# Blockchains and ledgers

Executive summary
**Blockchains are distributed ledgers that record transactions in a secure, transparent, and immutable way. Ripple Custody represents supported networks as ledgers that accounts, tokens, indexers, and transactions can use.**

- Blockchains use cryptography to secure transactions and control asset creation.
- Ledgers are the configured blockchain networks available in your Ripple Custody deployment.
- Different blockchains have different architectures, consensus mechanisms, and capabilities.
- Ripple Custody abstracts blockchain complexity while preserving security guarantees.


Why this matters
Understanding blockchain fundamentals helps you make informed decisions about account structures, transaction strategies, and operational procedures. Each blockchain has unique characteristics that affect fees, confirmation times, and supported operations.

**For architects and operators**: Different blockchains require different operational considerations. Bitcoin-type chains use UTXOs; EVM chains use nonces and gas fees. Some chains have fast finality; others require multiple confirmations. Plan your operations accordingly.

## What is a blockchain?

A *blockchain* is a distributed database that maintains a continuously growing list of records called *blocks*. Each block contains a cryptographic hash of the previous block, creating an immutable chain of transactions.


```mermaid
flowchart LR
    subgraph B1["Block 1"]
        H1["Hash: 0x7a3..."]
        T1["Transactions"]
        P1["Prev: 0x000..."]
    end
    subgraph B2["Block 2"]
        H2["Hash: 0x9f2..."]
        T2["Transactions"]
        P2["Prev: 0x7a3..."]
    end
    subgraph B3["Block 3"]
        H3["Hash: 0xb4c..."]
        T3["Transactions"]
        P3["Prev: 0x9f2..."]
    end
    B1 --> B2 --> B3
```

### Key characteristics

| Characteristic | Description |
|  --- | --- |
| **Decentralized** | No single entity controls the network. Multiple nodes maintain copies of the ledger. |
| **Immutable** | Once recorded, transactions cannot be altered or deleted. |
| **Transparent** | All transactions are publicly visible (though identities may be pseudonymous). |
| **Cryptographically secured** | Digital signatures prove ownership; hashing ensures data integrity. |


## Blockchain and ledger types supported by Ripple Custody

Ripple Custody supports multiple blockchain architectures. In the product, each supported network is represented as a ledger with its own identifier, native asset, and ledger-specific behavior.

### Bitcoin-type (UTXO-based)

Bitcoin and similar blockchains use the *Unspent Transaction Output (UTXO)* model. Think of UTXOs as individual coins: when you spend, you consume entire UTXOs and receive change back.

| Network | Native Asset | Key Features |
|  --- | --- | --- |
| Bitcoin | BTC | Original cryptocurrency, proof-of-work consensus |
| Bitcoin Cash | BCH | Larger block size, lower fees |
| Litecoin | LTC | Faster block times than Bitcoin |
| Dogecoin | DOGE | Inflationary supply, low fees |
| Dash | DASH | Optional privacy features, instant transactions |


**Operational considerations:**

- Transactions consume and create UTXOs.
- Fees are calculated per virtual byte (vByte).
- Change outputs are automatically created.


### EVM-compatible (Account-based)

*Ethereum Virtual Machine* (*EVM*) blockchains use an account-based model with *nonces* (transaction counters), and support smart contracts.

| Network | Native Asset | Key Features |
|  --- | --- | --- |
| Ethereum | ETH | Smart contracts, DeFi ecosystem, proof-of-stake |
| Polygon | MATIC | Layer-2 scaling, low fees |
| Binance Smart Chain | BNB | High throughput, centralized validators |
| Avalanche C-Chain | AVAX | Sub-second finality, EVM compatible |


**Operational considerations:**

- Transactions use nonces for ordering
- Fees are calculated as gas × gas price
- EIP-1559 introduced base fee + priority fee model
- Smart contract interactions require gas estimation


### Other architectures

| Network | Native Asset | Architecture | Key Features |
|  --- | --- | --- | --- |
| XRP Ledger | XRP | Account-based | Fast settlement (3-5 seconds), low fees, built-in DEX |
| Stellar | XLM | Account-based | Fast, low-cost payments, asset issuance |
| Solana | SOL | Account-based | High throughput (65,000 TPS), low fees |
| Cardano | ADA | Extended UTXO | Academic research-driven, proof-of-stake |
| Polkadot | DOT | Relay chain | Interoperability, parachains |
| Tezos | XTZ | Account-based | On-chain governance, self-amending |
| Algorand | ALGO | Account-based | Pure proof-of-stake, instant finality |
| Hedera | HBAR | Hashgraph | Enterprise-grade, predictable fees |


For a complete list of supported ledger networks, see [Supported ledgers](/products/custody/v1.36/reference/supported-ledgers).

## How Ripple Custody interacts with blockchains and ledgers

Ripple Custody provides a unified interface for interacting with multiple blockchain ledgers:


```mermaid
flowchart TB
    subgraph Custody["Ripple Custody"]
        API[API Gateway]
        LA[Ledger Accounting]
        IDX[Indexers]
    end

    subgraph Nodes["Blockchain Nodes"]
        BTC[Bitcoin Node]
        ETH[Ethereum Node]
        XRP[XRPL Node]
        OTHER[Other Nodes...]
    end

    API --> LA
    LA --> IDX
    IDX --> BTC
    IDX --> ETH
    IDX --> XRP
    IDX --> OTHER
```

| Component | Function |
|  --- | --- |
| **API Gateway** | Receives transaction requests from users and applications |
| **Ledger Accounting** | Tracks balances, manages transaction lifecycle |
| **Indexers** | Monitor blockchain networks, detect incoming transactions, broadcast outgoing transactions |
| **Blockchain Nodes** | Customer-managed or third-party nodes that connect to blockchain networks |


For more on indexers, see [Unified Indexer Service](/products/custody/v1.36/overview/architecture/unified-indexer-service).

## Accounts and transactions

Ripple Custody uses two core concepts for blockchain interaction:

| Concept | Description | Learn More |
|  --- | --- | --- |
| **Accounts** | Logical entities that hold assets and derive blockchain addresses from a vault's master seed | [Accounts](/products/custody/v1.36/accounts-and-assets/accounts/overview) |
| **Transactions** | Operations that transfer assets or interact with smart contracts | [Transactions](/products/custody/v1.36/transactions/overview) |


### Account-to-address relationship

A single Ripple Custody account can have addresses on multiple blockchains:


```mermaid
flowchart LR
    subgraph Account["Account: Treasury"]
        ID["Account ID: acc_123"]
    end

    subgraph Addresses["Blockchain Addresses"]
        BTC["Bitcoin: bc1q..."]
        ETH["Ethereum: 0x7a3..."]
        XRP["XRPL: rN7n..."]
    end

    Account --> BTC
    Account --> ETH
    Account --> XRP
```

The addresses are derived from the same master seed using blockchain-specific derivation paths. For details, see [Key derivation](/products/custody/v1.36/accounts-and-assets/accounts/account-key-derivation-and-ledger-compatibility).

## Next steps

| Topic | Description |
|  --- | --- |
| [Accounts](/products/custody/v1.36/accounts-and-assets/accounts/overview) | Learn how accounts work in Ripple Custody |
| [Transactions](/products/custody/v1.36/transactions/overview) | Understand the transaction lifecycle |
| [Key derivation](/products/custody/v1.36/accounts-and-assets/accounts/account-key-derivation-and-ledger-compatibility) | How blockchain addresses are derived |
| [Supported ledgers](/products/custody/v1.36/reference/supported-ledgers) | Complete list of supported ledger networks |
| [Dynamic ledgers payloads](/products/custody/v1.36/accounts-and-assets/blockchains/dynamic-ledgers-payloads) | Payload examples for adding supported ledger records |
| [Dynamic ledger payload reference](/products/custody/v1.36/accounts-and-assets/blockchains/dynamic-ledgers-update-payloads) | Payload examples for updating supported ledger records |