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solid102

xRapid Liquidity question

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So as we all understand xRapid should it function as it is designed will be able o cut down transfer time and settlement time as well as lower fees and eliminate the need for Nostro/Vostro accounts. I do have one burning question regarding xRapid. Assume below is a xRapid transaction:

 

Client 1 uses xRapid to send money from Brazil to Thailand to Client 2

xRapid takes that money goes to an exchange buy the xrp equivalent of the money

xRapid sends  the xrp from the exchange in Brazil to the exchange in Thailand

It then sells the xrp on the exchange in Thailand and transfers the money to Client 2 account

 

Now my question is when the xrp gets to the exchange in Thailand it has to have someone willing to buy it there in order for the entire transaction to go through. Say the xrp arrives at the exchange and there are no customers for it will the transaction stop? If not and it is sitting there waiting for a buyer what happens should the price of xrp tank or moon?

 

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41 minutes ago, solid102 said:

So as we all understand xRapid should it function as it is designed will be able o cut down transfer time and settlement time as well as lower fees and eliminate the need for Nostro/Vostro accounts. I do have one burning question regarding xRapid. Assume below is a xRapid transaction:

 

Client 1 uses xRapid to send money from Brazil to Thailand to Client 2

xRapid takes that money goes to an exchange buy the xrp equivalent of the money

xRapid sends  the xrp from the exchange in Brazil to the exchange in Thailand

It then sells the xrp on the exchange in Thailand and transfers the money to Client 2 account

 

Now my question is when the xrp gets to the exchange in Thailand it has to have someone willing to buy it there in order for the entire transaction to go through. Say the xrp arrives at the exchange and there are no customers for it will the transaction stop? If not and it is sitting there waiting for a buyer what happens should the price of xrp tank or moon?

 

xRapid doesn't work that way. It's all or nothing. xRapid transactions must meet kyc/aml or it doesn't attempt to perform the transaction. xRapid must have the amount of xrp to buy from on the order books or it doesn't perform the transaction. xRapid must have orders for fiat or it doesn't perform the transaction. xRapid must know the entire cost including fees or it doesn't perform the transaction.

If any of the requirements aren't met when a client prepares for a remittance, including names, addresses, values, etc, xRapid will not start the process and it fails because it doesn't meet the requirements. 

Everything is determined before the moving of value starts. 

Edited by Guest

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41 minutes ago, LordVetinari said:

xRapid doesn't work that way. It's all or nothing. xRapid transactions must meet kyc/aml or it doesn't attempt to perform the transaction. xRapid must have the amount of xrp to buy from on the order books or it doesn't perform the transaction. xRapid must have orders for fiat or it doesn't perform the transaction. xRapid must know the entire cost including fees or it doesn't perform the transaction.

If any of the requirements aren't met when a client prepares for a remittance, including names, addresses, values, etc, xRapid will not start the process and it fails because it doesn't meet the requirements. 

Everything is determined before the moving of value starts. 

Thanks for the clarification Lord. To summarize the gist of the answers in this thread regarding who will purchase the XRP when they arrive is that it is going to be the market makers. My question is who are these market makers or liquidity providers and do we have an example of a major one.

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25 minutes ago, solid102 said:

My question is who are these market makers or liquidity providers and do we have an example of a major one.

Just as an example, Ripple has partnered with Bitso, which acts as the corridor for remittances into Mexico. Anyone who puts an XRP sell offer on Bitso is potentially a liquidity provider for an xRapid transaction. You can be one if you want to. Just sell XRP on Bitso. 

As far as major, I would expect Bitso itself is one of the largest but again, it could be anyone with a Bitso account and a big ol' bag of XRP.

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Also, conceivably as I understand banks will have business relationships with private party market makers (companies)- who they contract out to (or even own as in a subsidiary) who are compelled to perform these actions of buying and selling.  They skim a small fee off of each transaction.  This is what would be called "liquidity"- as in, there would have to be entities willing to perform this function in order for the pre-sell aspect of XRapid to go through.  Someone please add/correct if I am off base.

Market makers are not the general retail public, just "whomever"- they are designated entities assigned this task in exchange for a fee.

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1 hour ago, xrphilosophy said:

exactly who they are, and how they are sourced. 

Who they are isn't difficult to figure out. Simply, a market maker is any company or individual that places orders on both the buy and sell side. There's really no other criteria required.

If people wish to know the identity of market makers, well, that may not necessarily be information the public is entitled to. 

Likewise, how they are sourced isn't really a mystery either. Any individual or company can buy XRP on exchanges or OTC. 

 

Edited by Guest

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2 minutes ago, LordVetinari said:

Who they are isn't difficult to figure out. Simply, a market maker is any company or individual that places orders on both the buy and sell side. There's really no other criteria required.

If people wish to know the identity of market makers, well, that may not necessarily be information the public is entitled to. 

Likewise, how they are sourced isn't really a mystery either. Any individual or company can buy XRP on exchanges or OTC. 

 

What is in it for them to place orders on the buy and sell side? Would they somehow make money from the fees or something?

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2 minutes ago, solid102 said:

What is in it for them to place orders on the buy and sell side? Would they somehow make money from the fees or something?

Exchanges get the fees, booo fees!

But as a market maker you buy low and sell high. It's a very simple concept.  Due to volitility, one can buy 1000 xrp at 0.300 and sell the same 1000 xrp at 0.305, that $5 profit. Buy another 1000 xrp and sell it again. Do that with a bot for 24/7/365. It can be profitable. 

Obviously in reality, it's not so simple, there is risk and fees but that's how it done. 

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So right now the market makers are the bots everyone hates?

This comment was meat for humour with a slight bit of seriousness.

Edited by peanut56
It was meant to be funny.

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3 minutes ago, peanut56 said:

So right now the market makers are the bots everyone hates?

Many of them are. Try to find smaller exchanges that have wider spreads and low or no fees. I trade in my spare time while watching TV with as little as 100 xrp and can make about 50-100 xrp per month. It's not much today but if I'm gonna be waiting, I might as well make a few xrp while I wait. I look at it as kind of like the guys who mined a few btc per day 5 years ago. No one knows what the future holds. 

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Here's more on market makers from Ripple:

https://ripple.com/insights/the-true-cost-of-moving-money/

https://ripple.com/insights/market-makers-and-the-art-of-liquidity/

"With Ripple, market makers—specialists in international funds settlement liquidity—bear the burden of providing optimal efficiency. In other words, let the specialists specialize.

By providing a marketplace for settlement, Ripple allows market makers to compete in order to provide banks and their corporate customers liquidity. This way, companies can focus on what they do best—build great products while selling them at better prices."

             
 

https://answers.thenextweb.com/s/david-schwartz-40Ep95/popular

David Schwartz 6 months ago

For xRapid to work, there has to be sufficient liquidity between XRP and the local fiat currency to permit fiat currency to be bought and sold as needed. A lot of this liquidity is already being provided organically by market makers. xRapid will just mean that instead of (probably) trading almost exclusively with speculators, market makers will increasing trade with market takers trying to source liquidity through XRP. If needed, Ripple would consider employing third party market makers to provide additional liquidity were existing market making insufficient.

---------------

https://www.fxstreet.com/cryptocurrencies/news/ripple-expands-its-horizon-with-4-additional-financial-firms-using-xrapid-201901141203

Seems like article suggests the partnership with these new financial firms are to utilize them as market makers and takers.

----------------

And exchanges as well as mentioned here:

https://ripplecoinnews.com/everything-you-need-to-know-about-ripple-xrapid

"For XRapid to work well, the amount of liquidity needs to be sufficient. These liquidities are provided by Market Makers, namely exchanges.

On Aug. 16, 2018, Ripple announced: “Today, we’re pleased to announce Bittrex will act as the preferred digital asset exchange for xRapid transactions that move through US Dollars. In addition, Bitso and Coins.ph will be preferred for the Mexican Pesos and Philippine Pesos, respectively."

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