What is XRP? A plain guide to the cryptocurrency
XRP is a digital asset for payments on the XRP Ledger. A 2023 ruling said the XRP token is not a security, and SEC approved spot XRP ETFs in 2025.
Vahe HakobyanEditor-in-chief
Updated Oct 5, 20263 min readFact-checked
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- XRP was created upfront, not mined.
- Ripple is a company; XRP is the asset.
- A 2023 ruling said the XRP token is not a security.
XRP is not Ripple, the company that builds payment software for banks. The founders created the asset before Ripple existed. The XRP Ledger confirms payments through consensus, and XRP pays fees.
How does the XRP Ledger work?
The XRP Ledger is a cryptocurrency platform launched in 2012. It uses consensus, not mining, and independent validators confirm transactions every few seconds. XRP pays each transaction fee.
- Consensus is not proof of work or proof of stake
- Validators confirm transactions every few seconds
- XRP pays transaction fees and a little XRP is burned
What is XRP used for?
People send XRP between accounts, and it pays fees on the ledger. Ripple says financial institutions can use XRP as a bridge asset among fiat currencies to cut liquidity costs. That claim is Ripple's own description.
Who created XRP and who runs Ripple?
Jed McCaleb, Arthur Britto and David Schwartz built the XRP Ledger in 2011 and 2012. In September 2012, McCaleb and Britto, with Chris Larsen, formed Ripple, then called OpenCoin Inc., and Ripple later received a large share of XRP.
- Ripple is a company, not the XRP asset
- The XRP Ledger is also called the Ripple Protocol
- Ripple develops on the XRP Ledger
How is XRP different from bitcoin and ether?
XRP was pre-mined, so no new XRP is mined. Bitcoin releases new coins through mining on the Bitcoin blockchain, ether is issued under proof of stake, and most stablecoins are issued by companies and pegged to a fiat currency.
What legal issues has XRP faced?
The SEC sued Ripple in December 2020, arguing that its XRP sales broke securities law. On July 13, 2023, Judge Analisa Torres ruled that the XRP token itself is not a security, and in November 2025 the SEC approved the first wave of spot XRP ETFs. That ruling came in one case, so it did not settle how XRP sales are treated nationwide.
Frequently asked questions
In a wallet that supports the XRP Ledger. On an exchange, the exchange holds the keys.
It supports payment channels and a small built-in exchange, but not general smart contracts.
No new XRP is mined. Ripple releases escrowed XRP over time under a schedule set in 2017.
XRP runs on the XRP Ledger, which independent validators keep running. It would survive without Ripple.
