A new ripple hoax emerged on the crypto news platforms across the internet, saying that there has been an increase in Bitcoin issuance and transactions on the Ripple blockchain.
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Let’s see and find out what happened exactly in the latest Ripple XRP news.
Despite the high transaction speed and low fees, Ripple is not the preferred layer 2 for Bitcoin. There was a significant percentage of the daily payments on Ripple which seems to be spam, only showing the extent of low activity on the network. The lack of smart contracts that reduce Ripple’s transparency also prevents it from participating in the DeFi and stablecoin sector. As Ethereum attracts more users on the network, Ripple is trying to do something similar but the results are far from convincing.
Bitcoin has the biggest market cap and has a 60% dominance in the crypto market. it is also the most recognized brand in the crypto space as any project that is interoperable with Bitcoin has a strong chance of gaining the market’s attention. So far, Ethereum enjoyed the most. With apps such as Compound, Bitcoin holders can also enter into the decentralized finance or the Defi sector and earn passive income from their idle coins. This possibility boosted the traffic on the platform especially for wrapped bitcoin (WBTC).
WBTC is a pegged token which means every token is held by a custodian and there is one ERC-20 token minted on ETH. It seems that the XRP ledger is trying to do something similar. As per the latest Ripple hoax that we have in our ripple news, it seems that this blockchain cannot extend Bitcoin’s computational capabilities but it can increase Bitcoin’s speed and can also influence by lowering down transaction fees.
Unlike Ethereum, XRP’s ledger will not be able to ride the DeFi wave because it has a lot of limitations. Like WBTC, Ripple utilizes trusted token arrangements in order to mint tokens and these ones are called “gateways.” With the BTC capitalization dynamic, it’s clear that the ripple ones didn’t issue any major quantities of BTC lately but the BTC volumes remained dismal. Unlike WBTC, BitGo and Ripple can have an unlimited number of gateways. Any account can represent a gateway and issue non-XRP tokens such as BTC and ETH but it is up to the users to decide.
There’s also no limit on how many tokens one account can issue as the only limitation is the number of tokens that other users want to hold. An issuer can block issued tokens from getting transacted by the bigger Ripple community.
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