How will the price of XRP increase when bought and sold immediately

[Guest]

 

[Guest]

55 minutes ago, AlexCobb said:

 

He doesn't really answer his own question. He makes a good point about XRP being bought and sold in 2 different markets but his argument would be much more powerful if he described how this mechanically pushes the prices up. Talking of hype is off topic.

[Pumper]

There is much debate if xRapid will increase price or not. We wont know until deals are signed companies actually use it.

[Kpuff]

Do you guys want a really good way to raise the price. When x rapid goes live it's going to buy the cheapest xrp on the market at that time. If everybody and I mean everybody puts up a sell price that is much higher than the current price. Say current price is 32c well if the lowest price was 35c or 40c or higher. Put up your sell orders high as hell. Cause it's going to go after the cheapest first. Just something I thought about that would be funny. It could be a great strategy going forward

[enrique11]

You're only holding the crypto for 5 seconds at most..it will be a while before actual usage (not speculation) and stability (for FIs to hold XRP, XLM as stores of value) show the 'true' value of XRP, XLM.  These are projects that will take roughly 10 years to mature.

[Kpuff]

11 minutes ago, enrique11 said:

You're only holding the crypto for 5 seconds at most..it will be a while before actual usage (not speculation) and stability (for FIs to hold XRP, XLM as stores of value) show the 'true' value of XRP, XLM.  These are projects that will take roughly 10 years to mature.

It will definitely take time that is for sure. The real question is. How long can you hold on?

Edited August 27, 2018 by Kpuff

[Guest]

9 minutes ago, enrique11 said:

You're only holding the crypto for 5 seconds at most

It's important to define "you" here:

"you" being someone that does not wish to hold crypto, but only wishes to make a payment from fiat X to fiat Y.

that someone is paying fees to someone else that holds XRP.

if that someone needs to make a lot of payments, he can save half the fees by holding XRP himself.

[Flintstone]

3 minutes ago, lucky said:

if that someone needs to make a lot of payments, he can save half the fees by holding XRP himself.

This is why AirBnB and Uber are used a lot in examples.

[ADingoAteMyXRP]

This question was answered last year, but it keeps popping up. Search, guys!

Entities will hold XRP. Not just banks, speculators and FI’s, but market makers and exchanges. That’s kind of their job. No one is sending the same zerp back and forth across the planet 24 hours a day. XRapid creates utility which creates an entire ecosystem built out of that demand.

”Why will the price of arrows increase when all the armies of the world start using arrows? Won’t they just use the same arrows they got shot at with?” I mean... sure, they could. But if you don’t see how the price of arrows increases in that scenario, I can’t help you.

[ZIGXRP]

Bought and sold, bought while being sold, and repeating constantly as value moves. 

So depending on how much the pool of XRP needs to be for the amount of value moving in and out in a steady flow is your price of XRP. 

The higher the sustained volume of value in motion, the higher the price needs to be. 

Whats value in motion? Banks, FI, cross border payments, W3C payments, streaming payments, all these contribute to “value in motion”. You can’t think of it as a single instant buy/sell txn, but a steady incessant flow of funds into and out of XRP. 

[enrique11]

1 hour ago, Kpuff said:

It will definitely take time that is for sure. The real question is. How long can you hold on?

I have other cryptos...since I do cryptos full time, I have to rely on active-income (mostly POW-based coins, masternodes, etc.) and passive-income cryptos (e.g., cold-staking, inflationary, etc. coins) until XRP, XLM mature and stabilize sufficiently to be used as stores of value.

Depends on patience too...what good is having a high net worth if you go to your grave having never spent any of it?

Edited August 27, 2018 by enrique11

[enrique11]

1 hour ago, lucky said:

It's important to define "you" here:

"you" being someone that does not wish to hold crypto, but only wishes to make a payment from fiat X to fiat Y.

that someone is paying fees to someone else that holds XRP.

if that someone needs to make a lot of payments, he can save half the fees by holding XRP himself.

When I say "you" it's primarily in the context of banks.

Edited August 27, 2018 by enrique11

[mrhat75]

Galgitron already roasted this turkey

[Hodor]

5 hours ago, Plirf said:

but his argument would be much more powerful if he described how this mechanically pushes the prices up.

I've seen some creative FUD by Bitcoin maximalists as we keep crossing their points off the list, but "XRP is too fast to increase in value" pretty much takes the cake. 

I've addressed this before in other threads, but it keeps coming up, because it's one of those concepts that, when somebody tells you it quick enough, kind of like a charlatan, and you don't have time to think it through, or you've had a beer or two, (or smoked something... whatever), it sounds like it could be true. 

Quote

After all, if a sale happens in seconds, and the XRP is only off the market for a few seconds, maybe it doesn't increase price, right? 

Common Sense Test

You actually don't need to even work out the 'mechanics' because it fails the bullsh** test right out of the gate:

If you have a system, with all variables remaining the same except for the number of transactions, and then you go from -0- transactions to, let's say 100,000 transactions per day, this FUD would have you believe that the initial price will not move, even though the demand on the network has increase X 100,000. 

Right there you should stop and immediately discard the idea. 

But okay, let's continue this charade a bit further. 

Detailed Mechanics Test

xRapid works to 'lock in' all fees up front, right?  That means that the user - a remittance company perhaps - has to reserve an offer and bid on both the incoming and outgoing side.  That action - the reserving of a bid and offer - essentially removes both, making the next transaction go deeper in both directions.  We're taking offers and bids off the book with each transaction.  That will make the first leg asset (XRP) go up, and then it will make the second leg asset (JPY or any other asset) go up. 

The only way that the price would remain unchanged is if there is zero overlap of all transactions, which is a ludicrous assumption, and it would imply that only 28,800 transactions happen per day (total seconds in a day divided by only a 3 second settlement time), using the exact same amount of XRP.  When I say 'zero overlap' it's because if one transaction overlaps even for a half-second, then the second transaction must push the price of XRP higher in the order books.  So for there to be zero additional demand (net) there can be no overlap.  (which is ludicrous)

The other assumption inherent in the FUD is that each transaction will have only one offer or bid that absorbs the entire amount of the transaction, without having to go deeper in the order book.  In other words, if multiple offers of XRP exist, but they are staggered at higher and higher prices to meet the size of the transaction, it will force upward price movement.  For example, what if a large transaction for a car is put through?  It will need to (most likely) access a variety of orders, forcing a temporary price rise in XRP, no matter if it settles on the other side. 

@AlexCobb introduces yet another FUD-busting point; if the two legs of the transaction happen on different exchanges, the price will be impacted, even in the case of a ridiculous 'no-overlap' assumption - because arbitrage takes time - time that would then impact the orders and bids for the next transaction. 

As if that were not enough, @lucky points out that this FUD also assumes that no institution will ever want to hold a bridge asset, which is yet another ridiculous assumption.  Banks and large corporates like Amazon hold enormous sums of bridge assets in their nostro-vostro accounts currently.  And central banks like China are even more dramatic in this vein - China has held at numerous times up to 3 trillion dollars worth of USD. 

So there's the mechanics. 

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This FUD has

1) Failed the common sense test and also

2) The detailed mechanics test

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Now cue the attempted "gotcha" points like when I explained this last time...

Edited August 27, 2018 by Hodor

[Cryptsycrackers]

Damn Hodor, slammed the door in the face of all that FUD.