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teddybear

The argument against "One day I'll deposit XRP in my bank"

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Very simple: unscalable KYC/AML procedures.

Imagine you were to send XRP from a wallet address to your bank. How do they know where the funds come from? Sure you can show them that you bought them at an exchange, but since the exchange transfers XRP out of a pooled account (mostly) it'll require quite a bit of work to verify that this is not dirty money.

With a fiat transfer from "shady country account" to "good reputation country account" at least there's a country, a bank address, an account holder name or an account holder address to check and potentially block. 

With any transfer, be it fiat or securities, SOMEONE needs to do the KYC/AML. So, for now, as long as exchanges send from pooled accounts, this "I'll send my zerps to my bank one day" is a pipe dream. Go work in a bank and see how they freeze a $10k worth of security transfer from a US based custodian sent  to a European custodian and you'll understand that it is completely unrealistic to send cold wallet stored / exchange stored XRP to your bank.

It's gonna be fiat to fiat for a long time.

 

Go ahead, prove me wrong ;)

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Just a thought... Send the zerps from your cold wallet to a reputable exchange where you are verified and then from there to your bank account.

Also if you have purchased XRP from exchanges with fiat then you should be able to provide "paperwork" for those transactions. Of course if you've been daytrading a lot then it will amount to lots of "paper". Maybe just export all your transactions into a 100MB csv file and let the bank sort it through, better yet, print it out and let them sort that through. ;)

 

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Great post, and never considered that.

Best case scenario is that if an Exchange purchased XRP directly from Ripple, and your withdrawal from that exchange comes from that stack of XRP,  it's at least verifiably not dirty money. Things get iffy when third parties like ourselves deposit into that pool and muddy the waters. 

 

 

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1 minute ago, Phintech said:

still

I have a problem with that word. Not sure where you picked up that position in my posts. XRP to me is an asset with a utility.

All I did was presenting an argument against easy transfer to your bank account.

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3 minutes ago, RippleEvangelist said:

Just a thought... Send the zerps from your cold wallet to a reputable exchange where you are verified and then from there to your bank account.

Also if you have purchased XRP from exchanges with fiat then you should be able to provide "paperwork" for those transactions. Of course if you've been daytrading a lot then it will amount to lots of "paper". Maybe just export all your transactions into a 100MB csv file and let the bank sort it through, better yet, print it out and let them sort that through. ;)

 

My point is not "how to prove source of fiat funds", but "how to prove source of XRP funds".

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Just now, Phintech said:

I guess my argument to that would be that you’re trying to figure out how to fit XRP into the old banking system, which I believe will drastically change over the next 5 to 10 years.

Let's put it another way. I'd be happy to see a KYC/AML solution for the problem.

Maybe we'll see it.

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1 minute ago, RippleEvangelist said:

Source of XRP funds is proven by the source of fiat funds if those XRP funds where purchased with fiat.

Yeah... but they pass a pooled account (the exchange). That's the problem.

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2 minutes ago, RippleEvangelist said:

Source of XRP funds is proven by the source of fiat funds if those XRP funds where purchased with fiat.

Ok, then go ahead and illustrate a fully transparent flow of funds, where ultimately XRP lands in your bank account.

See? You can't.

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Just now, teddybear said:

Yeah... but they pass a pooled account (the exchange). That's the problem.

The exchanges I've used provide means to export your personal transaction history. That should be sufficient in most cases unless you are laundering money or doing otherwise illicit stuff. :)

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1 minute ago, teddybear said:

Ok, then go ahead and illustrate a fully transparent flow of funds, where ultimately XRP lands in your bank account.

See? You can't.

  1. I transfer $600 from my bank account to, say, Bitstamp
  2. I purchase 300 XRP at a price of $2 per XRP
  3. I wait five years for my bank to accept XRP
  4. I withdraw the 300 XRP from Bitstamp to my bank account
  5. I provide the bank with the transaction records from my bank of the $600 fiat transfer and from Bitstamp for the 300 XRP purchase at $2 each.

What's the problem?

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