How to Buy XRP in Canada
A guide on how to buy XRP in Canada with Netcoins
“XRP helps the banking industry move money around the world quickly and easily.”
Often times people use the words Ripple and XRP interchangeably. However, Ripple is the company behind the cryptocurrency, XRP. The company wants to help banks (and other financial institutions) move money faster, easily, and with less fees instead of focusing on helping people buy goods and services with XRP. In other words, you can think of them as trying to bridge traditional banking with cryptocurrencies.
Unlike bitcoin, XRP are not mined. Instead they are held by Ripple. The company created 100 billion XRP at the beginning of its inception, eventually selling them every month to raise funds. The smallest unit of XRP is called a ‘drop’ with 1 XRP equalling 1 million drops.
If you are wondering how to buy XRP in Canada, Netcoins is a publicly-traded, fully regulated crypto trading platform based in Canada. With 0% funding fees, free cash withdrawals, and live customer support service seven days a week, we make it simple for Canadians to buy XRP and other cryptocurrencies.
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Buy and sell as little as $10, or up to $10 million with no slippage due to our deep liquidity.
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XRP vs Most Other Cryptocurrencies – The Fundamental Difference
Before we start, let’s distinguish between XRP and Ripple once again. Although they’re used interchangeably, they are not the same. To clarify, Ripple is the company that invented XRP in 2012, and XRP is the cryptocurrency.
XPR is unique from other major cryptocurrencies, like bitcoin or ethereum. Rather than being a decentralized cryptocurrency for the people (like bitcoin), XRP is a centralized cryptocurrency focused on helping banks and other financial institutions move money quickly around the world at a fraction of the cost. With that said, XRP isn’t trying to be a currency people can use to buy and sell goods as much as it’s a currency in service to banks.
Thanks to the technology invented by Ripple, the XRP blockchain can process around 1,500 transactions per second. In comparison, the Bitcoin blockchain can process only a handful of transactions per second. Plus, XRP transactions can be confirmed in three to five seconds, whereas Bitcoin transactions are confirmed in ten minutes. Faster processing times can help the currency scale faster and gain wider adoption.
Another way XRP is different from more mainstream cryptocurrencies is that it does not use extensive energy to produce new XRP coins (like Bitcoin does). Instead, Ripple created all 100 billion XRP upfront when they launched the currency. They gradually sell XRP every month for a couple of reasons: to raise money and to release XRP into the economy.
Related article: Six Things to Consider When Vetting a Crypto Investment.
In short, Ripple wants to help the banking industry move money as quickly and easily as sending messages. If they succeed at this, XRP may see massive success among banks worldwide, which would inevitably affect businesses too.
How Much XRP Can I Buy?
You don’t need to buy a lot of XRP to get started! You can buy fractions of an XRP. In fact, the smallest possible unit of XRP is called a drop and is equivalent to 0.000001 XRP (6 decimal places). Put another way, 1 XRP = 1 million drops. Many beginners start their XRP journey by accumulating small amounts of XRP. You can start as small as $10, or invest up to $10 million with Netcoins.
Why Buy XRP?
The team behind Ripple represent a for-profit venture. Ripple’s mandate is to make processing and transferring large volumes of money between central banks cheaper and faster in a way that traditional technology can’t.
The value of the XRP token goes up because central banks doing business together on the Ripple blockchain need to spend tokens in order to complete transfers. Those tokens are burned once they are used, so the supply of XRP tokens decreases over time and increases the value of the remaining XRP tokens.
In addition, here are four more reasons why people buy XRP:
XRP is centralized. The fact Ripple is a privately held company means it’s a for-profit business. They have a built-in incentive to make the value of the XRP token go up. This means that everybody wins.
XRP serves banks. Ripple facilitates large-volume transactions for central banks across the world. If the project succeeds in the long-term, token holders will also get a cut of that value.
High Liquidity. Ripple’s blockchain sees billions of dollars in volume trading hands each day. High volumes of liquidity makes it easier to enter and exit positions involving XRP tokens.
Cheaper price. Full XRP tokens can be had for mere pennies. This means investors can enjoy the feeling of owning an entire token (or many of them) rather than just a fraction of one.
Is XRP Safe?
XRP has seen great success since its inception in 2012. To date, it remains one of the top 10 most successful cryptocurrencies by market cap. Like bitcoin and other cryptocurrencies, XRP has created millionaires overnight but it has also made people lose their wealth.
With that said, buying XRP is still considered a risky investment given its volatility. But high volatility can work in both directions. It can work in your favour and yield great potential for return. And it can work against you by causing you to take on big losses. That is why it’s important to never invest more than you’re ready or willing to lose.
For many investors though, buying XRP is seen as a great opportunity to invest in the future of banking – an industry long-plagued by outdated technologies and ineffective processes.
However, keep in mind that XRP is a centralized cryptocurrency, meaning it puts all the power on a centralized entity like Ripple. At any moment, Ripple could change the rules of the game, the code that runs the XRP network, and ultimately the supply of XRP, violating the trust of the network.
So, it’s up to you to decide how much you wish to invest in XRP. The beauty of buying XRP is that anyone, anywhere around the world can buy fractions of an XRP. If you decide to buy XRP but are not sure how much to buy, you can start by practicing any one of these strategies:
- Investing a percentage of your wealth into XRP (like 1% or 10%)
- Dollar-cost-averaging (buying a set amount of XRP every day, week or month)
- Buying the dip (buying when XRP prices decrease)
- Starting as small as $10 to test it out yourself.
One of the best ways to keep your XRP safe is to remove them from a crypto trading platform and transfer them directly to a crypto wallet you own. By transferring your XRP into a hardware wallet you are protecting your asset against hacking, fraud and theft.
Finally, it can be wise to build an investment portfolio that has a mix of traditional assets (like real estate, gold, stocks) and non-traditional assets (like XRP) in order to protect your financial well-being in the future.
How Do I Store My XRP?
You can buy XRP from crypto trading platforms, like Netcoins, and leave your XRP inside the platform. However, there are much safer options to storing your XRP as leaving them in exchanges can expose them to certain risks like hacking and theft.
The safest option to keeping your XRP secure is to transfer them into a bitcoin wallet. An XRP wallet is a type of digital wallet that is used to send and receive XRP, similar to a Google wallet or a physical wallet.
There are four different types of crypto wallets: hardware wallets, desktop wallets, mobile wallets and web wallets.
Hardware wallets look like a USB device. They are considered to be offline wallets because they’re not connected to the internet. The fact they’re offline makes them more difficult to find and to hack. As such, they’re typically considered the safest option to store your XRP.
Desktop wallets on the other hand are programs that store your XRP on your computer’s hard drive. Mobile wallets perform the same function as a desktop wallet but on a mobile device instead.
Finally, a web wallet is an online service that sends and stores your XRP on your behalf anywhere, anytime. Similar to checking your email.
Desktop, mobile and web wallets are all connected to the internet (and referred to as “hot wallets”). Like mentioned earlier, they are more susceptible to potential risks. On the other hand, hardware wallets (or “cold wallets”) are considered safer options as they are not connected to the internet.
This is why it’s often advised that Canadians pull out their XRP from crypto trading platforms and send them directly to a hardware wallet like Ledger Nano X, Ledger Nano S, Trezor Model T. Only in this way, are they in full possession of their XRP and can keep them secure.
Is XRP a Good Investment in 2022 & Beyond?
It’s clear the banking industry needs a change. It should be easier to transfer money across borders at cheap prices than it is today. For this reason, XRP appeals to many investors. Despite what most people believe, it’s still early for XRP. We will see the banking and financial industry continue to be revolutionized in today’s digital era.
Demand for XRP may grow in 2022 as the real use case for XRP grows and as banks around the world continue to adopt it. This will inevitably affect the way businesses run their operations and manage their finances. So, it’s likely we’ll see XRP perform well over time.
Having said all that, investors should keep an eye out on the Securities Exchange Commission’s (SEC) lawsuit against Ripple before committing significant investments into the asset.
This post is for informational purposes only. For proper financial advice, we recommend you speak to a financial advisor.
Frequently Asked Questions
Why buy XRP?
XRP is a great way for investors to diversify their cryptocurrency portfolio by having a mix of centralized (XRP) and decentralized (bitcoin) assets.
People invest in XRP for three main reasons:
- Ripple is a for-profit business with an incentive to increase the value of XRP
- Gives exposure to blockchain technology while staying in the traditionally centralized world of finance
- Offers cheaper fees
Some investors view Ripple as a perfect happy medium between investing in riskier projects that don’t have a true leader and a project that at least in part functions like a proper company.
Are there any risks involved if i buy xrp?
All forms of investments carry with them an inherent level of risk so you should never invest more than you’re willing or ready to lose.
Cryptocurrencies like XRP are known to be volatile and the price fluctuates quite a bit on a day-to-day basis. What’s important to understand as well is to zoom out and look at the bigger picture.
If you do buy XRP, also remember to properly secure your account with Two Factor Authentication and follow security best practices!
How much xrp should i buy?
A common misconception is that you have to buy 1 entire XRP, but you can actually buy fractions of XRP. You can start off with as little as $10, or invest a certain % of your wealth.
When investing in cryptocurrencies, many beginners start off by dollar-cost averaging in, which is the practice of putting in a set amount of money towards XRP in regular intervals (for example $10 every month).
Why is KYC (Verification) required?
KYC is a process that allows us to verify the identity of our customers, as per Canadian regulations.
What do I need to provide for your verification process?
If you don’t pass the automated KYC process, you will have to go through an additional document verification stage. This is important and required as we are a regulated money service business in Canada.
How can I fund my account?
Once you have funds in your Netcoins account, you’ll find that it’s super easy to buy XRP in Canada.