XRP Ledger or XRPL Explained

XRP Ledger or XRPL Explained

5 Min.

The XRP Ledger (XRPL) is a Layer 1 blockchain that is public, decentralized, and open source, which is managed by a global developer community. It is dependable, fast, and energy-efficient. For over a decade, it has been the most fitting blockchain for the large-scale liquidity and settlement of tokenized assets. The XRPL is backed by a supportive community, is easy to develop, and comes with low transaction costs. Its lean feature set is not impacted even when executing the most demanding projects, providing developers with a robust open-source foundation. XRPL allows for various services and use cases, including decentralized finance, tokenization, and payments.


The XRPL has been developed by a group of three developers who aimed to create a blockchain that is faster and more energy-efficient. The XRPL is a public and decentralized blockchain that has been the best option for the settlement and liquidity of tokenized assets on a large scale for over a decade. The XRPL has been operational since 2012 and has enabled the development of several projects by the XRPL community. The XRPL is currently supporting a variety of applications ranging from micropayments to DeFi and tokenization.

How Does XRPL Work?

The XRPL uses a unique validation process called Federated Consensus, which sets it apart from Bitcoin and Ethereum. Validators, independent servers, confirm transactions by agreeing on the order and outcome of XRP transactions through a consensus protocol. All transactions on the XRPL follow the same protocol and are public and transparent. Anyone can operate a validator, and there are currently over 150 validators worldwide, run by universities, businesses, exchanges, and individuals. The XRPL has been operational since January 2013 and has processed billions of transactions.

Thanks to Federated Consensus, the XRPL can process over 1,500 transactions per second (TPS), with confirmation speeds of 3 to 5 seconds. Users benefit from low transaction fees, usually under one cent, and a fairness advantage, meaning no single participant decides which transactions take priority. All verified transactions can be processed without a single point of failure as no single participant makes a decision independently.

Use Cases of XRPL

The XRPL is a flexible blockchain that supports Python, Java, and JavaScript programming languages. With its powerful features, it caters to the needs of independent developers and businesses looking to build various use cases. Developers can utilize different tutorials available on the XRPL website to learn about various programming languages, app development, account management, and more.

The XRPL, in addition to its native currency, XRP, offers solutions to inefficiencies in remittance and asset tokenization. Currently, the XRPL has five primary applications, including payments, tokenization, DeFi, central bank digital currencies (CBDCs), and stablecoins.


One of the main use cases of the XRP Ledger is for payments, enabling instant transfers of assets across the world for remittances, treasury payments, and payrolls. RippleNet powers cross-border payments through a decentralized network of banks and payment providers that use the XRP Ledger. Additionally, users can utilize Xumm, an XRP wallet that facilitates low-fee, global payments with a neutral bridge asset optimized for cross-border transactions.


Another use case is tokenization, with any asset being tokenized on the XRP Ledger, including fungible tokens, stablecoins, NFTs, and CBDCs. More than 5,400 currencies have been issued and traded on the XRPL as of May 2022.


The XRP Ledger also supports DeFi, providing access to financial products and services through its decentralized exchange (DEX). Users can trade digital assets directly on the XRP Ledger via various order book interfaces like Sologenic, which utilizes a central limit order book model.

CBDCs and Stablecoins

The XRP Ledger enables the tokenization of CBDCs, which allows central banks to securely interoperate with other payment systems. Additionally, financial institutions can issue stablecoins on the XRP Ledger.

What Makes XRPL Unique?

Compared to other networks, the XRPL is known for its energy efficiency. Its native coin, XRP, consumes just 0.0079kWh per transaction, making it a cost-effective and sustainable option for users. In addition to being fast, reliable, and affordable, the XRPL's energy efficiency makes it an eco-friendly choice for those who prioritize sustainability.

What Is XRP?

XRP is a digital asset native to the XRP Ledger, and it enables users to send global payments, transact on the XRPL decentralized exchange (DEX), and purchase NFTs.


To begin transacting, any user can set up an XRP wallet from various wallet providers. XRP transactions are quick and inexpensive, taking only a few seconds to send and receive from anywhere in the world. Additionally, the transaction fee is nominal, making it an affordable solution for users.

DeFi Transactions

The XRPL has a native decentralized exchange (DEX) where users can engage in DeFi transactions. Trading is one of the most popular applications of the DEX, enabling anyone to exchange one digital asset for another. Developers have created order book interfaces, such as Sologenic and Gatehub, to connect users with their XRP wallets and begin trading. Users can also trade many XRPL-native assets and wrapped assets.


NFTs are the latest addition to the XRPL’s ecosystem following the implementation of the XLS-20 mainnet proposal. Users can now create, buy, sell, and trade NFTs on various marketplaces while enjoying the benefits of the XRPL blockchain. The proposal enables all essential NFT functionality, including minting, trading, and burning, as well as advanced features like automatic royalties for creators and co-ownership of assets.


The XRPL is an efficient and developer-friendly platform that promotes transactions and applications. It provides solutions for cross-border payment issues faced by financial institutions and enterprises. The XRPL's protocol is energy-efficient and offers a gateway to a variety of resources.

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