XRP Ledger Explained: How the Network Behind XRP Works

The XRP Ledger is the blockchain that the cryptocurrency XRP runs on. It is a public network without mining: instead of pitting computing power against each other, servers vote by fixed rules on which transactions are valid. A payment is final after three to five seconds, and it costs a fraction of a cent.

Search the web for the XRP Ledger and you usually end up with a report on a protocol update or a price page. This article does something else. It explains how the ledger works technically, which of its quirks affect you as a holder in practice, and what applies when you buy, when you self-custody and when you file your taxes in Germany. You will not find a price forecast here, and there is a reason for that further down.

Are XRP and the XRP Ledger the same thing? Network, cryptocurrency and Ripple kept apart

Three terms are almost always mixed up, although they denote three different things.

The XRP Ledger (XRPL for short) is the blockchain itself, meaning the jointly maintained database together with the software that keeps writing it forward. XRP is the native cryptocurrency of that network: the only unit that fees are paid in and that exists on the ledger without any third party. Ripple, in turn, is a private company based in the United States that builds payment software and holds a large stock of XRP.