available Countries Available to all countries
Security Features Two Factor Authentication
24h Volume (Fiat) No USD Trade
24h Volume (BTC) 34.12
Fees No fees applied, profit is made similar to how day trading is profitable.

Shapeshift is a crypto only exchange, which means you can’t buy cryptocurrency with dollars or euros. You can only trade between cryptocurrencies. However, due to its simplicity, we still recommend it for beginners. 

ShapeShift allows you to transfer currency between addresses of your choosing, rather than between accounts on its platform. It means ShapeShift doesn’t hold any customer deposits, making it relatively safe. 

ShapeShift has been hacked three times, which all occurred in the same month due to internal sabotage. The exchange was extremely transparent in what happened over the hack, with the CEO going so far as to write a blow-by-blow explanation of what exactly happened.

Get started on ShapeShift.

Gemini

Gemini bitcoin exchange

Trading Type Both Crypto / Crypto and Fiat / Crypto
Trading Pairs 9
Hacked before? No
Available Countries 15
Security Features Two Factor Authentication, withdrawal address whitelisting
30d Volume (Fiat) $19,134,737.00
30d Volume (BTC) 4,887.00
Fees Maker / Taker: Minimum 0.0% / 0.05%, Maximum 1.0% / 1.0%. Calculated on a 30-day rolling window

Gemini was founded by the Winklevoss Twins. It’s a US-based exchange noted for being a licensed platform (Regulated by NYSDFS). Gemini gained headlines earlier this year by announcing full insurance coverage for funds on its exchange and in custody.

Gemini and the Winklevoss Twins pride themselves on being fully compliant and working within existing regulations. As such, there’s a decent amount of safety from fraud and insurance coverage on this exchange. Of course, that comes at a cost: handing over a lot of personal information.

Gemini offers a decent chunk of volume, though few trading pairs compared to other exchanges. Security wise, aside from the standard 2FA, withdrawal address whitelisting is a welcome sight.

The Gemini app is also slick and easy-to-use for beginners.

Get started on Gemini.

Changelly

Changelly bitcoin exchange

Trading Type Both Crypto / Crypto and Crypto / Fiat
Trading Pairs 200+ (Total unknown)
Hacked before? No
Available Countries All countries accepted for Crypto / Crypto trades
Security Features Two Factor Authentication
30d Volume (Fiat) Not Published
30d Volume (BTC) Not Published
Fees Flat 0.5% fee

Changelly is a crypto exchange similar to ShapeShift. It is address-to-address so Changelly never holds your funds.

There’s a simple frontend for buying bitcoin and converting it to whatever cryptocurrency you would like. Much like ShapeShift, changelly transfers happen between addresses you own, rather than between accounts that the exchange controls.

It’s super fast and efficient. There’s a mobile app too for making transactions on the go.

Get started on Changelly.

Luno

Luno buy bitcoin exchange

Trading Type Fiat / Crypto
Trading Pairs 5
Hacked before? No
Available Countries 40
Security Features Two Factor Authentication
30d Volume (Fiat) $3,140,452.00
30d Volume (BTC) 805.06
Fees Maker / Taker. Makers are a flat 0% and takers range from 0.20% to 1.0%

Luno offers a great platform for African and European traders looking to get started. Alongside their exchange, Luno offers a wallet service with a companion mobile app. The exchange has been around since 2013 and has never been hacked, giving it a fairly solid reputation for security.

It’s designed to be as simple as possible, including an “instant buy” feature.

Get started on Luno.

Coinmama

Coinmama bitcoin exchange

Trading Type Fiat / Crypto
Trading Pairs 16
Hacked before? No
Available Countries 226
Security Features Two Factor Authentication
30d Volume (Fiat) Not Published
30d Volume (BTC) Not Published
Fees 5.9% flat fee with an additional 5% for credit card purchases

Coinmama is a good choice for those looking to buy crypto using a credit card or other fiat sources. Coinmama is a broker so you’re buying directly from the company itself which makes transactions fast.

However, there are some things to be aware of. Coinmama is “buy only” so you cannot sell cryptocurrencies on the platform. There is also no wallet feature on the exchange, so you need to withdraw directly to a wallet. This is no bad thing as keeping your funds on an exchange is risky, but you will need a wallet set up first.

Unfortunately, Coinmama’s simplicity is offset by the incredibly high fees charged for every transaction – 5.9% flat fee and an additional 5% for credit card purchases.

Get started on Coinmama.

Best Intermediate-Advanced Crypto Exchanges

Advanced exchanges offer a lot more information and power to the trader. Unlike simpler exchanges that give you a set price, advanced exchanges allow you to control your buy and sell orders. Meaning that you can choose to create orders at whatever price you want.

Some advanced crypto exchanges also offer pro features like margin and leveraged trading. Some allow you to bet against crypto prices by “shorting” an asset, and most have expert charting tools. Most allow you to trade between cryptocurrencies, where many of the beginner exchanges do not.

Binance

binance crypto exchange

Trading Type Crypto / Crypto
Trading Pairs 100+
Hacked before? No
Available Countries Any not on UN sanction lists
Security Features Two Factor Authentication, client-side account freezing
30d Volume (Fiat) $695,837,008.00
30d Volume (BTC) 180,701.00
Fees 0.1% flat fee

Launched in 2017, Binance quickly grew to become one of the largest cryptocurrency exchanges on the planet.

Binance offers hundreds of crypto trading pairs so it’s perfect if you’re looking to get into some of the more obscure altcoins out there. It is crypto-to-crypto only, so you’ll have to load up your account with bitcoin or ethereum to get started; there’s no fiat currency option.

Edit: On January 16th, Binance launched Binance Jersey – a fiat-to-crypto exchange which allows buyers in the UK and Europe to trade with pounds and euros. 

There’s a “basic” exchange mode and an “advanced” mode, although even the basic mode requires some understanding of trading screens and cryptocurrency. Originally based in China, Binance has relocated to Malta after crypto crackdowns in China and Japan.

The 0.1% flat fee makes Binance a very competitive option.

Get started on Binance.

Kraken

Kraken exchange

Trading Type Both Fiat / Crypto and Crypto / Crypto
Trading Pairs 72
Hacked before? No
Available Countries All but 7 countries
Security Features Two Factor Authentication, with the option for an additional recovery factor, PGP based email encryption and verification
30d Volume (Fiat) $92,208,762.00
30d Volume (BTC) 23,568.00
Fees Per currency Maker / Taker, low end around 0.0% / 0.25%

Based in the US and operating in Canada, Kraken is a large scale cryptocurrency exchange that serves almost the entire planet.

The Kraken exchange was recently crowned the most secure cryptocurrency exchange by cyber-security firm Group-IB. Kraken was the only exchange in the report’s top-tier group, essentially putting it in a security league of its own.

The report cited Kraken’s proof of reserves audits, private key storage, protection of customer data, and technical security details as key reasons for the ranking.

Among Kraken’s security features is the ability to have a second 2FA set up for account recovery, and the ability to use PGP to encrypt and verify email communication.

In terms of trading, Kraken offers 72 trading pairs and leveraged margin trading on bitcoin.

Get started on Kraken.

Coinbase Pro

CoinbasePro crypto exchange

Trading Type Both Fiat / Crypto and Crypto / Crypto
Trading Pairs 25
Hacked before? No
Available Countries 31
Security Features Two Factor Authentication
30d Volume (Fiat) $93,599,262.00
30d Volume (BTC) 23,904.00
Fees Maker / Taker based on the last 30 days in a rolling window. Maker fee is always 0%, taker goes from 0.30% to 0.10%

Coinbase Pro is Coinbase’s bigger (but younger) sibling. It was recently known as GDAX until it changed to Coinbase Pro. The platform offers some very competitive low-end fees, meaning that if you expect to move a lot of crypto they are a good choice.

It comes with all the reputational clout of Coinbase, with its FDIC insurance and regulatory checklist. Coinbase Pro also features additional trading pairs not currently available on the basic Coinbase platform.

Coins like Golem (GNT), Decentraland (MANA), 0x (ZRX), and Basic Attention Token (BAT) are all available on Coinbase Pro, but not Coinbase.

Get started on Coinbase Pro.

Poloniex

Poloniex cryptocurrency exchange

Trading Type Both Crypto / Crypto and Fiat / Crypto
Trading Pairs 116
Hacked before? Yes, see below
Available Countries All but three countries and a few US states
Security Features Two Factor Authentication
30d Volume (Fiat) $27,719,009.00
30d Volume (BTC) 7,764.00
Fees Maker / Taker. Minimum 0.0% / 0.1%, Maximum 0.1%, 0.2%

Poloniex is a relatively large cryptocurrency exchange based in the USA. Poloniex offers a pretty large amount of volume on its platform and backs it up with competitive fees. A good choice for any trader looking to move mid-to-large amounts of crypto.

Poloniex’s backend has been hacked once. After it happened the then-CEO was transparent, and promised that Poloniex would cover any losses, and discussed exactly how the hack took place.

The vast majority of funds are kept in “air-gapped cold storage” and suspicious activity is monitored closely.

As for trading, Poloniex offers one of the most advanced suite of trading tools and technical indicators. It was the first exchange to offer pre-fork trading on the two Bitcoin Cash protocols, providing a crucial gauge of investor support.

Get started on Poloniex.

Bittrex

Bittrex cryptocurrency exchange

Trading Type Both Crypto / Crypto and Fiat / Crypto
Trading Pairs 288
Hacked before? No
Available Countries Almost all
Security Features Two Factor Authentication, IP and cryptocurrency address whitelisting, and client-side account freezing
30d Volume (Fiat) $42,818,083.00
30d Volume (BTC) 11,080.00
Fees 0.25% flat fee on all trades

Bittrex is a crypto exchange with decent volume, a good number of trading pairs, and above average security options. Specifically, the ability to whitelist IPs that can access your account and addresses you can withdraw to is very handy.

The exchange has never been hacked, which is the least you should expect from an exchange founded by three cybersecurity engineers! The vast majority of funds are stored in safe cold storage wallets.

Bittrex is designed for experienced traders, built with a scalable trading engine which executes orders in seconds. The flat 0.25% fee means you always know where you stand, too.

Get started on Bittrex.

Bitfinex

Bitfinex cryptocurrency exchange

Trading Type Both Crypto / Crypto and Fiat / Crypto
Trading Pairs 100
Hacked before? Yes – Not that much response from Bitfinex
Security Features Almost all, none that are listed on UN sanctions
Available Security Two Factor Authentication or Universal Second Factor (Yubikey or similar), IP whitelist for accounts, PGP encrypted email
30d Volume (Fiat) 311
30d Volume (BTC) $311,032,908.00
Fees Maker / Taker based on your last 30 days volume. Maximum 0.1% / 0.2%, Minimum 0.0% / 0.055%

Bitfinex is a Hong Kong-based cryptocurrency exchange with expert-level features like spot trading and leveraged margin trading. You can leverage up to 3.3x (effectively borrowing money to increase your position). 

The charts on Bitfinex are particularly great, allowing to set your own patterns and set price alerts. The exchange also has high liquidity and large volume, meaning you can buy and sell without lag time.

Bitfinex was hacked in 2016 with $72 million worth of bitcoin stolen, but the exchange now has above-average security options. Specifically, the inclusion of U2F and PGP encryption for email is a welcome sight.

One thing we should note is that Bitfinex has been accused of artificially pumping bitcoin prices during the 2017 bull run.

Get started on Bitfinex.

Bitstamp

Bitstamp bitcoin exchange

Trading Type Both, though mostly Fiat / Crypto
Trading Pairs 14
Hacked before? Yes, employees’ credentials compromised. Bitstamp released an incident report, but it is no longer available.
Available Countries 56 for MasterCard transactions, no information otherwise.
Security Features Two Factor Authentication, a PGP key is offered for email encryption and email-based withdrawal confirmations.
30d Volume (Fiat) $93,538,791.00
30d Volume (BTC) 24,205.00
Fees Based on your last 30-day volume in USD. Ranges from 0.25% to 0.10%

Bitstamp started out in a garage, with $1,000 and two laptops in 2011. Fast forward to today, and it’s one of the largest cryptocurrency exchanges in the world.

Based in London, it’s an ideal option for British crypto traders. Bitstamp was one of the first fully-licensed digital cryptocurrency exchanges. That didn’t stop hackers in 2015 stealing $5 million from the exchange. The company did release an incident report to explain the situation, but it is no longer available.

Since then, it has implemented some strong security features. Namely, PGP encrypted communication and email based withdrawal confirmations stand out here. PGP is a must to verify the identity of who you are communicating with.

Get started on Bistamp.

Bithumb

bithumb cryptocurrency exchange

Trading Type Fiat / Crypto (specifically Korean won)
Trading Pairs 66
Hacked before? Yes
Available Countries All countries, though still only in KRW
Security Features Two Factor Authentication
30d Volume (Fiat) $1,419,838,544.00
30d Volume (BTC) 367.00
Fees Flat 0.15% fee

Caution: A recent report found evidence of wash trading on Bithumb – a manipulative practice to exaggerate its volume figures.

According to CoinMarketCap, Bithumb is the largest exchange by reported volume (at the time of writing). But there’s a catch – the only fiat option available is Korean won (KRW).  

Bithumb is open to all countries, but traders without a connection to South Korea will struggle to trade, as it is notoriously difficult to buy and sell KRW for other fiat currencies. Though this does leave an opening to buy KRW with crypto, assuming you have the crypto-side capital for it.

Bithumb has been hacked at least twice – first in June 2017 hitting 3% of all Bithumb users. And secondly, in June 2018, when $31 million was stolen from the exchange.

Get started on Bithumb.

CEX.io

Cex.io bitcoin exchange

Trading Type Both Crypto / Crypto and Crypto / Fiat
Trading Pairs 28
Hacked before? No
Available Countries All countries aside from 24 small countries and 27 States
Security Features Two Factor Authentication
30d Volume (Fiat) $7,056,167.00
30d Volume (BTC) 1,827.00
Fees Maker / Taker based on your last 30 days volume in BTC. Maximum fee of 0.16% / 0.25%, minimum fee of 0.0% / 0.1%

CEX.io is a UK based cryptocurrency exchange that sports a low but respectable volume and very competitive fees.

It offers an impressive dashboard for expert traders with margin trading, order-matching algorithms, and high-frequency trading for scalp traders.

It’s a good choice assuming what you are looking to trade is available in their somewhat small pool of trading pairs. 

Get started on CEX.io.

Bitpanda

bitpanda crypto exchange

Trading Type Fiat / Crypto
Trading Pairs 80
Hacked before? No
Available Countries All for buy / sell via Neteller, otherwise EU only
Security Features Two Factor Authentication, email confirmation for most account actions
30d Volume (Fiat) Not Reported
30d Volume (BTC) Not Reported
Fees Change often – Between 1% and 3%

Bitpanda is an Austrian cryptocurrency exchange and one of the most accessible options for traders in Europe. Bitpanda acts as a broker, meaning you’re purchasing the cryptocurrency from Bitpanda itself, rather than exchanging it with other users.

Bitpanda accepts euros, British pounds, Swiss francs, and US dollars and offers a decent array of cryptocurrencies. It has a slick user interface that is welcoming and relatively intuitive for users.

The only downside here is that their fees are somewhat high and they don’t report volume.

Get started on Bitpanda.

Coinsquare

Coinsquare crypto exchange

Trading Type Fiat / Crypto (Specifically CAD)
Trading Pairs 9
Hacked before? No
Available Countries 1 – Canada only
Security Features Two Factor Authentication
30d Volume (Fiat) $7,058,585.00
30d Volume (BTC) 1,804.00
Fees Flat fee for makers and takers, 0.10% and 0.20% respectively

Coinsquare is the largest cryptocurrency exchange in Canada, built to cater directly to Canadian traders, meaning that external traders will find themselves falling flat. Security, however, is a high priority. Coinsquare has never been hacked and 95% of all funds are held in cold storage. 

Its trading functionality is somewhat basic, so experts will probably look elsewhere for superior features. 

Get started on Coinsquare.

HitBTC

HitBTC cryptocurrency exchange

Trading Type Crypto / Crypto
Trading Pairs 803
Hacked before? No
Available Countries Almost all
Security Features Two Factor Authentication
30d Volume (Fiat) $222,941,259.00
30d Volume (BTC) 57,732.00
Fees Flat Maker / Taker fee structure: -0.01% / 0.1%

Caution: A recent report found some evidence of wash trading on HitBTC – a manipulative practice to exaggerate its volume figures. If correct, only 25% of reported trading volume on HitBTC is real.

HitBTC is a Chile-based cryptocurrency exchange that calls itself “the most advanced bitcoin exchange.” HitBTC offers incredibly competitive fees, a high amount of volume, and a good number of trading pairs. 

Unlike most other cryptocurrency exchanges, HitBTC offers a rebate for makers in their fee structure, meaning that makers receive 0.01% of the trade amount as a credit when a trade is made.

In terms of security, HitBTC offers 2-factor authentication, encryption technology, and cold storage. A 24-hour support team is also a nice touch.

However, the reports of manipulative wash trading should be taken into account before trading here.

Get started on HitBTC.

OKEx

OXEx crypto exchange

Trading Type Crypto / Crypto
Trading Pairs 412
Hacked before? No
Available Countries Accepts all countries
Security Features Two Factor Authentication
30d Volume (Fiat) $567,722,732.00
30d Volume (BTC) 146,920.00
Fees Complex Maker / Taker scheme

Caution: A recent report found evidence of wash trading on OKEx – a manipulative practice to exaggerate its volume figures. If correct, only 11% of reported trading volume on OXEx is real.

OKEx is a Hong Kong-based cryptocurrency exchange that offers a massive number of trading pairs with an equally large amount of liquidity to back it up.

OKEx was rated Crypto Exchange of the Year at last year’s Malta Blockchain Awards.

However, in a recent investigation, OKEx was considered “completely uninsurable” and ranked in the lowest bracket for security. Additionally, OKEx was singled out for manipulating its volume. A recent report found evidence of wash trading on at least 30 of its trading pairs.

Another downside here is a complex fee structure.

Get started on OKEx.

Conclusion

There are lots of factors to consider when picking the right crypto exchange: ease of use, security features, reputation, trading pairs and trading tools. Remember, when signing up to an exchange, you are trusting them with your funds. Always do your due diligence before you transfer any money.

Learned something new? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.

Ripple XRP

Euro Exim Bank will be the first bank to use Ripple’s cryptocurrency service xRapid. The London-based bank will actively use XRP to source liquidity and settle cross-border payments.

It’s a major development for Ripple. As reported by Block Explorer, a handful of Ripple’s partners in the finance world now use xRapid, but most are money-transfer services. None have a banking license. 

Euro Exim Bank is the first official bank to flip the switch to xRapid.

What is xRapid?

xRapid is Ripple’s flagship service that uses XRP as a bridge currency to speed up cross-border payments.

Tests have reported 70% savings and almost instantaneous settlements.

xRapid is a solution to the outdated foreign exchange system which takes days and incurs high fees.

Learn more: What is xRapid (Everything You Need To Know About Ripple’s Crypto Service)

While Ripple now has more than 200 banking partners, only a few are actively using xRapid. The companies include Mercury FX, Cuallix, Catalyst Corporate Credit Union, and Viamericas. 

“Dozens of banks” will be using xRapid by the end of 2019

Ripple CEO Brad Garlinghouse has previously boasted that “dozens of banks” will be using xRapid by the end of 2019. But XRP holders have been disappointed by the lack of fully-licensed banks switching over to the cryptocurrency service.

Alongside the Euro Exim announcement, Garlinghouse also revealed that four additional companies will tap into xRapid: JNFX, SendFriend, Transpaygo, and FTCS.

“We’re beginning to see more customers flip the switch and leverage XRP”

During the announcement Garlinghouse expanded on Ripple’s progress: 

“In 2018, nearly 100 financial institutions joined RippleNet, and we’re now signing two—sometimes three—new customers per week. We also saw a 350 percent increase last year in customers sending live payments, and we’re beginning to see more customers flip the switch and leverage XRP for on-demand liquidity. At the end of the day, our goal is to make sure our customers can provide excellent, efficient cross-border payments experiences for their customers, wherever they are in the world.”

Euro Exim Bank director, Kaushik Punjani, said: “We have designed, tested and are implementing both xCurrent and xRapid in record time, and we look forward to the benefits these will bring our customers.”

Further reading: What is Ripple XRP (Absolutely Everything You Need to Know)

proof of keys

Proof of Keys is a new movement that encourages all crypto users to withdraw their funds from centralized exchanges like Coinbase, Gemini, and others.

Initiated by investor Trace Mayer, the first ever Proof of Keys event will take place on 3rd January 2019 – the anniversary of the bitcoin genesis block – with a view to establishing an annual tradition.

To participate in the Proof of Keys movement, you simply need to withdraw any crypto you hold on an exchange and store it safely in a personal crypto wallet where you control the private keys instead.

Why Does Proof of Keys matter?

There are two main reasons for removing your crypto from exchanges on Proof of Keys day:

  1. To ensure cryptocurrency exchanges actually have the funds they claim. If everyone withdraws their crypto funds on the same day, crypto exchanges will be forced to pay out. If they fail to do so, it’s a huge red flag for exchanges that claim to store your money safely.
  1. To take control of your own crypto. As Andreas Antonopoulos said: not your keys, not your bitcoin. If all your bitcoin is stored on a crypto exchange, you don’t actually own the private keys; the exchange does. That means you’re not in control of your bitcoin or other cryptocurrencies.

Protect Against Hacks and Centralization

If you leave your funds on a cryptocurrency exchange, it’s much more vulnerable to hacks. $1 billion in crypto was stolen in 2018; the vast majority from crypto exchanges.

Exchanges are huge targets for hackers because they store vast amounts of crypto in one place. Instead, move your crypto to a personal wallet where it is much less vulnerable.

As Block Explorer previously reported, at least 25% of all litecoin in circulation is held by Coinbase. That’s a dangerously large amount of litecoin stored in one place. Not only that, but Coinbase technically owns all that litecoin; not you the depositor.

Proof of Keys is a, therefore, a practical and philosophical movement.

How to move your funds off an exchange

To withdraw funds, you’ll first need a wallet and a corresponding address.

The safest option is a hardware wallet from Ledger, Trezor or KeepKey. These are similar to external hard drives designed specifically for crypto storage. Since they’re offline most of the time, they’re difficult to hack (known as “cold storage”).

There are other wallet options that give you full control of your private keys including software desktop wallets and simple paper wallets.

Want more information? 12 best bitcoin wallets for safe and secure crypto storage

Once you have your wallet address, simply withdraw funds from the exchange to the wallet address.

Be aware that there may be high transaction volume on January 3rd which may cause congestion. You should also test the wallet address by sending small amounts of crypto to the wallet first.

Crypto Curious? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.

worst-performing cryptocurrencies 2018

It’s been a brutal year for crypto, but which are the worst cryptocurrencies? After the boom of 2017, the whole crypto market is in the red. Some projects are on the verge of bankruptcy while others are taking drastic measures such as cutting staff and re-organizing. 

However, some cryptocurrencies have performed worse than others. Here, we rank the ten worst-performing cryptocurrencies of 2018 and look at some of the reasons for their poor performance.

Worst-Performing Cryptocurrencies, Criteria: 

  • This list only includes coins in top 100 by market capitalization, thereby excluding lower-ranked altcoins. 
  • We exclude all stablecoins pegged to another asset, such as Tether, PAX, and Dai.
  • We exclude any project that hasn’t been around for at least six months.
  • All prices sourced from CoinCodex, tracked from January 1st, and ranked by percentage fall in market capitalization. 
  • All prices correct at time of publishing (10th December, 2018).

10. Bitcoin Cash (BCH) -95.5%

Bitcoin Cash suffered a disastrous end to the year after a contentious hard fork split the community. A vicious war of words broke out between the two sides and miners went to war. The blockchain ultimately split in two, spawning a new cryptocurrency, Bitcoin Cash SV. The controversy had a wholly negative impact on the value of BCH which has dropped 95.5% this year.

Further reading: Everything You Need to Know About the Bitcoin Cash Fork

Bitcoin Cash price chart 2018

9. Elastos (ELA) -95.58%

Elastos (ELA) is a cryptocurrency that aims to be used as part of the first completely safe and decentralized infrastructure for the internet. According to comments on various social media channels, here are some negative things to note about ELA. The inflation rate is too high, not many exchanges list this crypto, and specialized hardware (Elastos server) is needed to run applications. As of late 2018, there also isn’t support for ELA on major hardware wallets like Trezor and Ledger.

Elastos price chart 2018

8. ICON (ICX) -96.08%

ICON (ICX) launched with the goal to “hyperconnect the world” and “enrich our everyday lives through ‘connection’”. This is one of many projects aiming to improve blockchain interoperability. AION, Wanchain, and ARK are considered by many to be ICON’s top competition. 

Thus far, there have been a few relevant criticisms of the project. For example, after the mainnet launch in January 2018, the token swap was a slow process that dragged on all the way into late October 2018. Although the project has been in development for two years, the website still doesn’t have a proper roadmap listed.

ICON price chart 2018

7. Verge (XVG) -96.35%

Verge (XVG) announced a big partnership with PornHub in April 2018; however, this hasn’t had a positive impact on prices long-term. The biggest issue for this project in 2018 has been the constant 51% attacks. Although security issues have affected a number of exchanges and blockchains this year, Verge’s security woes are some of the most reported in crypto, and for good reason. 

In May 2018, one attack alone affected over 35 million coins in around five hours. The hacker stole around $1.8 million in XVG. While other projects that have suffered from 51% attacks, XVG has clearly been the most impacted this year. 

Verge price chart 2018

6. Populous (PPT) -96.69%

Populous Platform Token (PPT) is a cryptocurrency for Populous’ smart contract invoice finance platform, which runs on the Ethereum & RSK blockchains. There appears to have been a number of issues with the project’s technical features throughout 2018. For example, users of the beta version of the platform received error 502 and faced other problems. Therefore, many found it difficult to test the platform’s functionality. 

Another common criticism is a lack of responsiveness from the project team to questions from the community. As this article points out, this issue was also prevalent in 2017. The Telegram channel account owner has been inactive since July 2017, and this platform only had around 1,300 members.

PPT price chart 2018

5. Ardor (ARDR) -96.86%

Ardor (ARDR) is a cryptocurrency designed specifically for business applications. Looking at the project website, the Ardor platform itself is being developed for blockchain-as-a-service purposes. This project evolved from the Nxt blockchain, the first Proof-of-Stake consensus network. Ardor also features a unique parent-child chain architecture. 

Compared to others on this list, there doesn’t seem to be too many negatives regarding this project in 2018. Despite some wallet and network issues earlier in the year, it’s tough to pinpoint the exact cause of ARDR price declines. Perhaps the biggest issue (as with many blockchain projects) is that the tech is still underdeveloped.

Ardor price chart 2018

4. Bitcoin Diamond (BCD) -97.11%

Bitcoin Diamond (BCD) raises a few potential red flags for some people. For instance, its two main developers go by the pseudonyms “007″ and “Evey”, and source code isn’t available. Regardless, BCD aims to reduce transaction fees and completion times. Compared to BTC, BCD has larger block sizes, a higher total supply, and simplified mining processes. 

According to the first Weiss Cryptocurrency Ratings released in April 2018, BCD and a few other Bitcoin hard forks are merely copycats. While this report does highlight some of the positives of these new cryptocurrencies, it notes that BTC being the first-mover does take away some momentum from projects like BCD.

Further reading: 5 Failed Bitcoin Forks that Never Made It

Bitcoin diamond price chart 2018

3. Bitcoin Private (BTCP) -97.26%

Bitcoin Private (BTCP), as the name suggests, provides the possibility of private transactions. If you’re well-versed on cryptocurrencies, you know that BTC isn’t really anonymous. That’s why BTCP was created as a merge fork of Bitcoin and ZClassic. BTCP aims to compete with Verge, Monero, and other privacy coins. 

Earlier in 2018, a big discussion on the BTCP subreddit surrounded the lack of listings from top exchanges. Since then, low liquidity trading and conflicts within the team and community have all continued to be major issues. Still, it’s important to note that BTCP is one of the newer projects (launched in March 2018), in the top 100 market cap rankings.

Bitcoin Private price chart 2018

2. Qtum (QTUM) -97.36%

Qtum (QTUM) is another project that aims to become a leader in the smart contract market. The project made significant progress after its ICO ended in March 2017. The testnet launched only three months later. 

The mainnet launched three months after the testnet release, very quick when compared to the vast majority of blockchain projects. The issue seems to be that Qtum’s competition has implemented better technology, at least as of late 2018. According to one article, Aion and ICON are both ahead of Qtum. There are also other competitors to consider like Ethereum, NEO, Zilliqa, and many more.

Qtum price chart 2018

1. Aion (AION) -97.57%

Aion (AION) is a third generation blockchain project that (as mentioned above) competes with ICX and others by focusing on increasing interoperability between various chains. Some potential use cases listed on the project website include supply chain logistics, Internet-of-Things, online media marketplace, fundraising, and digital identities. 

As with Ardor, Aion doesn’t seem to have faced too many major issues in 2018. Nonetheless, some people have said that the project is too ambitious and it finds itself with the biggest percentage drop in market cap of 2018.

Aion price chart 2018

Conclusion

After the euphoria of 2017 and the rapid growth of altcoins, this year has been tough for cryptocurrency projects. It has been predicted that most altcoins will “go to zero,” but can the projects on this list turn it around next year? Join us tomorrow for our run-down of the best performing cryptocurrencies of 2018.

Crypto Curious? Subscribe to the Block Explorer newsletter to get exclusive crypto insights before they appear on the site.

What is Ripple?

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?

Contents:

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.

Ripple vs XRP differences infographic
Source: Ripple . Note: although Ripple refers to XRP as an “independent asset” above, some disagree with this classification. We’ll get into this shortly.

Got It. So What Is Ripple (The Company?)

david schwartz“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.

XRP speed vs Bitcoin and Swift

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.

how xrp works diagram

 

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.

brad garlinghouse“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.

Brad Garlinghouse is the current CEO of Ripple and David Schwartz is CTO.

Ripple history infographic
Credit: buyripple.com

PART 2: Understanding the Ripple Blockchain

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 system is called “proof of work.”

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.

XRP Ledger consensus-rounds diagram

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.

xrp-ledger-network diagram

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.

XRP speed vs bitcoin and ethereum

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.

Ripple bank partnerships logos

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.

Ripple xCurrent

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 xRapid

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?

Like XRP…

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:

Centralization

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.

XRP logo

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.”

Critics point out, however, that the same registered company that became Ripple Labs also created the XRP token.

Is XRP a Security, Not Currency?

There’s an argument that XRP should be classified as a “security” (like a company stock) not a currency.

Critics say that if XRP was created by Ripple, and a majority is held by the company, it shouldn’t be classified as a currency.

Ripple is currently battling a lawsuit over this issue. The lawsuit argues that Ripple has misled people to expect a return from their XRP investment.

Ripple has denied that XRP is a security, saying: “We’re 100 percent clear, it’s not a security. We don’t meet the standards.”

The US Securities and Exchange Commission (SEC) has yet to make a decision about XRP’s status. The SEC has indicated that bitcoin and ethereum are not securities. But they’re still quiet about XRP.

If XRP is deemed a security, Ripple will be subject to much stricter regulations and requirements.

So, is Ripple Centralized?

In the most recent statement on the issue, Ripple CEO Brad Garlinghouse said:

“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 logo

Why not?

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:

1. Buy XRP Directly From a Participating Exchange

Exchanges that facilitate US dollar transfers include Bittrex, Bitfinex, Kraken, BitStamp, Bitsane, Gatehub, CEX.io.

Simply create an account at one of these exchanges and exchange USD directly for XRP.

BittrexLogo_Color

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. (Binance is perhaps the best known, but there are many others out there).

Binance-logo

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.

binance deposit

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.

ledger nano cold storage bitcoin wallet plugged into a laptop

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.

Ripple calls this the 800-pound gorilla in the room.

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.

Xpring

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.

Conclusion

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.

Watch this space.

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