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MGI, ODL, Bitso and a theory about the price

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@Julian_Williams

Funny timing, I just was looking at Bitso's raw hourly XRP->MXN trading volume (see pic below). And from what I've seen, we've suddenly seen a pattern change in the volume for this trade (it actually so surprised me, I went back and looked for any errors in my charting).

Up until just two days ago, the reported metrics were quite random - and for now, it's smoothed out (see below). In fact, you can see the rate bumped up after one day.

LMK if you are curious, I can post a few more charts less granular.

Here is the raw trade volumes on an hourly snapshot for last five days...

 

xrp2mxn-bitso-5d-hourly-06NOV-10NOV2019.png

Edited by JASCoder

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37 minutes ago, JASCoder said:

@Julian_Williams

Funny timing, I just was looking at Bitso's raw hourly XRP->MXN trading volume (see pic below). And from what I've seen, we've suddenly seen a pattern change in the volume for this trade (it actually so surprised me, I went back and looked for any errors in my charting).

Up until just two days ago, the reported metrics were quite random - and for now, it's smoothed out (see below). In fact, you can see the rate bumped up after one day.

LMK if you are curious, I can post a few more charts less granular.

Here is the raw trade volumes on an hourly snapshot for last five days...

 

xrp2mxn-bitso-5d-hourly-06NOV-10NOV2019.png

very interesting - looks random but I am sure there are patterns there?

I think everyone wants to have a better understanding of what the data is telling us.  Galgitron is also very interested in following XRapid fingerprint

there is also this site

https://dex.xrplapps.com/asset.php?ID=XRP

 

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1 hour ago, Julian_Williams said:

very interesting - looks random but I am sure there are patterns there?

I think everyone wants to have a better understanding of what the data is telling us.  Galgitron is also very interested in following XRapid fingerprint

there is also this site

https://dex.xrplapps.com/asset.php?ID=XRP

 

Thanks so much @Julian_Williams for your feedback. You also reminded me that Galgitron had replied to a past tweet of mine on this, I have pinged him just now regarding this intriguing change.

That resource at dex.xrplapps is great, thanks again for that. I hugely have "chart esthetics" envy now, tho!! I'm currently just using a handy freebie WP plugin to do the rendering of the raw data.

I have an idea what might be forming up as general pattern, as these events begin to scale up. Also I'm realizing what other data would be helpful to monitor - specifically the metrics on inbound XRP transfers into Bitso's ledger account (too bad MGI doesn't share their fiat payout history heh).

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13 minutes ago, JASCoder said:

Thanks so much @Julian_Williams for your feedback. You also reminded me that Galgitron had replied to a past tweet of mine on this, I have pinged him just now regarding this intriguing change.

That resource at dex.xrplapps is great, thanks again for that. I hugely have "chart esthetics" envy now, tho!! I'm currently just using a handy freebie WP plugin to do the rendering of the raw data.

I have an idea what might be forming up as general pattern, as these events begin to scale up. Also I'm realizing what other data would be helpful to monitor - specifically the metrics on inbound XRP transfers into Bitso's ledger account (too bad MGI doesn't share their fiat payout history heh).

how you do this data filtering is above my pay grade, but we are all interested!

 

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17 hours ago, Julian_Williams said:

how you do this data filtering is above my pay grade, but we are all interested!

 

( i'm getting dragged away, lol - not all share our passion sadly - i fail to fathom WHY !! )

In brief: I've a daemon on an EC2 AWS instance pulling CryptoCompare's public (free!) feed into a WordPress database, and I run a script to populate a pre-made plug-in (free!) chart. I'm hoping to automate and expose this as a free service live in a few days, I need to add in their credits and stuff, and coordinate with the potential public facing web host.

But I'd love some beta testers if you're volunteering :) we do have a "dev/testing" page up now.

Cheers.

Edited by JASCoder

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So will Ripple have to invest in every currency based country where they open a new corridor in order to get liquidity?

Wasn't BG making a point about how amazed he was they do not actually need to give an incentive to boost ODL locally because independent marketmakers are already out there doing their job?

Edited by CarloPonzi

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11 hours ago, CarloPonzi said:

So will Ripple have to invest in every currency based country where they open a new corridor in order to get liquidity?

Wasn't BG making a point about how amazed he was they do not actually need to give an incentive to boost ODL locally because independent marketmakers are already out there doing their job?

My best guess for your two questions: 1) Maybe some, yes. 2) Yes, I too recall someone from Ripple saying that.

We need a good way to help visualize and explain how a healthy ODL corridor sub-network functions in an ideal self-sustaining fashion. I'm working on a diagram I'd like to post here soon for feedback, which I'm hoping will be helpful for those interested.

At its most simplified level, a functioning system of ODL "value flow," has inputs of fiat-A at hub-1, buying XRP and moving it to hub-2 for conversion to fiat-B which then exits from the system. So you get upwards XRP price pressure at hub-1, and downwards at hub-2. This takes a period of time to re-balance the pricing at the two hubs (generally thru automated arbitration). So the deepness, or thinness of the two hubs' markets is this system's vulnerability, and thusly is why, for example, MGI's rollout at Bitso has been apparently growing at a controlled (metered) rate.

If you think about it, just dumping random quantities of buy/sell orders into a thin market will not result in a healthy and optimized system, but if these buy/sell orders are released in a controlled, or metered manner, it would ideally never swamp the arbitrage rebalancing operations.

This is what I think we're seeing in the raw volume chart I posted (note, this morning it went flatline until just now - see pic below).

 

Screen Shot 2019-11-11 at 11.35.55 AM.png

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That's pretty much the main issue I've been thinking about from the beggining. Ripple targets currency markets where friction is high but are in parallel the same markets that have low liquidity.

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7 hours ago, CarloPonzi said:

That's pretty much the main issue I've been thinking about from the beggining. Ripple targets currency markets where friction is high but are in parallel the same markets that have low liquidity.

We could say it's brilliant to go after the "low hanging fruit," while others might say obvious lol. Once you realize the impact reducing fees and latency to remittance service users, it's a no-brainer this alternative will quickly displace the old high-overhead methods. WU must be shitting bricks heh. SWIFT is next haha.

Re ODL - the one component of the process that still mystifies me, is the means of re-balancing the fiat (in this case, the MXN). If it all was a closed system, at some point, fiat-1 reserves of value needs to replenish the waning reserves of fiat-2. This might be too abstract to follow what I'm trying to say, I need to find the time to write this up...  

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15 minutes ago, JASCoder said:

We could say it's brilliant to go after the "low hanging fruit," while others might say obvious lol. Once you realize the impact reducing fees and latency to remittance service users, it's a no-brainer this alternative will quickly displace the old high-overhead methods. WU must be shitting bricks heh. SWIFT is next haha.

Re ODL - the one component of the process that still mystifies me, is the means of re-balancing the fiat (in this case, the MXN). If it all was a closed system, at some point, fiat-1 reserves of value needs to replenish the waning reserves of fiat-2. This might be too abstract to follow what I'm trying to say, I need to find the time to write this up...  

I wonder if this is what DS was referring to when he spoke of businesses coming into play when they execute their purchase orders for American parts/supplies/goods, and effectively acting like market makers. It sounded to me as if this was an unexpected, and formerly not anticipated means for the rebalancing necessary for smooth operation of the MXN-USD corridor.  Maybe someone else can recall this and enlighten me, as I don't understand a bunch of the mechanics behind how this all works - especially since it's in such an early stage.

 

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9 minutes ago, WuWei said:

I wonder if this is what DS was referring to when he spoke of businesses coming into play when they execute their purchase orders for American parts/supplies/goods, and effectively acting like market makers. It sounded to me as if this was an unexpected, and formerly not anticipated means for the rebalancing necessary for smooth operation of the MXN-USD corridor.  Maybe someone else can recall this and enlighten me, as I don't understand a bunch of the mechanics behind how this all works - especially since it's in such an early stage.

 

I think I recall that, albeit from a different description. They were indicating a multi-directional "value flow" of multiple use cases, all combining to help restore the value reserves at all participating hubs. One example was a three-way diagram, where the surplus of XRP at one hub was acquired and sent to a third hub, which in turn was used and sent to hub-1, thus restoring a general balance. 

 

I just reviewed the last 12 hours of Bitso's trades, and noticed something potentially telling... Last night "they" sold off four hours of roughly even tranches of 800k, the MXN valuations took an obvious hit, then the sells backed off to near zero again.

This seems to indicate the 800k level of XRP sell orders into MXN is too impactful an amount - particularly when we compare this to a few days ago, where the sell orders where much smaller. It's really looking like they are doing live testing of the price resetting behavior of the (assumed) automated arbitrage trades which seek to reset Bitso's pricing.

I just wish I had more time to dig into this, it's so fascinating :)
And most happy to find a few others equally interested in this obscure topic !

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4 hours ago, JASCoder said:

I think I recall that, albeit from a different description. They were indicating a multi-directional "value flow" of multiple use cases, all combining to help restore the value reserves at all participating hubs. One example was a three-way diagram, where the surplus of XRP at one hub was acquired and sent to a third hub, which in turn was used and sent to hub-1, thus restoring a general balance. 

 

I just reviewed the last 12 hours of Bitso's trades, and noticed something potentially telling... Last night "they" sold off four hours of roughly even tranches of 800k, the MXN valuations took an obvious hit, then the sells backed off to near zero again.

This seems to indicate the 800k level of XRP sell orders into MXN is too impactful an amount - particularly when we compare this to a few days ago, where the sell orders where much smaller. It's really looking like they are doing live testing of the price resetting behavior of the (assumed) automated arbitrage trades which seek to reset Bitso's pricing.

I just wish I had more time to dig into this, it's so fascinating :)
And most happy to find a few others equally interested in this obscure topic !

You guys are delving into this at a technical level that I can't follow.  But please keep doing it and posting here, just translate to English now and again :)

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58 minutes ago, Molten said:

You guys are delving into this at a technical level that I can't follow.  But please keep doing it and posting here, just translate to English now and again :)

Thanks for the encouragement :)

I can appreciate not all are intrigued by the underlying tech and challenges of effecting a global transformation of the present monetary handling systems. Some just wanna know whenmoon already.
I perceive that many here are generally interested. 

Jargon to plain speak summation:

  • Deploying ODL is a chicken-and-egg conundrum - here is an analogy :
    Imagine there was no cars and trucks, and of course no fuel stations. People want to build cars, but no one wanted to buy them because there was no fuel available. People want to refine fuel, and run gas stations, but there are no customers with cars.
    What do you do ? Who goes first ?
  • In the US, we want to send XRP to Mexico, and sell it there for pesos. But if we try to trade too much XRP in Mexico too often, it would cause the local price to drop so low, as to be prohibitive.
    We need moar buyers with MXN to buy our XRP gaddamnit !
  • There is profit to be made buying XRP cheaper in Mexico and selling it somewhere else at a better price.
    This is where the solution lies... And what us data miners and chart watchers are desperately seeking.

We can't expect all the companies involved to tell us what they are doing to make this work. But there are publicly exposed clues we can monitor and figure out what they're up to, and how close they are to getting their solutions ramped up and growing.

That growth rate, and adoption rate by others, is what will lead to the inflection point at which increasing demand for using more and more XRP begins to impact its price.

That moment, will be transformative.
That moment will be the turning point of price driven not just by speculation.
Our precious hoards of tokens will be lent out to "market makers" to us it to make profit, and pay us "rent" aka interest.

I'm old enuf to remember "Savings Accounts" which paid 6-8% interest to use my hard earned money.
This is found in a normal economy.
That which crypto will return us to.
Hopefully soon !

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31 minutes ago, JASCoder said:

Thanks for the encouragement :)

I can appreciate not all are intrigued by the underlying tech and challenges of effecting a global transformation of the present monetary handling systems. Some just wanna know whenmoon already.
I perceive that many here are generally interested. 

Jargon to plain speak summation:

  • Deploying ODL is a chicken-and-egg conundrum - here is an analogy :
    Imagine there was no cars and trucks, and of course no fuel stations. People want to build cars, but no one wanted to buy them because there was no fuel available. People want to refine fuel, and run gas stations, but there are no customers with cars.
    What do you do ? Who goes first ?
  • In the US, we want to send XRP to Mexico, and sell it there for pesos. But if we try to trade too much XRP in Mexico too often, it would cause the local price to drop so low, as to be prohibitive.
    We need moar buyers with MXN to buy our XRP gaddamnit !
  • There is profit to be made buying XRP cheaper in Mexico and selling it somewhere else at a better price.
    This is where the solution lies... And what us data miners and chart watchers are desperately seeking.

We can't expect all the companies involved to tell us what they are doing to make this work. But there are publicly exposed clues we can monitor and figure out what they're up to, and how close they are to getting their solutions ramped up and growing.

That growth rate, and adoption rate by others, is what will lead to the inflection point at which increasing demand for using more and more XRP begins to impact its price.

That moment, will be transformative.
That moment will be the turning point of price driven not just by speculation.
Our precious hoards of tokens will be lent out to "market makers" to us it to make profit, and pay us "rent" aka interest.

I'm old enuf to remember "Savings Accounts" which paid 6-8% interest to use my hard earned money.
This is found in a normal economy.
That which crypto will return us to.
Hopefully soon !

"We can't expect all the companies involved to tell us what they are doing to make this work. But there are publicly exposed clues we can monitor and figure out what they're up to, and how close they are to getting their solutions ramped up and growing."

Have you guys  exposed some of the clues at SWELL? If so, how close do you think they are to ramping up?

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