This story appears in the October 2014 issue of Entrepreneur.Subscribe » Like Bitcoin, Ripple makes money easier to move around the world.But while Bitcoin is a currency, Ripple is an internet protocol that allows for financial transactions in any currency. and recently launched CrossCoin Ventures, an accelerator that mentors Ripple-based startups and helps them tackle finance-specific challenges such as compliance and customer-service requirements.Like Bitcoin, Ripple is a shared public database and global ledger.A process called consensus allows computers on the Ripple network to automatically agree on changes to the ledger within seconds, without needing to go through a central clearinghouse.This settlement speed was its major engineering breakthrough.That means Ripple transactions typically settle in three to five seconds, unlike Bitcoin transfers that can take up to 40 minutes to process.It will let small businesses receive money from customers from anywhere in a matter of seconds.

Today, it takes up to three days for credit card purchases to hit a small business's bank account.Getting that money more quickly is a big help in managing a company's daily cash flow.Since Ripple makes transferring money nearly free, credit card companies will likely lower their transaction fees in order to compete, thereby reducing small businesses' costs.Credit card fees disproportionately affect today's small businesses.Large businesses can negotiate better deals, but small ones can't.If you're a small firm that does a lot of business overseas, the benefits of Ripple are huge.It can take up to five days to transfer money overseas, and the average transfer fee is 7 percent.Ripple gets the money there in three to five seconds and lets you transfer money for little to no fee.Crypto-currencies take time; they're rewriting the plumbing of financial services.But yes, I think the chances are good.Ripple Labs' focus is on compliance and getting regulators and banks to buy in.I wouldn't be surprised to see Ripple powering everyday purchases in the next 24 months.Ripple is open-source and is more intended as a public good; Ripple Labs doesn't own or control the protocol.

However, it did create its own crypto-currency to facilitate transactions, called XRP.Wall Street can trade XRP with other currencies and provide liquidity across currencies.This helps the market determine the exchange rates for Ripple transactions.One hundred billion XRPs were created at Ripple's inception, and no more can ever be created, which is similar to how Bitcoin was created.But there's a radical difference: Ripple's XRP can't be mined like Bitcoin.One of Ripple's founders came from the Bitcoin community and took issue with the energy-intensive [computer] mining process necessary to create each Bitcoin, so he designed Ripple without it.The currency is just there, and to finally answer your question, Ripple Labs holds about 25 percent of it, and they use that to fund their operations.The U.S.ranks 30th among countries with the fastest average internet speed, according to the Internet Society's "Global Internet Report 2014."Downloadsin the U.S.--the fastest country in the Western Hemisphere--are 67 percent slower than in No.

ranks 10th in the world in terms of mobile broadband access.Earlier this year, Kraken in partnership with The Economist, launched a contest that posed an important question to MBA programs across the country.UPDATE: Winners of the Kraken contest have been announced: You have $1M to invest across bitcoin and ether.You cannot touch your investment for the next 5 years.bitcoin converter widgetHow much of that $1M do you invest in each?fastest bitcoin miningKraken’s essential question is, “which is the digital asset of the future?” In response, 13 teams have participated by providing a detailed paper and a short video to express their findings.iowa state bitcoinThrough in depth research, detailed analysis, and educated speculation, each team has presented their case for Kraken and the crypto community to assess and vote on.ethereal knives block

Submissions will be judged on the following main points: Kraken has incentivized the contest with cash prizes valued at $21,000 (USD).The 1st place winner will receive $10,000, 2nd place will be awarded $5,000, 3rd place will retain $3,000, and the People’s Choice to receive $3,000 as well.Each team was asked to quantify their results as a percentage, granting them free range in how much or how little they would potentially invest the one million into each currency.bitcoin wallet nzBelow is a chart of the initial results of each participant.bitcoin benefit or curseDetermining the findings took shape as grading systems to which the results were scaled, tallied, and quantified.deposit bitcoin smsThe teams also employed financial tools such as Monte Carlo simulations, to make accurate projections of growth for both currencies over the next five years.bitcoin dark chart

No one team held bias over their decision making but rather employed mathematical strategies that broke down fundamental attributes such as Upon reviewing the submissions, some distinct patterns began to emerge.All teams, with the exception of Ivey Business School at Western University, (no investment recommendation) invested some value into Ether.With a low of nine percent investment from Tuck School of Business at Dartmouth, to a high 100 percent investment from Worcester Polytechnic Institute, all expressed some if not significant investment value in ETH.bitcoin dollar rate graphBy scoring BTC and ETH through these attributes, teams were able to objectively manage data into their case studies, along with other real world factors such as commercial application, and projected growth affected by various trends in the crypto world.Although Bitcoin is currently the number one cryptocurrency today, most teams expressed Ether’s potential to replace bitcoin as the network grows.

With bitcoin having certain non-tech advantages over ETH, mainly it’s time on the market and the public’s familiarity, teams adamantly expressed their belief to place some, if not most of the speculative one million dollars into BTC, over the next five years.The reasoning behinds this stands that BTC currently has a higher monetary value over ETH and is expected to increase as much as 600 percent by 2020.The decentralization of bitcoin also played a factor in determining the growth of the currency, making it a safer bet to invest in, according to certain teams.Ether did reign champion at Worcester Polytechnic Institute with 100 percent investment, with both Porto and Rutgers Business Schools tying in 2nd place with an 80 percent investment.Teams that assigned 50 percent or more of the one million into ETH, expressed Ethereum’s value as a whole rather than as mere currency.The consensus dictates that smart contracts and commercial monetization of the EVM (Ethereum Virtual Machine) make it a valuable commodity to invest in, an advantage over bitcoin.

BTC was viewed as the more profitable currency, however it’s limitations beyond that was shared by many of the schools.“Ethereum’s nature makes it difficult for adaptors to understand the technology and for regulators to pass [legislation]”, according to BYU Marriot School of Management.This sentiment was echoed in other papers and played a significant role in the investment strategy.For some teams, ETH’s short time in existence played a bigger role than others, while some saw the potential for Ethereum to become a major player not only as a currency, but also in part because of its unique ecosystem.Charts and diagrams broke down costs and trading trends over several years displaying exponential growth of ETH as much as 550 percent by 2020.Regardless of the final results of each team, the potential of ETH to become profitable was shared by most.We see this sentiment echoed in the paper from Worcester Polytechnic Institute: Nathaniel Popper and many others have referred to Bitcoin as the new, “Digital gold.” Ethereum on the other hand primarily seeks to provide a way to record and store transactions, and this difference is the primary reason why we believe Ethereum is the better investment over the next five years.