JoelQuinn reacted to Julian_Williams in Kuwait Finance House started operating an instant cross-border remittance service using Ripple’s blockchain
This seems to be an update to a similar announcement back in August (but at that time many XRP chat members thought the announcement might be "fake news"):
JoelQuinn got a reaction from Gepster in Balance sheet operations of a cross-border settlement process with the use of XRP
Thanks @tarand @KarmaCoverage. I always appreciate your knowledge, questions and diligence.
JoelQuinn got a reaction from hallwaymonitor in Balance sheet operations of a cross-border settlement process with the use of XRP
Thanks @tarand @KarmaCoverage. I always appreciate your knowledge, questions and diligence.
JoelQuinn reacted to Montoya in The impossibility of liquidity in xrp
There is no reason why your suggestion would not work. In fact, with the advent of sovereign cryptos I find it increasingly likely. However, it is a separate issue from your main critique which is the suggested unworkability of a deflationary currency underpinning an inflationary international monetary system. You seem to take it for granted that all schools of economics are in agreement that deflation is necessarily a problem. This is not the case. I cannot fault you on your logic as it is most likely coherent within your school of economics. Other schools have begun to question this assumption, as the metric used to draw this conclusion is GDP, which is increasingly being recognized as not indicative at all of quality of life or actual economic growth. Access to goods and services is a far better metric to gauge quality of life and economic growth.
Take for example the myth of the lost decade in Japan. It was long assumed that due to deflation, growth in Japan ground to a halt for two decades. Japan's money supply remained largely stable during the course of the lost decades, but due to an asset bubble bursting, increased production efficiency, and inflation in importing countries, prices dropped and the currency became, in-effect, deflationary. If one simply looks at GDP per capita, this assumption is confirmed. However, it did not, and does not, reflect the reality on the ground in Japan. GDP per capita is measured using a metric that is itself floating. It tells you very little about actual growth unless one knows the purchase power of the currency. If one instead uses GDP per capita adjusted for PPP and compares it between countries, we find that economic growth in Japan was relatively equal to that of the US during the lost decades, despite GDP growth per capita being far lower. Why did no deflationary spiral occur? According to all traditional Monetarist theory, it should have, and did. Once again, if one looks at GDP they see less money going into assets and money being "hoarded". But the problem is that we are conflating the financial and equity markets with the whole economy. "Hoarding" is simply an ugly way of saying saving or spending on consumer goods and services. While, Japanese consumers increasingly decided against loaning money to banks or businesses, they still purchased goods and services at a good pace. While the standard irrational exuberance of the modern equity markets may have been curbed, leading analysts to declare that Japan was in a deflationary spiral, the average consumer became better off. The financial markets were now forced to follow the market's real interest rate, as opposed to that imposed by the Central Bank. This drew money out of speculative markets, which in the dogma of modern financial analysts is tantamount to the apocalypse, but in reality benefits savers and investors.
The US dollar is deflationary against almost all goods and services from abroad. In the logic of the "deflationary spiral" argument, no one would ever buy these goods because they could buy more at a later date. The same goes with electronics, which have experienced price deflation for decades. What this obviously ignores is the subjective value placed on time by a buyer. A car bought next year is worth less than a car bought today because I get one less year of time-usage from it. This can create periphery costs as well. For example, what are the costs to my business by putting off purchasing the car? Will I need to take public transportation? What enjoying will I miss out on? These are all subjective metrics, but suffice it to say, If the value placed on the usage time of the item by an individual outweighs the value to them which can be expected from an increased value currency, then they will spend it, regardless of its future value. Time has value.
Another example is that of the latter half of the 19th century, a time of deflation and also the greatest economic expansion in history. During a forty year period US real economic growth grew over 400% meanwhile prices actually fell 12%. The great depression is usually cited as the best case for the danger of a deflationary spiral because it occurred during a deflationary period. Yet, if it was deflation that led to the depression, surely it would have also occurred in so many other instances. And yet it didn't. This make it rational to assume that it was perhaps correlation during the depression rather than causation. A much more powerful explanation of the causes of the depression may be the massively incompetent responses to a standard crash that were enacted by bureaucrats.
Deflation is simply a barometer. Contrary to causing problems, it just reveals them. If an over indebted company is not performing in a manner supportive of that debt it cannot paper over it with an inflating currency. Inflationary environments naturally favor borrowers over savers and investors, deflationary environments turn this on its head. It is no wonder that borrowers are so prone to declaring it the greatest evil known to man. But one man's "deflationary spiral" is simply another man acting on his preferences with the benefit of access to real interest rate information. If he chooses to loan the entrepreneur money, he will be doing so based upon good information rather than on the premise of a distorted artificial bubble. Lending still occurs in such environments, it is just much more advantageous to the investor because firstly, they are not punished for not investing, and secondly they are doing so with information on real rates.
JoelQuinn reacted to KarmaCoverage in Balance sheet operations of a cross-border settlement process with the use of XRP
@tar Fantastic job! One visual critique, on the last page, showing the before and after balance sheet impacts, for Pger you got rid of the line item for "Claim against Pusa" instead of showing it's balance reduced to $0. Otherwise you did a excellent job. Thank you
I said I was going to make a video on this but then I saw Ryan Zagone's video and he explains how the process works with a balance sheet example.
If this were settled via CBDC the CB would be involved, and presumably Busa and Bger would be operating as a Narrow Bank (at least with regard to their CBDC assets on deposit).
The change would be at the step where the (narrow) bank changes ownership of the liability from Pusa to Musa, because the ownership change would be on the Central Bank's balance sheet (theoretically)...
in reality the CBDC will be held in custody accounts, so in that case just assume Pusa and Musa hold accounts on 2 different institutions. The actual change on the CB's balance sheet would be observable when the CBDC moved from Pusa's bank to Musa's bank, who both hold an account on the CB's balance sheet.
You made me realize that if these MMs both have loans with Ripple for XRP inventory...
A MM who operates in a corridor with a net outflow they can borrow from Ripple A MM who operates in a corridor with a net inflow may want to pay down loan from Ripple This makes Ripple's balance sheet the one completing or connecting the two ends of the "full cycle" (so everything "balances out", double entry accounting and all that)
I didnt read all the comments in this thread, but there seemed to be some confusion about the difference between how Interledger Protocol is used in RippleNet vs how Interledger Protocol is used in the Internet of Value. This is the Universal (sequential execution) vs Atomic mode (simultaneous execution) issue, which is off topic for this thread but in short. Here is a good thread on this.
In Atomic mode, everything is executed simultaneously so there is not any "settlement risk", therefore I see the argument that no credit creation has occurred, transaction data is validated and agreed to before any value movement occurs. Then all the value changes hands at the same time. I guess you could say the "agreement" creates a momentary chunk of credit, but one which is immediately settled. Atomic mode requires a Validator or Notary, I think Ripple plays this role in RippleNet, but maybe not, idk.
In Universal mode, payments are sent with an unknown unguaranteed path which is found via forward routing, just like the internet sends data packets and if a few get lost you just resend those few. With Streaming Payments the MMs are acting like an ISP who just passes the packet on to the next guy.
If a MM passes a payment on and the receiver does not send back a confirm message, then the MM has just
conditionally accepted $5 from bob to send it further down in the right path then passes his own $5 on to Alice, who is supposed to pass back a confirm message, which allows the MM to meet the condition with Bob, and collect or settle the $5. Bad Alice never sends the MM a confirm message, so Bob rescinds his offer to give the MM $5.... and the MM is out $5, fleeced by Alice. (this cannot happen in Atomic mode) Smart MMs stop doing business, or routing payments through Alice, as long as the loss is small and fast (could be due to technical issues) then the risk of loss to the MM is controllable. The IoV runs in Universal mode and there is not a role for a Validator or Notary in Universal Mode.
The name for MMs in the IoV is Connectors, they are the ones who hold a balance and an account on both ledgers that are being Connected.
One subtle thing that is easy to misunderstand (because it seems like value is moving, that is the whole point right?) ...is that, The money never moves, it always stays on the same balance sheet, (the bank debiting Pusa and crediting MMusa = same balance sheet).
When you visualize this as a network graph, think of the nodes being connected as Ledgers or balance sheets, and the connections or network edges as MMs acting as "Connectors". I think most folks tend to think of the MMs as the nodes or "actors", and the ledgers as the connection or edges, but that is not reality.
To drive that point home, XRP cannot be removed from XRPLedger. Same applies to cash fiat accounted for on a CB's ledger (not true for Private Bank deposits, they live on the bank's ledger). You cant take cash fiat off the CB's ledger, that is where it exists. In both cases you can change ownership of the XRP or cash fiat, but not which ledger they are accounted for on.
JoelQuinn reacted to jag216 in The impossibility of liquidity in xrp
It is true that by providing credit to borrowers, banks bring money into existence within limits. There is a meager reserve requirement, and there are underwriting considerations and risk management calculations that try to anticipate the risk or lending - this must be done, because the black swan in the financial model is the level of honesty and accuracy provided by the borrower and audited by the underwriter.
Money is created as credit in the debt-based economy. We can maintain liquidity - keep unencumbered money in the system - by lending indefinitely. This is the inflationary force within money - it's not based on productivity or the value of assets, but the amount of credit that can be issued without creating systemic risk.
This is how money is created, and it is certainly elastic. How is money destroyed? 1) The debt that was used to justify it is paid off. 2) The debt that was used to justify it is either forgiven or cleared through bankruptcy. 3) The money is used to pay back interest to the reserve banks.
Under a rigid system, as stated above, there is a potential for a deflationary scenario. This is a very serious problem in finite currency pools that are locked tightly to hard assets. The reason is that bank charge interest as part of doing business, and investors expect interest as well to justify the level of risk involved in depositing their silver/gold in the bank.
The problem with interest in a fixed system is that it opens the doors to usury - while a bank might create money - redeemable tender - that represent claims for hard assets in their vault, there is no way to make the money to pay the interest! As a result, banks charging interest will eventually force a certain percentage of their borrowers to default, resulting in collateral for loans being confiscated and the banks not only were getting interest from the person who defaults, but in the end they get the underlying assets too!
Which is why you have so many banks interested in loaning you cash advances on your digital assets. They know a certain percentage will eventually default, and they will get the collateral digital assets at a very cheap price - but the money they created and gave you as an advance on your assets did NOT come from the value of your asset, but on the basis of your creditworthiness. And it is why I warned many many months ago against doing this.
Once banks start calling in their loans and people start defaulting, investors start panicking - there are runs on the banks, people rush to gather their assets. In a fixed supply system, this creates severe deflationary pressure - under the gold standard this led to severe depression because although there were goods and they were cheap, there was no money to buy them because of hoarding. Essentially all the banks had their margins called in at once. Everything ground to a halt.
In terms of an elastic money supply, we saw in the savings and loan crisis and the mortgage debt crisis that there are other tools that can be used to balance the inflationary and deflationary forces. Quantitative easing provides an inflationary force - extending a special credit window at 0% interest to encourage liquidity and allow banks to continue issuing credit. Raising interest rates provides a deflationary force - it causes the money supply to contract. Even in a debt-based system, the money to pay interest is never created as part of the loan - you get the principal, but when you pay it back you have to come up with the interest some other way. This scrapping for interest creates deflation.
But these are remarkably open ecosystems. People accept cash in so many ways, they trade value in so many ways. Some folks use barter - and work outside the money supply but still transfer value back and forth. Some neighborhoods develop local scrip they can trade - labor hours, etc. Folks are very creative about transferring value.
This is entirely different from cryptocurrency ledgers, which make them so interesting. We visualize cryptocurrency changing hands, but in reality it is more like gold in a vault - people can purchase title to it, but it stays in the vault. People can exchange titles, etc. But all that really happens is that coin balances get assigned to different owners. There is no cryptocurrency that has no owner. There is no 'loose change' out there.
In this way, I view cryptocurrency ledger like the cooling system in a nuclear reactor. Fiat currency markets are the uranium - the reactive material that produces the heat. But the cooling system, aside from needing to vent to maintain stability, is a closed system. In a perfect system, the radioactive water would be permanently and safety sealed. It's purpose is to transfer the heat from the core engine to the turbine to generate electricity.
The interfaces - where heat is transferred from the core to the turbines and eventually out of the tower - these are the fiat to crypto exchanges. The cryptocurrency as it is designed in XRPs case is not designed to be a currency - it is designs to be a digital asset/token that relies on the circulation of its own ownership transfers to keep the convection current of value moving.
What is remarkable about this asset, is that as more value is transferred - as more exchanges occur - the system does become less efficient - it gets more efficient. This is what is so strange about the model.
In the nuclear reactor example, if the water temperature gets too high and causes instability and the cooling system ruptures, pressure is relieve and water boils off - causing a meltdown. Overheating of the water causes problems. But if the water doesn't move, you have the same problem! Electricity can't get produced.
I am sure there is an ideal heat for the XRP ledger market. There is likely an ideal operating XRP token value and transaction cadence. We are nowhere near it, but speculative attempts to dislodge the system are sort of like someone sitting outside the coolant pipe with a blowtorch trying to heat up the water.
My point is, XRP is not a currency that can escape the ledger. It is water trapped in pipes, which is why there is only so much of it. It is not, by design, a daily usage currency. This has been said over and over again by Ripple - they are not treating the asset this way.
That doesn't mean that others can't, but the whole interest thing? Notice that many exchanges are offering to pay interest on cryptocurrencies using homebrewed stable coins. This is the 'XRP_2' I think we are discussing, and it is already happening. Every company with a custody solution that wants to attract customers will offer their own stablecoin as interest on its own ledger.
This is what makes a project like Kin so interesting to me - they have two different liquidity loops (a forked stellar loop and an ethereum loop) connecting/exchanging with different interfaces. I think this will become a viable pattern for other business applications of cryptocurrency that want transaction and backoffice layers.
And thankfully, we will have InterLedger Protocol to transfer value across all supporting ledgers - but wait, that's more reactors, and more choices of cooling systems. Will efficiency always win out over popularity and politics? Who on earth knows...
So what do we own exactly, in XRP? We own the water in a hydraulic system for transferring value between reactors.
Not a currency. An asset/token. But still super weird/crazy.
JoelQuinn reacted to PG1 in Visa buys earthport
b2b connect may be integrated as an Earthport solution.
You can look at that a different way. The value to Visa is network reach. They reduce barriers to signing up and installing b2b connect.
IDK, it's just not clear to me at this point whether Ripple will benefit from this acquisition.
JoelQuinn reacted to KarmaCoverage in Visa buys earthport
Is this the beginning of the phase of the Crypto markets maturation where some of the big boys decide it's best to buy an exchange (rather than build one like ICE & Fidelity) just to get into the market?
Visa just gobbled up one of most Ripple experienced teams & tech out there.
Earthport was one of the original "Gateways" back when Snap Swap was still around.
JoelQuinn reacted to Montoya in My Address to Mr. Brad Garlinghouse, CEO of Ripple
Not exactly going to make a compelling argument for economic liberalization with a name like that, lol.
JoelQuinn reacted to WrathofKahneman in Full Presentation with Yana Novikova of Ripple Introduction to XRP and XRP Ledger
so interesting note - doesn't have to mean much - but the powerpoint this uses lists the NSA under "regulation". The same powerpoint a couple of months earlier does not list the NSA. Have they had interaction since last spring, and if so, why?
JoelQuinn reacted to Tehol_Beddict in Mastercard’s Homesend
“Homesend’s quite into tokenization and potentially digital assets as well. Both of those homesend would be able to support, whether that be sending or receiving. Much the same as blockchain. Homesend’s done quite a lot of experiments with Ripple as well... in the homesend and mastercard realm. This wouldn’t be competition to what we’re doing with banks...”
JoelQuinn reacted to mDuo13 in How much is there actually to save on large remittances?
If financial institutions decide to pass their savings onto customers, then the XRP ecosystem and Ripple in particular will have achieved a great thing, especially for those who're sending home remittances with small incomes.
If they don't pass on their savings, then we're not done until we find a competitor who will.
If enough entrants in the market are able to reduce their costs, eventually someone will want to gain market share by undercutting their competitors. I don't think Ripple is offering exclusivity agreements for this tech and that's why.
JoelQuinn reacted to LilBender in Western Union's Ripple Labs Tests Ongoing
An NBFI of the size of WU will not be looking at DA based instant liquidity as a last mile solution
It will be beneficial for them to eliminate their internal NOSTRO accounts, at least partially; not for sending every low value remittance via xRapid
For this purpose, I believe a solution like xVia is more suited for their purpose (Something that was not available in a finished form during the original WU tests)
The regional hub can pool the incoming funds, batch process an xVia payment at regular intervals (Say, weekly) and the country subsidiaries will receive a fresh batchof local fiat with which they replenish their pool. Vice versa for outgoing transfers
That's a grossly simplified example, but in a nutshell, batched internal payments make more sense to them than a customer facing, low value, high frequency one
JoelQuinn reacted to Tripple in Look whats on the IMF website!
Pacific Financial Inclusion Programme
Ripple has long-standing interactions with both Westpac and Commonwealth Bank of Australia, which is interesting because the Australian Government contributes finances the PFIP programme, along with with United Nations Development Fund and a couple of other lofty entities.
IBM and Stellar were clearly targeting the same Pacific corridors, announced in October '17, so obviously financial inclusion is viewed by a number of players in the space as an enticing route to market. The fact that Ripple is a major contributor to the Mojaloop programme for African nations is another nod in that direction.
Perhaps the IBM/Stellar/KlickEx Group solution is just not mature enough to solve the friction points that they intend to solve. That would make some sense considering how many entities need to collaborate to build a working solution (not to mention the fact they'd have to trust Jed McCaleb). Ripple is a single entity that is laser focused on solving these issues, has commercial-grade software that already been brought to market and is gathering pace in terms of adoption and reach.
Clearly Ripple's xCurrent solution has beaten IBM/Stellar to the punch - and the document on the IMF website hints that Pacific Island Central Banks may intend to use xCurrent to solve these financial inclusion issues. That's good for XRP holders, as it's quite an isolated set of nations (high-friction for cross-border payments and remittances), so they may seek to use digital assets to open up their economies to broader, frictionless trade.
JoelQuinn reacted to Tripple in Look whats on the IMF website!
Says "Samoa Session 2" in the URL. Looks like Ripple is going after the corridors that IBM and Stellar claimed to have on lock down.
Interesting that it's on the IMF website. Perhaps Samoa (or a number of Pacific islands) could be exploring the option of using XRP as a currency, which the IMF would then be able to hold.
JoelQuinn reacted to Asen4XRP in Look whats on the IMF website!
Check out the following Presentation on Ripple and XRP on IMF website and the 3 dayes starting this Sunday on page 6. What do you all make of it?
JoelQuinn reacted to KarmaCoverage in Instant Property Market
@Julian_Williams earlier in that video he discusses real estate titles going digital.
I often use the analogy of a real estate "chain of title" to explain to non-tech folks that a blockchain stores a chain of title for it's digital asset.
There is a guy I know who has a patent suite for putting real property titles in a database, and then being able bifurcate the bundle of rights which come with the typical warranty deed.
Last I spoke to him, he sent me something from r3 about a mortgage registry, and I think there was other thinking about real property titles.
The video you posted looks like my project that I was working on around 2010, to create a network of property profiles (all all the rights, who owns what rights, & a market with a P2P pricing mechanism to reduce liquidity risk & transaction costs market wide).
I could never find software that could do what I needed. Fast forward a few years and I'm working on a P2P coverage business model for the risk markets (KarmaCoverage) but the model was getting killed by transaction costs.
Did some googling, stumbled upon PeerCover, which was using something called Ripple.. so I took a look and 😍 there it was! The software functionality I needed to do the real estate markets.
So I'm not surprised r3's Corda found real estate when they went looking for a problem after building a solution.
I guess I need to look at Corda again, from my first glance a while ago, I can see how there would be advantages over using Rippled, but I also think Rippled has some very difficult functionality to program readily available. Maybe coupling the two systems together could be the best solution.
Edit: Here is a slide from the pitch deck from early 2011. I called it, "The NASDAQ for Real Estate". Went out to SF, met with Yahoo (#2 online real estate at the time) and Trulia. I told Trulia that Zillow had them beat, because I had pitched Benchmark and Shasta Ventures I think. Anyway, just before I went out there Benchmark funded Nextdoor with several million. So I told Trulia, that if they didnt get their data into a network structure they would be beat by the Zillow + Nextdoor combo (Zillow's founder was the funding partner at Benchmark). Trulia sold out to Zillow about 9 months later.
Then Nextdoor went and screwed it up by focusing on the home occupant and pursued a "local advertising" business model. They have wasted a lot of capital IMHO. So maybe now with blockchain, we can actually see the real estate market architecture get re-engineered and some of these liquidity risks be reduced.
JoelQuinn reacted to Julian_Williams in Instant Property Market
Amongst biggest things yet in terms of potential - R3 + Corda (+ XRP as Corda's DA) together making play for the 200 trillion dollar property market.
This really demonstrates how threads of ideas coalesce into new ways of doing things on the Internet of Value
I have to credit Digital Asset Investor on You Tube for this link - I think he is making an interesting point
Its worth looking at the video put up a few days ago by Karma coverage, they are describing this sort of automated self auditing permissioned blockchain smart contract systems The FinTech Revolution - Berkeley Haas
JoelQuinn reacted to Tehol_Beddict in Google partners with Ripple partner NTT’s DOCOMO Digital to start taking payments for apps via Kenya's M-Pesa service
“docomo Money Transfer Mobile Remittance Service to Add China and Thailand”
In addition to the connections above, NTT runs a Validator on the UNL.