XRapid

[Hodlezerper]

Does anyone actually know how Xrapid works? They talk about liquidity pools, etc...but I have yet to figure out how they're accessing that? 

Is it from an exchange? Is Ripple taking on the liability themselves with the asset? Who is providing the liquidity? Are there other partners involved? How does the pricing scheme work with their model?

It seems to be fairly opaque. Would love some insight!

 

[tulo]

None knows, but for Cuallix the little information is that they'll use Bitso liquidity, i.e. the offers in the private ledger of the exchange. How the loop is closed is not clear.

Edited January 11, 2018 by tulo

[Hodlezerper]

5 minutes ago, tulo said:

None knows, but for Cuallix the little information is that they'll use Bitso liquidity, i.e. the offers in the private ledger of the exchange. How the loop is closed is not clear.

Interesting...I would imagine this would be potentially huge for exchanges? But how do they keep the costs down to that sub-penny level if they have exchanges involved? 

This is definitely above my grasp of both the financial and technical realms. 

@protechtor Maybe you have some ideas based on your expertise of FX markets and liquidity?

[xh3b4sd]

I see it as exchanges here being liquidity providers for the payment providers. Cuallix just dives into the market and uses it for what it needs at any single time. The exchange has this liquidity anyway. The market participants are then glad when Cuallix resolves some offers in the books. It is a win win situation. 

[tulo]

1 minute ago, xh3b4sd said:

I see it as exchanges here being liquidity providers for the payment providers. Cuallix just dives into the market and uses it for what it needs at any single time. The exchange has this liquidity anyway. The market participants are then glad when Cuallix resolves some offers in the books. It is a win win situation. 

Yeah, but you have the drawbacks of using an exchange:

• fees (which reflects into spread)
• time to withdrawal
• slippage
• limited liquidity
• various problems of exchanges (down when high volume, kyc, ...)

[xh3b4sd]

5 minutes ago, tulo said:

Yeah, but you have the drawbacks of using an exchange:

• fees (which reflects into spread)
• time to withdrawal
• slippage
• limited liquidity
• various problems of exchanges (down when high volume, kyc, ...)

Towards the fees, I can imagine they have special deals when they operate on bigger volumes. 

 

Towards the rest, I think it will not be a sustainable business and die eventually in case it will not make sense. So these issues are either addressed and thus none, or this project will just die in the long run. Would be cool to have more insights here. I can imagine that Ripple Labs itself has a high stake in this story to succeed and they are glad to help wherever they can to make this work. What this means is yet to be disclosed. 

[woytow]

Are FIs not sourcing directly from Ripple rather than exchanges?

[Hodlezerper]

2 minutes ago, woytow said:

Are FIs not sourcing directly from Ripple rather than exchanges?

Ripple is not an exchange, so in the case of MoneyGram actually using Xrapid, they need to source their liquidity from somewhere. We're trying to surmise how this is happening. 

 

[Hodlezerper]

9 minutes ago, xh3b4sd said:

Towards the fees, I can imagine they have special deals when they operate on bigger volumes. 

 

Towards the rest, I think it will not be a sustainable business and die eventually in case it will not make sense. So these issues are either addressed and thus none, or this project will just die in the long run. Would be cool to have more insights here. I can imagine that Ripple Labs itself has a high stake in this story to succeed and they are glad to help wherever they can to make this work. What this means is yet to be disclosed. 

You're suggesting xRapid could die? Because exchanges are shoddy? (serious question)

Also, this makes me think of how important SBI will be in the coming months/years as they work to create a proper exchange environment and will likely allow the bridging of currency pairs via xRapid in house. Point being, I would trust them to execute better than say, Kraken. 

[woytow]

Just now, Hodlezerper said:

Ripple is not an exchange, so in the case of MoneyGram actually using Xrapid, they need to source their liquidity from somewhere. We're trying to surmise how this is happening. 

 

Thanks. So what is this talk that's been floating around about FIs purchasing XRP directly from Ripple at a discounted rate? My apologies if this question is ignorant.. I too have been wondering similar things

[xh3b4sd]

13 minutes ago, Hodlezerper said:

You're suggesting xRapid could die? Because exchanges are shoddy? (serious question)

I think we speculate here. We do not know anything. I just speak hypothetically. Assuming xRapid uses ****** exchanges the project is just born to die. This was a response to @tulo's concerns what might be wrong with exchanges. I cannot imagine Ripple Labs builds anything on top all the bad assumptions we can come up here with. 

[Hodlezerper]

17 minutes ago, woytow said:

Thanks. So what is this talk that's been floating around about FIs purchasing XRP directly from Ripple at a discounted rate? My apologies if this question is ignorant.. I too have been wondering similar things

Not a problem and thanks for the question. Happy to help. 

Companies can purchase XRP directly from Ripple at either discounted rates, or, as @Hodor has asserted, possibly even premium rates. 

These are companies that have future intended uses of XRP (Exchanges, possibly banks, maybe huge companies that want to pay out employees more cheaply? {Uber, Amazon?})

MoneyGram isn't buying a ton of XRP. They are middlemen between consumers sending money across borders. So they facilitate the exchange and supposedly xRapid takes care of the rest. I would guess that MoneyGram doesn't actually hold any XRP and may never have to? We're trying to figure out if the programs are tying into exchanges or if it's directly on ledger via exchanges? Honestly, it's sort of to the limit of my understanding to make an accurate assumption of how this is supposed to work.

The constant conversation about banks buying XRP is, in my opinion, incredibly early at best, maybe never going to happen at worst? It's possible that banking changes so drastically that we don't see banks even in the business of sending money. That may be farmed out via third party APIs tied into your accounts. (I'm talking down the line, not tomorrow). The clearest and most obvious use case for XRP right now is to send money quickly and efficiently, hence the MoneyGramp partnership being the first real deal. As the internet of value expands and becomes reality, there may be many more uses for XRP but at the moment this is the most obvious answer. 

Also, why would a bank, who doesn't necessarily specialize in sending money across borders, even purchase XRP? (This is not FUD, btw, this is just discussing current use cases). Other payment companies can farm that responsibility off to themselves away from banks and provide a peer to peer service. Or in this case, peer to business back to peer? lol. 

It is entirely possible that because of technologies like this, we see companies having to offer "free" global transfers ultimately profiting by gathering your data and selling it. (think, more realistic version of Equifax or Transunion (www.plaid.com {if anyone else has insight into this company I'd be curious}).

I know i'm off topic here, but I believe banks will start to split pretty dramatically into various services that are highly specialized that may be tied together with a couple company's APIs and maybe, hopefully, XRPTheStandard. Business lending may, down the road, look the most like banks do today, while retail services (I'm a waiter who deposits $400 a month) gets farmed out to different companies. Your lending potential will be tracked by someone other than your bank because let's face it, the banks aren't handing out personal loans very well anyway. (partly a regulatory issue). 

Anyway, I'm totally rambling and off topic now. 

The point is, there are other institutions that may have use for XRP that are buying the asset directly from Ripple, but that isn't what MoneyGram is up to. They are just the middle men between two people and therefore don't really need to own large quantities of XRP. 

 

Disclaimer: I'm not qualified to talk about this. Don't listen to me. This is not advice. Thanks. Have a nice day. Also research correspondent banking.

 

Edited January 11, 2018 by Hodlezerper

[tulo]

1 minute ago, xh3b4sd said:

I think we speculate here. We do not know anything. I just speak hypothetically. Assuming xRapid uses ****** exchanges the project is just born to die. This was a response to @tulo's concerns what might be wrong with exchanges. I cannot imagine Ripple Labs builds anything on top all the bad assumptions we can come up here with. 

I think (or I'd do it like that) that xRapid can source the liquidity from various sources. Only one of this are exchanges. 

[Hodlezerper]

1 minute ago, xh3b4sd said:

I think we speculate here. We do not know anything. I just speak hypothetically. Assuming xRapid uses ****** exchanges the project is just born to die. This was a response to @tulo's concerns what might be wrong with exchanges. I cannot imagine Ripple Labs builds anything on top all the bad assumptions we can come up here with. 

Just clarifying, and I agree on all points. Which is why I think Ripple has something up their sleeves regarding xRapid. I think they may be manipulating some stuff to make things seem different than they are. 

[Hodlezerper]

Just now, tulo said:

I think (or I'd do it like that) that xRapid can source the liquidity from various sources. Only one of this are exchanges. 

What could be some other sources?