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Ripple Has Signed Up A Bank To Use XRP For Payments. So What?

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4 hours ago, invest2lose said:

here's another point she argues regarding nostro/vostro accounts.

 

Those are serious words...  ...so, I decided to check out Ms. Coppola's other tweets.

She is a smart lady.  So smart actually, that if you were to present her with the best thing since sliced bread, she would immediately find a dozen different ways in which that particular thing was flawed and would be able to support each with clear examples of human idiocy at play.

Ms. Coppola is thus a natural critic.  

The mere fact that her criticism of Ripple and XRP still resides within the realm of skepticism (vs burying Ripple 6 feet under from the start) is a net positive in my book.  If the worst she can come up with is "they will not be that successful", then we are probably in good hands with XRP.

But, that is just my opinion.  DYOR.

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I take @automatic s point about her predisposition to attack the concept but she has raised a small doubt in my mind.

I’m now in sceptical mode...  I’m not at all sure if she is right or Brad is right about Nostro.  I’m guessing Brad but I’m open to persuasion either way.  

I do recall Brad quoting what seemed like an authoritive source at one point that had researched the ‘locked’ capital in Nostro.  

But now I’m uncertain.  

I have myself seen a FI run out of capital in its overseas account and so it was unable to process further customer transfers...   so it sure seemed liked the situation Brad has endlessly described.  In that case it was a weekend, and so nothing could be done till Mon arvo because of timezone differences.  

I guess someone will know around here and come back with useful info.  Sorry that I can’t...

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2 hours ago, Tinyaccount said:

I take @automatic s point about her predisposition to attack the concept but she has raised a small doubt in my mind.

I’m now in sceptical mode...  I’m not at all sure if she is right or Brad is right about Nostro.  I’m guessing Brad but I’m open to persuasion either way.  

I do recall Brad quoting what seemed like an authoritive source at one point that had researched the ‘locked’ capital in Nostro.  

But now I’m uncertain.  

I have myself seen a FI run out of capital in its overseas account and so it was unable to process further customer transfers...   so it sure seemed liked the situation Brad has endlessly described.  In that case it was a weekend, and so nothing could be done till Mon arvo because of timezone differences.  

I guess someone will know around here and come back with useful info.  Sorry that I can’t...

Hey Tiny,

According to Ripple itself (see: https://ripple.com/insights/liquidity-explained/) the source is a 2016 McKinsey report:

"According to a 2016 McKinsey Global Payments report, there is approximately $5 trillion dollars sitting dormant in these accounts around the world – tying up capital that could be used in more productive ways."

Link to the report:

https://www.mckinsey.com/~/media/McKinsey/Industries/Financial Services/Our Insights/A mixed 2015 for the global payments industry/Global-Payments-2016.ashx

 

HTH ;)

 

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1 hour ago, automatic said:

@Tinyaccount - I think that the entire nostro balance point is meaningless.

Hey @automatic

Sorry ... nope ... according to a McKinsey report from 2016 the average costs of Nostro liquidity (period 2013-2015) are 34% per international payments transaction

See Exhibit 9 (page 21):

https://www.mckinsey.com/~/media/McKinsey/Industries/Financial Services/Our Insights/A mixed 2015 for the global payments industry/Global-Payments-2016.ashx

Though I concur with you that there are many other arguments pro the Ripple solution :) 

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6 minutes ago, Rey said:

Sorry ... nope ... according to a McKinsey report from 2016 the average costs of Nostro liquidity (period 2013-2015) are 34% per international payments transaction

Ah, the sweet taste of research!  :D

Thank you for digging that up;  that makes the business case even stronger.

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10 minutes ago, Rey said:

Hey @automatic

Sorry ... nope ... according to a McKinsey report from 2016 the average costs of Nostro liquidity (period 2013-2015) are 34% per international payments transaction

See Exhibit 9 (page 21):

https://www.mckinsey.com/~/media/McKinsey/Industries/Financial Services/Our Insights/A mixed 2015 for the global payments industry/Global-Payments-2016.ashx

Though I concur with you that there are many other arguments pro the Ripple solution :) 

what does this mean then? why would coppola say otherwise? obviously she's a smart person and has been in the banking industry. what's missing? blatant lies and fud?

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1 hour ago, automatic said:

@Tinyaccount

Here is another angle;  approximately 35% of world population makes less than $100 per month, and ~55% makes less than $200 per month.  SWIFT charges $45-65 for a transfer.  How much money is being left on the table by virtue of never being sent because the entire amount would have been eaten up by fees?

That is what banks charge a customer. What makes you think banks will pass on cheaper costs if they can do it cheaper via xrapid ?

They will still charge the customer the same amount and pocket the increased profit.

 

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On 1/29/2019 at 10:46 AM, Panosmek said:

We already know it. It has been discussed. It's a small bank/institution and that's the point. xRapid must build volume and liquidity first and it will be from the small institutions.

My question to the author is: Why would you write such a useless "article"? Why so much butthurt?

When do you get the most flak? When you are over the target...

flak.jpeg

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2 minutes ago, invest2lose said:

competition

The bank I work for charges customers $20 for a SWIFT transfer via Internet Banking, and $32 to do it via a branch.

Our cost for standard value transactions via SWIFT GPI is 40cents, that we pay SWIFT.

 

Edited by Freaky

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Thank you @automatic and @Rey for that elaboaration and information.  

I agree that even without Nostro advantage the increased customer market space is a big advantage of XRP.  

But if it IS true that there is no real amounts locked,  then that does undercut at least one of the legs of the XRapid table.  

(I don’t think it is true though.  Especially if McKinsey is correct and 35% of fees is Nostro cost.)

If GPI delivers near real-time and lower cost transfers then it’s a harder sell to switch to a DA based technology.   However if there is capital locked then the allure of XRapid is greatly enhanced.  

Im going to assume McKinsey, and Brad, and my own experience of an institution out of capital is correct and that Cuppola just has an axe to grind for some reason. 

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5 minutes ago, invest2lose said:

what does this mean then? why would coppola say otherwise? obviously she's a smart person and has been in the banking industry. what's missing? blatant lies and fud?

Good question. The issue at hand is Ripple stating an amount of $5T that can be released, while Mrs. Coppola states that that amount is just a flow.

First, tbh I haven't seen the number $5T mentioned explicitly in the McKinsey report, even though that number hasn't been debated itself.

Second, if $5T would be flowing continuously, one could argue that it's actually locked ... so we'd need to know the volume that flows per time period.

 

I don't know enough about Mrs. Coppola in order to be able to say anything about her motives and objectives ...

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