Ripple is also referred to as the Ripple Transaction Protocol. It is a currency exchange, settlement and remittance system. Ripple uses a distributed open source protocol, ledger and a cryptocurrency called ripples. Ripple is designed to facilitate instant, low cost financial transactions without chargebacks. Like other cryptocurrencies, Ripple utilizes a public database to enable payments and exchanges to be made with a specified process.
Ripple is the company behind the technology. The company previously went by the name Opencoin before changing its name to Ripple Labs in 2015. Ripple is headquartered in San Francisco, California and was founded in 2012. Ripple is the open payment network, while XRP, or “ripples” are the digital assets used for payment, remittance and exchange.
Ryan Fugger originally came up with the concept of Ripple back in 2004. His idea was to create a decentralized monetary system that could enable individuals and even communities to create their own money. Eventually, Fugger built the first version of the system called RipplePay.com.
Eventually, Fugger was approached by Jed McCaleb and Chris Larsen, who had been working on a digital currency system in which transactions were verified by network members instead of the mining process. Fugger eventually handed Ripple over to McCaleb, and he and Larsen founded Opencoin in 2012. Arthur Britto and David Schwartz have also been credited as original authors. Ripple eventually received a virtual currency license in the state of New York, becoming the fourth company to obtain such a license.
Cryptocurrencies have become increasingly popular in recent years, and they could potentially see exponential expansion going forward. Although some merchants already accept various cryptocurrencies as a form of payment, this asset class has barely scratched the surface and is far from being considered mainstream at this point. The massive growth potential of this technology, however, makes it both interesting and potentially viable as a tradeable asset and long-term investment.
For those looking to invest in Ripple for the long-term, a Ripple IRA account may be worth consideration. A Ripple IRA is a self-directed IRA account, in which the holder can purchase various asset classes outside of traditional stocks, bonds or mutual funds. Purchasing Ripple within such an IRA account can have numerous potential advantages. The biggest potential benefit of a Ripple IRA is the potential for tax-deferred growth on any earnings. This means that you can buy and sell Ripple, or hold it as a long-term investment, with any gains being non-taxable until distributions are made provided that all rules and regulations are followed.
A Ripple IRA can also potentially reduce your taxable income now as well. The current limit for a traditional IRA contribution is $5500 for 2017 and 2018. This means that you can invest this amount into an account, and that amount may be tax deductible. Any tax or eligibility questions should be directed to your tax professional.
Cryptocurrencies like Ripple have tremendous potential for more widespread use and acceptance as well as higher Ripple prices. A Ripple IRA may be a great way to participate in this very exciting market. Contact us today to get started.