$XRP
How Does the XRP Ledger Work?
In the previous episode, we explored what XRP is and why it was designed for global payments. In this episode, the key question is: how does the XRP Ledger actually work, and why is it different from other blockchain systems?
The XRP Ledger does not rely on mining or a proof-of-work mechanism. There are no mined blocks and no energy-intensive machines running in the background. Instead, it uses a unique method known as a consensus protocol. This means that selected validators within the network collectively agree on which transactions are valid and which are not.
The XRP Ledger is supported by dozens of independent validators distributed across the globe. Every few seconds, these validators gather incoming transactions and consult with one another to decide which transactions will be included in the next version of the ledger. If at least 80% of the validators agree on a transaction, it is permanently recorded.
This entire process is completed within three to five seconds, and once the ledger is updated, it cannot be altered. This is why settlement on the XRP Ledger is considered final—there are no reversals and no uncertainty after confirmation.
Another important distinction is that the XRP Ledger does not offer block rewards like Bitcoin. Validators do not receive newly created coins for validating transactions. The benefit of this design is that power does not gradually concentrate in the hands of a few large players, as happens in many other networks. The sole objective here is to maintain network accuracy and stability, not to maximize token rewards.
The XRP Ledger also gives users the freedom to choose which validators they trust. Each user can create their own Unique Node List (UNL), meaning they can personally decide which validators’ opinions to accept. If any organization or group attempts to misuse influence, users can easily exclude them.
Because of this architecture, the XRP Ledger is considered fast, secure, and relatively decentralized. The network has been running continuously for years, with millions of ledgers successfully closed without any major failures.
In summary, the XRP Ledger’s consensus system sets it apart from other blockchains. No mining, no excessive energy consumption, and no transaction delays. These characteristics make it a strong candidate for international and cross-border payments.
In the next episode, we will explore where and how XRP is being used in practice, and the role Ripple plays within this ecosystem.
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