Ripple is a payment system, currency exchange and remittance network developed by Ripple Labs, a firm in California, previously known as Open Coin. The open source internet protocol and consensus ledger uses native currency called ripples (XRP). The Ripple network enables secure, instant and nearly free global financial transactions of any size with no chargebacks. It supports any currency (dollars, yen, etc.), cryptocurrency (bitcoin, litecoin, etc.), commodity or other unit of value (frequent flier miles, mobile minutes, etc.).
The Ripple protocol runs on a network of computer servers around the world. The Ripple network uses Ripple’s mathematical algorithm to verify the accuracy of financial transactions. The Ledger is a shared, constantly updated database of Ripple accounts and transactions. At any time, anyone can view the Ledger and see a perfect record of all activity on the Ripple network.
Ripple has three primary parts: A Payment Network – a network of financial accounts that makes transactions easy for users or businesses; A Distributed Exchange – an automated system for currency trades, that makes cross-currency payments possible and a Currency (XRP) built into Ripple, that holds value and also plays an important role in the security of the network.