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@BobWay Hello, Bob!   Welcome to this community and thank you for your contributions both at Ripple and here.  It is like getting a peak behind the curtain at a magic show!

My Question:  How do you see IBM/Stellar as a competitor to Ripple?  From my perspective, they have a chance to be Coke/Pepsi.  One of the resistance points of legacy banking is that the banks have traditionally invested in and designed their own systems and software (the spaghetti) on IBM machines.  IBM seems dedicated to not missing the boat on the hardware vs. software divide this time around.  Add to this, the banks have invested $billions in their systems that they would in large part scrap to transition to Ripple.  I think this gives IBM/Stellar a leg up in that part of the market.  Conversely, Ripple has a leg up on the non-legacy banking system and in the traditionally non-banked markets.  Jed McCaleb and Jesse Lund will be launching Money 20/20 on March 19th in Singapore and have promised an exciting announcement.  As an investor, I'm evenly split between the two.  Can you share any thoughts you have, particularly around Mr. McCaleb and how his new business might interact with his old one?  If this is a sensitive topic I certainly understand and respect any reluctance to address. Thank you!

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hey @BobWay my question is based on the following quotes ;


ripple_liquidity_one_pager.pdf - 

"Settlement Through Digital Assets (XRP)

Future Release

This arrangement allows for the transacting banks to settle payments using XRP as a digital asset. XRP’s reach into exotic corridors and average daily trading volume higher than most exotic currencies, makes it an ideal bridge asset for settling transactions between banks.

In this arrangement, each bank holds XRP as a fungible liquidity pool that can be used for payments within a number of exotic corridors without the need to hold nostro accounts in those currencies. With XRP eliminating the need for banks to have nostro accounts or foreign currency exposure, this arrangement is ideal to be used for exotic corridors."




"Instead of holding local currency in nostro accounts around the world, trading parties (banks or third-party market makers on behalf of banks) can hold XRP on their own balance sheets and use it to make markets with any other currency." 

"By consolidating liquidity to service international payments from many, disjointed, international nostro accounts into one XRP pool, respondent banks allocate less total liquidity to service the same volume of global payments. Here is how:

The bank only has to hold its domestic currency and maintain one account with XRP.

The bank only needs enough XRP on hand to service its largest expected payment obligation.

By making markets directly between its domestic currency and XRP, the bank minimizes the number of intermediaries involved and their markup on spreads"


So in the future banks will hold XRP for the exotic corridors, holding enough to service its largest expected payment obligation. Ripple "Using XRP, banks can source liquidity on demand in real time without having to pre-fund nostro accounts"


Will Banks purchase the XRP for the " largest expected payment obligation" OTC or from the Xrapid exchanges? 

How can they predict there " largest expected payment obligation" is it the continuous average large payments?, what happens if there is an unexpected larger larger payment ?

I thought the plan was to free up all value in the nostro/vostro  accounts (27 trillion)  but they will be holding XRP (in a new account) that they purchase with a portion of  the 27 trillion, for exotic corridors?

Can you give an example of the value would need to be held in a typical exotic corridor to service its largest expected payment obligation ?

Would Ripple be giving away an asset `like XRP for the banks fungible liquidity pool as an assentive ? 

Where would the custody of  the banks new XRP account be held ? polysign ;)

when banks are holding XRP will it lead to a net upward pressure on the price ? 





Edited by stuartXRP
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Hi Bob I have a question that may or may not have been asked already, Was XRP originally designed to only be the method of paying fees on the RCL while the actual transfer of value was whatever the two parties involved were transacting? If so when and why did Ripple pivot to XRP being a bridge asset?

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2 hours ago, BobWay said:


  • So what is required for crypto as a bridge currency to even be considered plausible?
    • First you have to remember, "It's a profit deal!"
    • Market makers are going to do what makes THEM the most money.
      • Wider spreads don't necessarily result in higher profits. (see zero sum game above)
      • Spreads * Trades = Profit
      • So having a lot of trades at a small spread, can easily beat having a few trades at a higher spread.
      • Deployed capital matters hugely.
        • If I need $1,000,000 on deposit and I make $50,000 a year trading, I might think that sucks.
        • If I only need $10,000 on deposit and I make $50,000 a year trading, I might think that is SUPER!
        • In fact as deployed capital goes to zero, return on investment tend toward infinity. That is fun for competitive people.
    • So let's be clear here:
      • Market makers can't quote a very narrow spread in a volatile market or they'll lose money.
      • They can't deploy a lot of capital against few trades or they'll lose the opportunity to make more money.
      • Nobody can artificially manipulate the market to stabilize the crypto bridge currency, or they'll go to jail.
      • And obviously, everyone in crypto wants their asset's price to rise overtime and never go down.
      • So without manipulating the market or even inadvertently causing the price to "temporarily" drop as you bootstrap...
    • Is a cryptocurrency becoming a bridge currency even plausible?

I'm telling you, I think it is.

I'll leave the details up to you graduate students to work through.

@BobWay Hello and thank you for your time. I was so intrigued I stayed up til 4am reading your post last night. I joined the forum only just now; bc of this thread. This is my first post here.  I saw you mention the patent you and Ripple acquired and read through it. Is this patent in relation to Xpool by any chance? Also in reference to the above post, am I headed down the correct path in thinking that in order for XRP to succeed as the bridge currency, that it would involve banks / Ripple holding XRP or something like Xpool to make it plausible? If so is this the leverage that you refer to; in an earlier post that would help Ripple have an advantage towards making XRP the bridge currency? Does the latter correlate to your patent as well? Thanks again for your time! Last question, Where do I preorder your Book? 🤠

Edited by Mackdaddy
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On 3/9/2019 at 10:39 AM, BobWay said:

Which are published is time dependent. I don't check that often, but let's see.

These were issued to me and are Ripple related. (I have one more issued patent that isn't Ripple related)

These are published applications involving me. (not the boat lift ones. I had trouble filtering the list)

Feel free to read them. They are extremely boring! I'll talk about the issued ones if you have questions. I'd rather not talk about he ones which are still pending. It turns out that it is very hard to get patents in this area. There was a decision called "Alice" a while back that constrains what software inventions are patentable.

I suppose you mean this Craig Wright. Let's take a look.

I see these US Patents. Only the top one seems to be his at first glance. It was filed in 2011 in Australia according to this, so he has been working in the space for a while. Feel free to search the Australian system if you are inclined.

There do seem to be a few pending applications as well. I'm not going to read them all.

In general, (nothing to do with the Ripple company or patents specifically) what I've seen is the space and learned from patent lawyers, is that financial patents are very hard to get (owing to Alice). Conversely, the same rulings and logic make them susceptible to challenge by (folks like the EFF) if they are over used to suppress innovation. What I've heard (outside of Ripple) is that patents are good for is building a portfolio to impress potential investors. This type of portfolio is also useful defensively. Meaning, if you own the patent, no one can challenge your use of the invention. I've heard 3rd hand that larger companies use their patent portfolios defensively via patent swap agreements. Meaning, I'll let you use mine, if you let me use yours. This tends to assure the ability to innovate for the entire ecosystem.

If Dr. Wright is saying that he'll use his patents to squash the crypto or blockchain ecosystem, I would call ******** on that. IBM is in this space and I understand their portfolio is monumental. They could bury him in challenges for the rest of his life. If he is using them to build his own credibility with investors, good for him.

Key to the patent somewhere in here?!? - no? :search:

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Just a general FYI for all:

I have gone back and re-read some of the posts here to try to get a better general understanding as my brain is not very spongy.... in doing so, I realize that posts appeared that I did not see previously... they tend to pop up out of order under heavy traffic it seems... my point is that might be why some questions weren't seen/replied to... 

Also, this whole thread is bitter/sweet!

Sweet, obviously due to the wealth of information being passed around....

Bitter, because I can't get any f***ing work done!!!   Will you slow it down a bit!!!!???

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1 hour ago, BobWay said:

But until that time, someone cleaver should be able to work out which of (only two) patents I've linked that it is.

@BobWay I believe he already linked the 2 that have been issued here:


#2 “Resource Path Monitoring” talks about “resource paths” and “resource pools” potentially having to do with pathfinding and or xPool (not sure if Ripple has ever confirmed xPool to actually exist)? I know Ripple owns a trademark on xPool so it’d be awesome to learn more about it (if it’s something that actually exists, or whether they were just “defensively” getting trademarks for some possible future project) 

I’ve only briefly skimmed these so let me read them more in depth and come back to this as I could be on the complete wrong path here. Once again thanks Bob!

Edited by Ryyy20
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FFS people can we please not quote EVERY ******* WORD in our replies.   :) 

phew that felt good...    :) 


If you reply please just highlight a small relevant part of the text then click on Quote Selection to start your reply.  This thread is long enough...   :) 

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16 minutes ago, BobWay said:

You are on the right track, but I wouldn't use the word "kickback" literally. There is no direct "payback" value flow.

However, as you've pointed out, the goal is deep liquidity with narrow spreads in each XRP market.

Would / could / should there be any issue in Ripple loaning XRP to Market Makers with the intent on facilitating sufficient market depth at the sharp end to enable true stability? I'm thinking along the lines of let Market Maker 1 have 100million XRP... and the repayment is for the physical XRP themselves, not the $ equivalent. Therefore no risk for the Marker Maker.

The million dollar question, which is by no means new, seems to remain. Chicken & the egg. Can you obtain the stability for mass adoption, when mass adoption is the way to bring stability? 

Edited by XRP-JAG
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5 minutes ago, Mackdaddy said:

@Tinyaccount I apologize for quoting the entire passage above. I am new & that was my first post. I actaully tried to shorten it and could not figure out how. Anyway, hopefully I will learn how before posting again.

No need to apologise..   all good.  New members especially are welcome,  and if they are willing to learn as you clearly are,  then that’s even better.

Even our much esteemed host here is guilty of just clicking reply... but I’m not game to chip him for it in case a bolt of lightning strikes me.   :) 

Wait...   @BobWay cant see this post can he?  Oh crap....    :) 


You can always go back and edit your own posts if you want to shorten it up a bit.  Also a long unneeded quote is still welcome...   but a short one is better.   :) 

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