What is xrp? XRP is a cryptocurrency designed for fast, low-cost international payments. While Bitcoin set out to be digital money and Ethereum aimed to be a programmable platform, XRP was built with a specific mission: making cross-border payments faster and cheaper than the traditional banking system.
XRP runs on the XRP Ledger (XRPL), a decentralised blockchain that has been operating since 2012. The company most closely associated with XRP is Ripple Labs, which uses the XRP Ledger as part of its payments technology. However, the XRP Ledger itself is open-source and operates independently of Ripple.
One of XRP’s most distinctive features is that all 100 billion XRP tokens were created at launch. There is no mining and no new XRP will ever be created. This makes it fundamentally different from Bitcoin (which is gradually mined over time) and Ethereum (which issues new tokens as staking rewards).
XRP at a glance (last updated May 2026)
Price: ~$1.96 AUD | Market cap: ~$120 billion AUD | Circulating supply: ~61 billion of 100 billion total
How Does XRP Work?
XRP takes a very different approach to most cryptocurrencies. Understanding these differences helps explain why it’s found a niche in cross-border payments.
The XRP Ledger. The XRPL is an open-source, decentralised blockchain that processes transactions in 3-5 seconds. That’s dramatically faster than Bitcoin (which takes around 10 minutes) and comparable to or faster than most modern blockchains. Transaction fees on the XRPL are fractions of a cent.
Consensus, not mining. Unlike Bitcoin’s Proof of Work or Ethereum’s Proof of Stake, the XRP Ledger uses a unique consensus protocol called the Federated Consensus mechanism. A network of trusted validators agree on the order and validity of transactions. This doesn’t require mining or staking, which is why XRP has minimal energy consumption.
Pre-mined supply. All 100 billion XRP were created when the ledger launched. There are no mining rewards and no new tokens to be created. Ripple Labs holds a significant portion of the total supply in escrow, releasing a set amount each month. This predictable release schedule is designed to prevent sudden supply shocks.
Bridge currency for payments. XRP’s primary designed use case is as a bridge currency for international payments. Instead of banks holding pre-funded accounts in foreign currencies around the world (which ties up capital), they can use XRP to transfer value between currencies in seconds. For example, to send money from Australia to Japan, AUD could be converted to XRP, transferred almost instantly, and then converted to JPY on the other end.
Built-in exchange. The XRP Ledger has a built-in decentralised exchange that allows users to trade any asset issued on the ledger. This means the XRPL can handle not just XRP transfers but also tokenised assets, stablecoins, and other digital currencies.
A Brief History of XRP
XRP has had one of the most dramatic journeys in crypto, including a high-profile legal battle that defined much of its recent history.
2012: The XRP Ledger launches. The XRPL went live in June 2012, created by developers David Schwartz, Jed McCaleb, and Arthur Britto. The project predates Ethereum by several years. Ripple Labs (originally called OpenCoin) was founded to commercialise the technology for cross-border payments.
2013-2017: Building the payments network. Ripple focused on building partnerships with banks and financial institutions around the world. The company developed products like RippleNet (a payments network) and On-Demand Liquidity (ODL), which uses XRP as a bridge currency. By 2017, XRP had become one of the top three cryptocurrencies by market cap.
2018: The all-time high. XRP reached an all-time high of approximately $3.40 in January 2018 during the broader crypto bull market. The token briefly held the #2 position by market cap, ahead of Ethereum. The subsequent bear market saw a sharp correction, but XRP maintained a loyal community and continued development.
2020: The SEC lawsuit. In December 2020, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Ripple Labs, alleging that XRP was an unregistered security. This sent XRP’s price tumbling and led several major exchanges to delist or suspend XRP trading. It was a pivotal moment for the entire crypto industry.
2023: A landmark ruling. In July 2023, Judge Analisa Torres ruled that XRP is not a security when sold on public exchanges to retail investors. This was a landmark decision that provided clarity not just for XRP but for the broader crypto market. Institutional sales were treated differently, and Ripple was later ordered to pay a $125 million penalty, down from the SEC’s $2 billion demand.
2025: Case closed, ETFs approved. In early 2025, the Ripple vs SEC lawsuit was formally settled. Both parties withdrew their appeals and the case was closed after nearly five years. Ripple paid $50 million in a final settlement, and the injunction was dissolved. In July 2025, the SEC approved the first XRP ETF (a leveraged futures product), and spot XRP ETFs from multiple issuers followed in September, attracting nearly $1 billion in net inflows. XRP reached a new all-time high above $3.40 in July 2025, surpassing its 2018 peak for the first time in seven years.
Where things stand today. With the legal cloud lifted and ETFs providing institutional access, XRP has entered a new chapter. Ripple continues to expand its payments network globally, and the XRP Ledger’s ecosystem of DeFi, NFTs, and tokenised assets continues to grow.
Why Do People Buy XRP?
Cross-border payments use case. XRP was purpose-built for real-world utility in international payments. Ripple’s partnerships with financial institutions around the world give XRP a practical use case that many other cryptocurrencies lack. If the global payments industry increasingly adopts blockchain technology, XRP is positioned to play a central role.
Speed and cost. XRP transactions settle in 3-5 seconds and cost fractions of a cent. For people who value the ability to send value quickly and cheaply, whether for personal transfers or remittances, XRP delivers.
Regulatory clarity. The conclusion of the SEC lawsuit and the subsequent approval of XRP ETFs have provided a level of regulatory clarity that few other altcoins enjoy. For investors who are cautious about regulatory risk, XRP’s legal status in the US is now better defined than most of its competitors.
Institutional access via ETFs. The launch of spot XRP ETFs means traditional investors, including superannuation funds and asset managers, can now gain exposure to XRP through regulated financial products. This institutional on-ramp increases demand and legitimacy.
Fixed supply. All 100 billion XRP were created at launch and no more will ever be made. Small amounts of XRP are also destroyed with each transaction (as fees are burned rather than paid to validators), making the supply very gradually deflationary over time.
Accessibility. You don’t need to buy thousands of XRP. You can purchase a fraction, even just $10 worth, through an Australian exchange like Digital Surge.
Is XRP Safe?
The XRP Ledger is proven technology. It has been running continuously since 2012 without a major security breach. The consensus mechanism is energy-efficient and well-tested over more than a decade of operation.
The legal picture is clearer. The resolution of the SEC lawsuit removed a significant source of uncertainty for XRP. With ETFs now trading and clear regulatory precedent, the legal risk that once hung over XRP has substantially diminished.
Centralisation concerns. Critics have pointed out that Ripple Labs holds a large portion of the total XRP supply (held in escrow with monthly releases) and has significant influence over the ecosystem. This is worth understanding as an investor, though the XRP Ledger itself operates independently of Ripple.
Use a reputable exchange. Buying and holding XRP on a trusted Australian exchange like Digital Surge, which is registered with AUSTRAC and offers two-factor authentication (2FA) and cold storage, is the safest approach for beginners.
Volatility applies. Like all cryptocurrencies, XRP’s price can be volatile. Consider a long-term perspective and only invest what you’re comfortable holding through market cycles.
XRP and Tax in Australia
In Australia, the ATO treats XRP and other cryptocurrencies as property for tax purposes, not currency. This means:
Capital gains tax (CGT) applies when you sell, trade, or exchange XRP. If you hold for more than 12 months, you may be eligible for a 50% CGT discount.
Buying and holding is not a taxable event. You only trigger a tax obligation when you dispose of your XRP.
Keep records. Track your purchase price, date, sale price, and any fees. Digital Surge provides transaction history that makes this easier, and you can connect your account to crypto tax tools like CoinTrack to automate the process.
This is general information only, not financial or tax advice. Consult a qualified tax professional for advice specific to your situation.
How to Buy XRP in Australia
Buying XRP in Australia is straightforward with the right platform. Here’s how it works on Digital Surge:
1. Sign up. Create your free account in minutes. You’ll need to verify your identity (a standard KYC requirement under Australian law). It’s quick and secure.
2. Deposit AUD. Transfer Australian dollars to your account via bank transfer, PayID, or other supported payment methods. There are no deposit fees on Digital Surge.
3. Buy XRP. Search for XRP, enter the amount you’d like to buy and confirm your purchase. You can buy as little as $10 worth.
4. Hold or transfer. Your XRP is safely stored in your Digital Surge account, or you can transfer it to your own personal wallet if you prefer to self-custody.
Frequently Asked Questions
Is XRP the same as Ripple?
No. Ripple is a private company (Ripple Labs) that develops payments technology. XRP is the cryptocurrency that runs on the XRP Ledger. Ripple uses XRP as part of its products, but the XRP Ledger is open-source and operates independently. In everyday conversation, people sometimes use “Ripple” and “XRP” interchangeably, but they are different things.
Is XRP legal in Australia?
Yes. XRP is legal to buy, sell, and hold in Australia. Cryptocurrency exchanges operating in Australia must be registered with AUSTRAC and comply with Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regulations. Digital Surge is fully registered and compliant.
What happened with the SEC lawsuit?
The SEC sued Ripple Labs in December 2020, alleging XRP was an unregistered security. In 2023, a judge ruled that XRP sold on public exchanges to retail investors is not a security. The case was formally settled and closed in 2025, providing regulatory clarity. XRP ETFs were subsequently approved, further legitimising the asset.
How is XRP different from Bitcoin?
Bitcoin is primarily a store of value with a fixed supply of 21 million coins that are gradually mined. XRP was designed for fast, cheap payments with all 100 billion tokens created at launch. Bitcoin transactions take around 10 minutes, while XRP transactions settle in 3-5 seconds. They serve fundamentally different purposes.
Can I lose money with XRP?
Yes. XRP’s price is volatile and can go down as well as up. While the resolution of the SEC lawsuit reduced one source of risk, market and price volatility remain. Only invest what you’re comfortable potentially losing and consider a long-term investment horizon.
What is the XRP escrow?
Ripple Labs holds a large portion of the total XRP supply in cryptographic escrow on the XRP Ledger. Each month, a set amount of XRP is released from escrow. Any unused portion is returned to escrow for future release. This mechanism was designed to provide transparency and predictability about the supply entering the market.
DISCLAIMER: The information in this blog is for general information purposes only. It is not intended as legal, financial or investment advice and should not be construed or relied on as such. Before making any commitment of a legal or financial nature you should seek advice from a qualified and registered legal practitioner or financial or investment adviser. No material contained within this website should be construed or relied upon as providing recommendations in relation to any legal or financial product.
