FM Wealth Management News Letter
We cannot see how Ripple is going to get around this due to the fact
that there is no official documentation.
An option would be if Ripple themselves provided XRP liquidity at a set price away from the exchanges.
We have also read discussions proposing the use of market makers to provide liquidity. This option raises questions in itself. There would need to be a global network of liquidity providers, which currently does not exist, who hold large amounts of XRP and would accept large amounts of XRP at a seconds notice.
These market makers would find it very hard to keep hedge the risk or a flat book and XRP volatility could cripple them in minutes. Consider, as we write, XRP is down 27% today.
Another problem is the lack of xRapid users. As of January 11, 2018 there was only one partnership, with a Mexican company, Cualixx. On January 11th Ripple announced MoneyGram as a partner.
While encouraging news, this is more of a test than a sign of mass adoption:
MoneyGram will pilot the use of XRP; the native digital asset of the XRP Ledger, in payment flows through XRapid…
MoneyGram is the second largest money transfer company in the world, this strategic partnership will allow them to understand how Block-Chain technology and XRP can improve consumer experience and the efficiency of their global treasury operations.
The details of the deal are sketchy at best and we wouldwould love to know more. It is clear that Moneygram sees potential in xRapid.
If they see the potential so clearly then why commit to only a pilot project and why are so few companies using it? And most importantly, why have the hundred or so companies and major banks decided to stick with XCurrent’s the higher fees when they could adopt the XRP Token?
To us there seems to be more questions than answers. But there is one fact we are left with XRP’s use in global money transfers, right now is tiny.
Your Take Away
There are 100 billion XRP tokens in circulation. Making them worth about US$104 billion, which really meaningless if you consider that their value is based on what people are prepared to buy and sell at.
Ripple is transforming the way money is transferred and the price of XRP has rallied as the Ripple story has progressed even though XRP and Ripple are not the same thing. Owning XRP is not an investment in Ripple.
It is a speculative bet on mass adoption of Ripple’s XRapid system. Right now there is still very little information on this system and a good chance that it could completely fail or be replaced by an alternate crypto-currency. If this were to happen, Ripple the company would continue to thrive and likely go from strength to strength, but XRP would be practically worthless.
An option would be if Ripple themselves provided XRP liquidity at a set price away from the exchanges.
We have also read discussions proposing the use of market makers to provide liquidity. This option raises questions in itself. There would need to be a global network of liquidity providers, which currently does not exist, who hold large amounts of XRP and would accept large amounts of XRP at a seconds notice.
These market makers would find it very hard to keep hedge the risk or a flat book and XRP volatility could cripple them in minutes. Consider, as we write, XRP is down 27% today.
Another problem is the lack of xRapid users. As of January 11, 2018 there was only one partnership, with a Mexican company, Cualixx. On January 11th Ripple announced MoneyGram as a partner.
While encouraging news, this is more of a test than a sign of mass adoption:
MoneyGram will pilot the use of XRP; the native digital asset of the XRP Ledger, in payment flows through XRapid…
MoneyGram is the second largest money transfer company in the world, this strategic partnership will allow them to understand how Block-Chain technology and XRP can improve consumer experience and the efficiency of their global treasury operations.
The details of the deal are sketchy at best and we wouldwould love to know more. It is clear that Moneygram sees potential in xRapid.
If they see the potential so clearly then why commit to only a pilot project and why are so few companies using it? And most importantly, why have the hundred or so companies and major banks decided to stick with XCurrent’s the higher fees when they could adopt the XRP Token?
To us there seems to be more questions than answers. But there is one fact we are left with XRP’s use in global money transfers, right now is tiny.
Your Take Away
There are 100 billion XRP tokens in circulation. Making them worth about US$104 billion, which really meaningless if you consider that their value is based on what people are prepared to buy and sell at.
Ripple is transforming the way money is transferred and the price of XRP has rallied as the Ripple story has progressed even though XRP and Ripple are not the same thing. Owning XRP is not an investment in Ripple.
It is a speculative bet on mass adoption of Ripple’s XRapid system. Right now there is still very little information on this system and a good chance that it could completely fail or be replaced by an alternate crypto-currency. If this were to happen, Ripple the company would continue to thrive and likely go from strength to strength, but XRP would be practically worthless.
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