How to start trading or investing in Ripple (XRP)? A 3-step-guide
If you are reading this, you have probably heard of cryptocurrencies or more specific, one of the leading cryptocurrencies called Ripple (XRP). Most people know it as Ripple, but Ripple is, in fact, the name of the company that created XRP and uses it for international payments. Another concept that has probably led you to this article as well is trading, whether it is stocks, foreign currencies or cryptocurrencies. This article mainly focuses on trading cryptocurrencies, in this case XRP and how to get started.
This article covers the basics of XRP and will help you get familiar with an exchange called Binance. It also walks you through the steps on how to purchase XRP on this exchange.
Lastly, we will discuss some additional information we feel is advantageous to know when starting to trade or invest in XRP.
What is XRP?
XRP, a cryptocurrency created by a company called Ripple, is a coin created for everyday transactions which are widely used by individuals, institutions and banks.
The continuous and various developments on Ripple have made it a top choice for not only daily transactions but also an investment opportunity for the nearest future, some even prefer to trade it against other cryptocurrencies.
Whether you are just sending some XRP to someone on the other side of the world, trading it, or buying them to keep as investments, this article guides you on how to acquire XRP tokens in 3 simple steps by exchanging it with major cryptocurrencies on the Binance Exchange.
Before you get some XRP on Binance, you need to have the same worth of Bitcoin (BTC), Ethereum (ETH), or any other cryptocurrency to exchange for XRP. There are a couple of ways of buying Bitcoin and other alternative cryptocurrencies with fiat, but this is covered in our previous articles listed below.
How to buy XRP?
Here is a step-by-step guide for you to follow so that you can jump into the cryptocurrency markets and start buying XRP today:
1. Register on the Binance exchange
Selecting a cryptocurrency exchange in 2019 to purchase your first cryptocurrencies can be a daunting and overwhelming process. After all, there are over 200 cryptocurrency exchanges in today’s market, with 24-hour trade volume in the billions. So, how do you make your choice?
Here are a few attributes to look at while choosing your exchange of choice:
- Geographical location and their constraints;
- Transaction fees;
- Security, anonymity, and customer support;
- Ease of use and User Interface;
- Volume and liquidity of the exchange.
Note that the above list does not cover all needed attributes to consider while choosing an exchange but are a good solid basis to start off with. An expanded version of these steps can be found in one of our previous articles listed below.
A few exchanges to choose from are:
For the purpose of this article, we will work on the Binance Exchange.
Here is a quick summary of what has been discussed in the previous article regarding registration on Binance.
- Register on the Binance exchange – Firstly, you need to create an account on the Binance exchange platform. To do this, head over to the Binance Exchange official site and click on the register link on the top right of the screen and fill in the following fields. Follow the prompts until your account is registered.
- Verify your account – Fill the Registration form and verify your account.
2. Choose an XRP wallet
After choosing your exchange, in our case Binance, you would need to create a crypto wallet to store and control your funds on. Due to this article focusing on XRP we need to obtain an XRP wallet. Firstly, a cryptocurrency wallet is a place where you store encrypted passwords that represent your coins, it is the equivalent to storing money in a bank account. Below is listed different types of crypto wallets for you to choose from.
There are several types of cryptocurrency wallets that provide different ways to store and access your digital currencies. Wallets can be broken down into three categories namely: (a) software wallets, (b) hardware wallets, and (c) paper wallets.
Again, more information on cryptocurrency wallets, see the link provided below to read our previous articles.
For the purpose of this article, we will use an online software wallet to store our XRP.
You will find that Binance has its own cryptocurrency wallets provided for you as a user on the exchange, but it is advised that after your trading is done to move your funds from the exchange to a separate wallet and never leave it on an exchange.
3. Purchasing XRP
From this point on we will dive into what you came here to learn. We will guide you through buying the cryptocurrency XRP on the Binance exchange.
You may or may not have some experience in trading the stock market or Forex (FX) market, but the Crypto market is a whole different ‘game’. It is advised to study the cryptocurrency charts first before starting to trade or invest in them. It is advised not to assume that your skills attained by trading other markets will be sufficient and that your trading plans will work the same in the crypto market.
It is important to find a strategy for each trade you will make and apply these strategies in the Cryptocurrency market.
- Firstly, log onto the Binance exchange, it is assumed that you already have an account registered and that your account is funded as explained previously and in previous articles. For this article, we assume you have read the previous article and are familiar with the terms. We will work with the XRP/BTC trading pair which assumes that your account is funded with Bitcoin in this case. After login click on the “Exchange” button represented in the top left corner:
- After clicking on “Exchange”, select advanced and you will find the following page:
- Head over to the top Right-hand side to choose your trading pair and search for XRP in the search bar as shown below:
This will lead you to the chart representing XRP’s price against Bitcoin’s price. This is where we are going to trade our XRP tokens against Bitcoins. The page should look similar to the following:
- To start trading or holding XRP, we need to buy some first. To buy your first XRP go to the bottom right-hand side of the page where you will find a section stating” Buy XRP”. The section will look similar to the following:
- Make sure the ‘Limit’ tab is active as seen above highlighted in Orange. A ‘Market’ tag would buy Ripple for you at the first selling price of an XRP seller, this price is usually a higher price than if you set it yourself. If you’re a completely new trader, you can use the Market tab to eliminate the possibility of error.
Note that the above picture shows a balance of 0 BTC and 0 XRP due to it being used for this demo. In your case, after depositing BTC, your available BTC balance will be presented in the buy column.
- Determining how much XRP you would like to buy – The first box “Buy XRP” has a subsection called “Price”. This box represents how much 1 XRP costs in terms of Bitcoin. The second sub box “Amount”, you are expected to input the number of XRP you would like to purchase. Use the options below it to select what percentage of your funded coins to use, 25%, 50%, or all your funds 100% and the amount of XRP you can purchase will automatically show up in the “Amount” box. Lastly the “Total” sub box will show you how much your purchase will cost. In this case in terms of BTC.
- Purchasing XRP – To finalize your purchase, click the “Buy XRP” button.
Your XRP order will now be listed onto the exchange and executed once ‘somebody’ sells their XRP to you at that price. If you have selected the Market Price, your order will go through immediately. Your XRP will now be sent through to your Binance XRP wallet, and it is advised if all trading or investing is finished to deposit it into your external XRP wallet.
A magnitude of global payment transfer companies is adopting the XRP ledger in their payment flows. Additionally, Ripple has announced partnerships with major companies and institutions such as Santander, SBI Holdings, and the China-based payment system, LianLian. The financial industry outlook for Ripple looks very positive with over 100 financial players including banks and payment providers benefitting from Ripple’s blockchain-based solutions.
It is said that XRP can replace the traditional SWIFT payment system and become the preferred payment processor for banks.
XRP Transaction Speed
XRP is designed to handle 1500 transactions per second. XRP has a significant speed advantage over its nearest cryptocurrency competitors such as TRON which currently handles 1000 transactions per second and Bitcoin Cash with 60 transactions per second. Ripple also competes with traditional payment procedures trailing behind VISA (at 25000 transactions per second). Thus, XRP is able to handle bank transfers and financial transactions at very high speeds.
While trading or investing in XRP or any other cryptocurrency, it is advised to always stay calm and not attach emotions to it, have a strategy and follow it. It is advised to research XRP, its advantages and disadvantages in more detail before investing in it, this goes for ANY cryptocurrency or any other investment decision in fact.
You have successfully attained XRP now and thus setting you ahead of the rest of the world. Good luck and safe trading or investing.