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Dutch_ins

European Central Bank integrates RippleNet on 22-11-2021

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6 minutes ago, Dutch_ins said:

Crypto assets are not CBDC's. The BIS's money flower gives some insight.

Money_flower-2.png

You are right. “Crypto asset” is a much broader definition, but they include CBDCs imho. My logic: just as cash is an asset class in itself, crypto asset can mean any dlt based cryptocurrency, including CBDCs. 

Maybe my understanding of crypto assets is not correct though. Do you have another definition for it, that makes it clear that CBDCs are not included?

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2 hours ago, Paradox said:

How much is RippleNet integration and licensing?   My understanding is that it  can run into the millions, which would support my previous notion of not making economic sense in certain cases. 

My understanding is that for these companies that don't have the volume and therefore the need to become full members of RippleNet have the option to interface with Ripplenet institutions xVia API.

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2 minutes ago, Tako said:

You are right. “Crypto asset” is a much broader definition, but they include CBDCs imho. My logic: just as cash is an asset class in itself, crypto asset can mean any dlt based cryptocurrency, including CBDCs. 

Maybe my understanding of crypto assets is not correct though. Do you have another definition for it, that makes it clear that CBDCs are not included?

Well, you can see there is a difference between a CBDC and a Central Bank issued cryptocurrency. Both a CB issued crypto as a public cryptocurrency are crypto assets, a cbdc is not. 

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2 minutes ago, ZeeperCreeper said:

My understanding is that for these companies that don't have the volume and therefore the need to become full members of RippleNet have the option to interface with Ripplenet institutions xVia API.

Do you know of any cost data for xVia connectivity?  I am curious to understand what the pricing model for xVia looks like.

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5 minutes ago, Paradox said:

Do you know of any cost data for xVia connectivity?  I am curious to understand what the pricing model for xVia looks like.

It should be less costly. Maybe we can just aks all five of the first xVia customers and hopefully get a reply. I have no idea on what the pricing looks like.

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18 minutes ago, Dutch_ins said:

Well, you can see there is a difference between a CBDC and a Central Bank issued cryptocurrency. Both a CB issued crypto as a public cryptocurrency are crypto assets, a cbdc is not. 

Ah, ok, I see now. I’ve never made distinction between cbdcs and cb issued digital currencies, thanks for pointing out the difference. Anyway, in that case CB issued crypto (not cbdc) may be used within target2..

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18 minutes ago, Dutch_ins said:

It should be less costly. Maybe we can just aks all five of the first xVia customers and hopefully get a reply. I have no idea on what the pricing looks like.

Could be.  From a business decision perspective, the decision matrix should be quite clear:

- Quantify current and projected fully-loaded OPEX related to SWIFT costs and supporting operations

- Quantify current and projected number of international payments over a given time period (including both SWIFT and RippleNet, per-transaction cost, if any)

- Quantify RippleNet product (either xVia or xCurrent) and/or Multi-Hop implementation, licensing, and/or per transaction costs over same time period

- Compare costs over desired time period

- Weigh resulting cost savings or increases against knock-on effects from implementation and non-implementation (e.g. firing of employees vs. new product offering)

- Make decision

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19 hours ago, Paradox said:

The difference in this example though is that the “value” you are referring to is the “value” of the bond or promise, not the “value” of a EUR.  I think a more fitting term is “price” or “premium”, as the riskier borrower must pay more for the same Euro.   The “price” of the bond or contract is dependent on the risks of the borrower only in this example, as the underlying value of what is being promised is equal for both a German bond and a Greek bond (1 EUR = 1 EUR).

It isn’t so much 1 EUR isn’t equal to another EUR,  it is more the case that one sovereign borrower of EUR is less capable of paying back the EUR than another sovereign EUR borrower, resulting in a higher “price” paid by the less capable borrower for the same amount of EUR.

Yeah this is correct.  The difference is Time.

A "spot Euro" should be at parity. A future Euro will always have spreads in valuation depending upon several factors, borrower creditworthiness, market interest rates, time of term, payment frequency, etc.

I've made the argument that "Finance" is the study of Time, not money. The math is all about "time value" of money, but you can change out the word money for anything, and use the formula to measure "time value" of anything. I'm pretty sure that it is the same formula used to calculate orbital trajectories. Finance is just calculus applied to economics. 

Economics is all about money/value and humans moving resources around.

 

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6 hours ago, dr_ed said:

Actually I think what you said is pretty profound.

Most of finance is about "time shifting value". 

When you look at most financial services like Insurance, or Stocks, or Bonds, etc... in every case there is a time shifting of value, or an accumulation of value into a specific time period, usually Now.

The fact that "Liquidity" has an inherent Time component to it, is as important as the cryptography of crypto. The problem being solved is a time/liquidity problem. I think of these crypto distributed ledgers are an accounting tool that is uniquely designed to address liquidity risks.

Regarding Einstein and Time, here is a good visual experience of relativity.

zd58c0rmiq031.thumb.jpg.64b08f06510a038acd75c4600e36bfde.jpg

 

Edited by KarmaCoverage

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19 hours ago, KarmaCoverage said:

Most of finance is about "time shifting value". 

Thanks @KarmaCoverage I like your discussion of the time element in finance, indeed, the concept of depreciation acknowledges this very well. Houses, automobiles, factories - many purchases lose value over time. Fiat loses values through the printing of more fiat which emerges as the concept of "inflation". 

Interesting how XRP is beginning to be valued more highly over time, due to the dawning realization that its' usage has barely begun. Almost like a factory being built - with the difference that XRP will not in fact degrade with usage, but will only gain in value over time...

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On 5/28/2019 at 6:09 PM, KarmaCoverage said:

Most of finance is about "time shifting value". 

When you look at most financial services like Insurance, or Stocks, or Bonds, etc... in every case there is a time shifting of value, or an accumulation of value into a specific time period, usually Now.

The fact that "Liquidity" has an inherent Time component to it, is as important as the cryptography of crypto. The problem being solved is a time/liquidity problem. I think of these crypto distributed ledgers are an accounting tool that is uniquely designed to address liquidity risks.

Regarding Einstein and Time, here is a good visual experience of relativity.

zd58c0rmiq031.thumb.jpg.64b08f06510a038acd75c4600e36bfde.jpg

 

Try listening to Bitcoin Ben and samiam at 2X speed. Same thing.

Hunh, hunh, yeah? I'm serious. Well, sorta.....lol.

 

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On 5/29/2019 at 12:18 AM, KarmaCoverage said:

Yeah this is correct.  The difference is Time.

A "spot Euro" should be at parity. A future Euro will always have spreads in valuation depending upon several factors, borrower creditworthiness, market interest rates, time of term, payment frequency, etc.

I've made the argument that "Finance" is the study of Time, not money. The math is all about "time value" of money, but you can change out the word money for anything, and use the formula to measure "time value" of anything. I'm pretty sure that it is the same formula used to calculate orbital trajectories. Finance is just calculus applied to economics. 

Economics is all about money/value and humans moving resources around.

 

Yep. Philosophers will tell us that a shorthand phrase to describe our existence is that ‘being is time’. Money is a subset of that. 

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On 5/28/2019 at 12:19 AM, ADingoAteMyXRP said:

the German bank doesn't need to keep any Euros in the ECB. They simply sell their local onhand Euros for XRP, send it to the Greek bank, and the Greek bank converts it back to Euros.

A Euro is located on the central bank balance sheet (of the national central bank), so the Bundesbank for Germany. The "Euro" that is located in a private bank, such as Deutschbank, is a private liability to pay central bank Euros to another institution which also has an account at the Bundesbank. Debiting and Crediting the accounts at the national central banks, that is, increasing the debt or surplus of a given national central bank towards another national central bank, is TARGET2, and the associated contracts are the TARGET2 balances held on the national central banks' balance sheets, not the ECB. There is no "ECB balance sheet" because all monetary activity in the Euro system takes place within the national central banks (https://www.ecb.europa.eu/pub/annual/balance/html/index.en.html; https://www.ecb.europa.eu/stats/policy_and_exchange_rates/target_balances/html/index.en.html).   

When you say the German private bank "doesn't need to keep Euros in the ECB", the ECB doesn't hold Euros for private banks or national central banks, nor does the ECB engage in clearing activities, all clearing takes place between national central banks directly through TARGET2. 

If a Eurozone private bank wants to "sell Euros for XRP", the entity with the XRP would also need to hold an account at the Bundesbank, or, the entity's bank must have an account at the Bundesbank, and either the XRP-entity would be accepting central bank money in exchange for their XRP, or private bank liabilities plus central bank money are used. In either case, the transaction you are describing is superfluous. If both entities have accounts at the Bundesbank, and the transaction is denominated in Euro, then there is no need to use XRP. Or, more simply, @Paradox is correct. 

 

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