XRP is one of the oldest and most well-known cryptocurrencies. Its journey has been marked by significant legal battles, institutional adoption efforts, and continued development. This guide explains what XRP is and what Indian investors should know.
What is XRP?
XRP is the native digital asset of the XRP Ledger, a blockchain network created by Ripple Labs. The XRP Ledger launched in 2012, making XRP one of the earliest cryptocurrencies after Bitcoin.
XRP was designed specifically for fast, cheap cross-border payments. Key features:
- Transactions settle in 3 to 5 seconds
- Transaction fees are fractions of a cent
- Can handle 1,500+ transactions per second
- Total supply: 100 billion XRP (no mining required)
- Ripple Labs holds a significant amount in escrow
Unlike Bitcoin (Proof of Work) or Ethereum (Proof of Stake), the XRP Ledger uses a unique consensus protocol that does not involve mining. Instead, a network of trusted validators reaches agreement on transactions.
XRP’s Use Case: Cross-Border Payments
XRP was designed to serve as a bridge currency in international payments. Financial institutions can use XRP to:
- Send money across borders faster than SWIFT
- Reduce the need for pre-funded nostro accounts
- Lower the cost of international remittances
Some financial institutions and payment providers have integrated XRP or RippleNet for cross-border transactions.
The XRP vs SEC Legal Case
In December 2020, the US Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs, alleging that XRP was sold as an unregistered security.
In July 2023, a US court ruled that programmatic sales of XRP on exchanges do not constitute securities transactions. This was a partial victory for Ripple. However, some aspects of the case continued.
The case was widely watched globally as it had implications for crypto regulation beyond just XRP. Consult current news sources for the latest status.
Is XRP Legal in India?
Yes. XRP is legal to buy and hold in India as a VDA:
- Gains taxed at 30%
- 1% TDS on qualifying transactions
- Available on ZebPay for INR trading
Risks of Investing in XRP
Issuer concentration: Ripple Labs controls a significant portion of XRP supply. Scheduled escrow releases can create selling pressure.
Regulatory risk: The SEC case raised questions about XRP’s regulatory status globally. India’s own regulatory framework is still evolving.
Centralisation: Critics argue the XRP Ledger’s validator network is not as decentralised as Bitcoin or Ethereum.
Price volatility: XRP has experienced severe bear market drawdowns. Past performance does not guarantee future results.
Always conduct your own research before investing.
How to Buy XRP on ZebPay
- Download ZebPay and complete KYC
- Deposit INR
- Search for XRP in the Markets section
- Buy via Quick Trade (minimum ₹100)
Frequently Asked Questions
Is XRP better than Bitcoin?
XRP and Bitcoin serve different purposes. XRP is designed for payments; Bitcoin is a store of value. Both are high-risk assets. This is not financial advice.
What happened between XRP and the SEC?
In 2023, a court ruled that programmatic XRP sales on exchanges are not securities transactions. The full case involved other aspects. Research the latest developments before investing.
Can I stake XRP?
XRP does not use traditional staking. Check ZebPay’s Earn section for any XRP yield products available.
What is the minimum to invest in XRP on ZebPay?
₹100.
How is XRP taxed in India?
30% on gains, 1% TDS on qualifying transactions. Consult a qualified tax professional.
Final Thoughts
XRP has a clear use case in cross-border payments and a long operating history. Its regulatory journey has been complex but has largely clarified its status as a tradeable asset on exchanges.
Invest with awareness of its risks, especially the issuer relationship and ongoing regulatory environment.
Get started today and join 6 million+ registered users exploring crypto investing on ZebPay!
Disclaimer: Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Each investor must do his/her own research or seek independent advice if necessary before initiating any transactions in crypto products and NFTs. The information in this article is for educational purposes only and does not constitute financial or investment advice.