Ripple Transaction Protocol (RTXP
) is an Open Source Distributed Ledger Technology
By The Ripple Company
to support the Cryptocurrency XRP
Ripple Transaction Protocol uses a Consent Mechanism that allows for payments, exchanges and remittance in a distributed process.
Ripple Transaction Protocol website describes the Open Source protocol as "basic infrastructure technology for interbank transactions – a neutral utility for financial institutions and systems".
Ripple Transaction Protocol requires two parties for a transaction to occur:
- a regulated financial institution "holds funds and issues balances on behalf of customers."
- "market makers" such as hedge funds or currency trading desks provide liquidity in the currency they want to trade in.
The Consent Mechanism allows for payments, exchanges and remittance in a distributed process.
According to the CGAP in 2015, "Ripple does for payments what SMTP did for email, which is enable the systems of different financial institutions to communicate directly."
Ripple Transaction Protocol uses the Ripple Consensus Protocol Algorithm
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