XRP is a payments-focused crypto asset built to move money across borders in seconds for a fraction of a cent. It is also one of the most divisive: a fast, efficient ledger paired with heavy Ripple Labs involvement, a huge pre-mined supply, and a landmark US lawsuit. This review explains what XRP actually is, how the ledger works, the supply overhang, where the legal fight stands, and how to buy and store it.
What is XRP?
XRP is a digital asset that runs on the XRP Ledger (XRPL), a public blockchain designed specifically for fast, low-cost payments and currency exchange. It was created by Ripple Labs, a San Francisco fintech company, and first issued in 2012. The founding team, including Jed McCaleb and Chris Larsen, pre-mined the entire supply of 100 billion XRP at genesis and later transferred the majority to Ripple Labs.
Where Bitcoin is built as a store of value and Ethereum as a smart-contract platform, XRP’s primary purpose is cross-border settlement: letting financial institutions and payment providers move value between currencies in seconds rather than days.
How the XRP Ledger works
The XRPL reaches consensus through the XRP Ledger Consensus Protocol, which relies on a network of trusted validators rather than miners or staked validators. Each node maintains a Unique Node List (UNL) of validators it trusts, and transactions confirm when a supermajority of those validators agree.
This makes the ledger very fast, with transactions typically confirming in 3 to 5 seconds, and highly energy-efficient compared with proof-of-work chains.
| Property | Detail |
|---|---|
| Total supply | 100,000,000,000 XRP (fixed at genesis) |
| Consensus | XRP Ledger Consensus Protocol |
| Transaction speed | About 3 to 5 seconds |
| Transaction fee | A fraction of a cent, and the fee is destroyed |
| Escrow held by Ripple | Tens of billions of XRP released gradually |
Supply structure and escrow
Because all XRP was pre-mined, there is no ongoing issuance through mining or staking. But Ripple Labs controls a large portion of the supply. In 2017, Ripple placed roughly 55 billion XRP into a series of smart-contract escrows that release up to one billion XRP per month. Ripple can sell released XRP or return unused portions to escrow for later.
Critics see this as a significant overhang on price: a commercial entity can systematically sell into the market, diluting existing holders. Supporters argue the escrow makes the release schedule transparent and predictable. Both points are fair, and it is the single biggest structural factor to understand about XRP.
The SEC litigation
In December 2020, the US Securities and Exchange Commission sued Ripple Labs, alleging XRP was an unregistered security. The case became one of the most closely watched in crypto legal history.
In mid-2023, a federal judge issued a partial ruling: XRP sold to retail investors on exchanges was not a security, while XRP sold directly to institutions by Ripple was. Both sides appealed aspects of the decision, and settlement discussions ran into 2025 and 2026. The outcome meaningfully affects XRP’s legal standing in the United States and its availability on US exchanges, so check the current regulatory status in your jurisdiction before buying.
Pros and cons
Strengths
- Very fast finality, around 3 to 5 seconds, with extremely low transaction costs.
- Strong institutional partnerships in payments and remittances.
- Deep liquidity, consistently a top-10 asset by market capitalisation.
- An energy-efficient consensus model.
Risks
- Ripple’s large escrow creates long-term selling pressure.
- Ongoing regulatory uncertainty in the US despite partial court victories.
- A more centralised validator model than Bitcoin or Ethereum.
- XRP’s value is tied to Ripple’s commercial success, making it more like a company-affiliated token than a fully decentralised asset.
Where to buy and store XRP
XRP is available on most major exchanges, though US availability has historically been affected by the SEC case. Outside the US, Binance, Kraken, and many regional exchanges list XRP pairs with strong liquidity. In the US, Coinbase reinstated XRP trading after the 2023 partial ruling. Check current availability before proceeding, and see our how to buy crypto guide if you are new.
For meaningful holdings, move XRP off exchanges:
- Hardware wallets. Both Ledger and Trezor support XRP natively. See our wallets guide.
- Xaman (formerly XUMM). A dedicated non-custodial mobile wallet built for the XRP Ledger.
- Note the XRPL requires a minimum 10 XRP reserve to activate a wallet address. This reserve is locked while the account is active.
Frequently asked questions
Is XRP centralised? More so than Bitcoin or Ethereum. Ripple Labs controls a large portion of the supply through escrow and heavily influences development, though the ledger itself is run by independent validators worldwide. The degree of centralisation is a genuine trade-off to understand before buying.
What happened with the SEC case? A 2023 ruling found retail exchange sales of XRP were not securities, but direct institutional sales by Ripple were. The case continued into 2025 and 2026 with appeals and settlement talks. The legal picture has improved for XRP since 2020, but it is not fully resolved.
What is XRP used for in practice? Beyond speculation, XRP is used in Ripple’s On-Demand Liquidity product, where it acts as a bridge currency in cross-border payments: a sender converts local currency to XRP, transfers it almost instantly, and converts to the destination currency on arrival.
How fast and cheap are XRP transactions? Transactions settle in roughly 3 to 5 seconds and cost a tiny fraction of a cent, with that fee permanently destroyed rather than paid to a validator.