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David Schwartz Enabling the Internet of Value | UNCHAIN 2018

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I’m a little unclear to what David means when he says one option is that XRP uses up all the available liquidity and the market dies.

Surely if all the available liquidity is used up , the price increases ?

Anyone care to clarify ? 

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23 minutes ago, XRPHornets said:

I’m a little unclear to what David means when he says one option is that XRP uses up all the available liquidity and the market dies.

Surely if all the available liquidity is used up , the price increases ?

Anyone care to clarify ? 

I believe what he's positing is that if the XRP price increases too rapidly/dramatically, then for a time all XRP holders could continue to just hold, and not put their XRP into the marketplace for use? That's the only thing I can guess...

In that case I think the market-makers could still loan XRP for transactions... IDK

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26 minutes ago, XRPHornets said:

I’m a little unclear to what David means when he says one option is that XRP uses up all the available liquidity and the market dies.

Surely if all the available liquidity is used up , the price increases ?

Anyone care to clarify ? 

Seems like he made joke, he made a facetious "worst case scenario" where the market totally dies, knowing the price would instead rise like crazy.

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1 hour ago, ImTheRippler said:

Schwartz is going to get ripped like Bezos one day but keep the long hair and the "Skullet" will become a cultural phenomenon.  Dude pulls it off somehow!

It will also become extremely unfashionable to move ones arms and then only for purely functional purposes like eating , m@sturbating .

The hippest and richest XRP bag holders will simply  pay for other people’s arms to fulfill those functions .

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On 7/14/2018 at 5:30 AM, XRPHornets said:

I’m a little unclear to what David means when he says one option is that XRP uses up all the available liquidity and the market dies.

Surely if all the available liquidity is used up , the price increases ?

Anyone care to clarify ? 

IMO the scenario is that if liquidity dries up, then the liquidity solution isn't working and customers won't be able to rely on it, and therefore won't use it as anticipated/intended.

@JoelKatz is such a unique guy. You can almost see his mind processing dozens of times faster than his mouth can cope with.

It's remarkable how he explains complex concepts so fluently. So glad he's on our team.

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32 minutes ago, JoelKatz said:

But I won't be able to prove that until xRapid volumes ramp up and we see what happens. We've done a lot of thinking and working on how we're going to monitor market response to learn as much as possible

It’s awesome that you are so generous with your responses...   thank you.  

I’ve often wondered if you guys ever trialled a mock market to see whether XRapid is neautral in effect...   I fully understand if you’d prefer not to comment on that.  

In any case as one of my heroes recently said in a talk in Germany.... (paraphrased) “We will know soon”.     :) 

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19 minutes ago, JoelKatz said:

Say xRapid users start performing a lot of USD->XRP->MXN payments. There are two things that might happen:

  1. Market makers start making more money. This attracts more market makers. Liquidity improves, spreads go down.
  2. All the liquidity gets used up. There just isn't enough "bandwidth" left in the market makers and liquidity dries up.

I don't think 2 is going to happen. But I won't be able to prove that until xRapid volumes ramp up and we see what happens. We've done a lot of thinking and working on how we're going to monitor market response to learn as much as possible so that we can make the best possible decisions about future corridors and mechanisms. Brad Chase, one of the stars on the C++/rippled team, moved to the data team to help them out with this. Initially I was sad to lose him from that team, but then I realized how awesome it would be to have someone on the data team who knew everyone on the C++/rippled team and knows how the XRP Ledger works in great detail.

Legend, thanks for replying.

 

Appreciate that where there's money to be made such voids will usually be filled & hopefully that works in the grand scheme of things, how long can/does it take for a new market maker to get the necessary in place? Hopefully quick enough to not leave customers lacking liquidity which is obviously what you're going to do all you can at ripple to ensure doesn't happen :)

 

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On 7/14/2018 at 2:57 AM, GiddyUp said:

I believe what he's positing is that if the XRP price increases too rapidly/dramatically, then for a time all XRP holders could continue to just hold, and not put their XRP into the marketplace for use? That's the only thing I can guess...

Everyone has a price though...if the price rises, people will happily dump their XRP onto exchanges to make a nice profit.  For sure though, a rising price will make a certain group of people less likely to sell.

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1 hour ago, bachmama said:

Jeeez, 7558 Points with 847 Posts, developed xRapid and still no Gold Member here. Not even Bronze. I´m feeling for David. Really. Let´s all tip our man @ Ripple!

I know, David is "legendary", right? ;)

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13 hours ago, JoelKatz said:

Say xRapid users start performing a lot of USD->XRP->MXN payments. There are two things that might happen:

  1. Market makers start making more money. This attracts more market makers. Liquidity improves, spreads go down.
  2. All the liquidity gets used up. There just isn't enough "bandwidth" left in the market makers and liquidity dries up.

I don't think 2 is going to happen. But I won't be able to prove that until xRapid volumes ramp up and we see what happens. We've done a lot of thinking and working on how we're going to monitor market response to learn as much as possible so that we can make the best possible decisions about future corridors and mechanisms. Brad Chase, one of the stars on the C++/rippled team, moved to the data team to help them out with this. Initially I was sad to lose him from that team, but then I realized how awesome it would be to have someone on the data team who knew everyone on the C++/rippled team and knows how the XRP Ledger works in great detail.

We are talking about lending, is that correct? In order for the corridor to persist, once the liquidity dries up, it needs to recirculate back, without having to spent on goods or services. 

Is there any work being done on a repo-like mechanism, which enables xrp holders to offer their xrp up at some rate of interest? I'm guessing that the strengths of a public ledger become a weakness in this case, as it's difficult to move xrp from a given public key without the associated private key, such as when enforcing the terms of a lending contract, any xrp sent to an address as a loan is extremely difficult to recover. We need some sort of mechanism that enables lending and overcomes the hurdle of risk associated with actually moving that xrp from creditor to debtor. Am I getting any of this right?   

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This is why I think xCurrent is of much more importance than the general public realizes. If all partners will be tied up in a true ‘Rippenet’ (comming in the next 2 updates of xCurrent), Ripple gets a good idea on amounts within the flows and possible corridor paths. This is vital data, which will probably be used to perform simulations for xRapid and will provide Ripple insights which corridor to operationalize first and have market makers put in some extra efforts. Once it proves to be working, more flows will be exposed by Ripple, more clients will want to save money with it, etc. That network effect will be the moment that changes the whole landscape.

It’s just a brilliant strategy. XRP is by itself already brilliant tech, but leverage it this way to deal with volatility and liquidity that no other does yet is mega smart. And I’m sure some extra tricks to improve liquidity are in the pipeline (XRP as a base pair on exchanges, usage as an idealasset for interexchange market making, etc)

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