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xerxesramesepolybius

IPO Trading Opportunities

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Ostensibly share price would build in Ripple’s ownership of XRP so by purchasing Ripple shares you would also be buying a portion of their XRP (although illiquidly at net present value and not at market price).

The converse is not true though — shares of XRP are not ownership of Ripple.

I’m actually curious how markets price that in, if at all after the IPO. We know the internal share price assumes like 1/10th of current going market value for their XRP since it’s illiquid.

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I’m sure their intention is to pay ripple shareholders some sort of dividends in XRP like SBI intends to do.  Of course our draconian legislators will need to pass some regulations for this to be feasible.  

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Posted (edited)
On 3/3/2020 at 10:33 PM, Ripple-n-Time said:

 Sort of dividends in XRP like SBI intends to do. 

Do you have a source for this?

On 3/3/2020 at 5:39 PM, xerxesramesepolybius said:

What trading opportunities particularly arbitrage plays do you think there would be between listed Ripple shares (post-IPO) and XRP?

There will be imbalances between the value of XRP on Ripple's balance sheet and the market value of Ripple Inc's equity.

@ADingoAteMyXRP makes an interesting point about the utility value of Ripple's XRP being "locked up", and that fact potentially negatively affecting the Present Value of their XRP.

It is a very valid point, but just to play devil's advocate... there is no way Ripple could possibly consume all of that XRP Utility Value in a single present moment.

With that in mind, you would want look towards the Future Value of XRP's Utility Value, then discount that back to a Present Value at what ever Discount Interest Rate you feel is appropriate, given the level of risk you perceive. 

Then divide by share count and you would have a "per share XRP value". 

So Arbitrage? If you can gather enough data and sort of backwards calculate the Discount Rate that the market has priced in.

If your Opinion of the market's Discount Rate is lower, than that rate which the market has "priced in"... buy Ripple stock

Edited by KarmaCoverage

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3 hours ago, KarmaCoverage said:

If your Opinion of the market's Discount Rate is lower, than that rate which the market has "priced in"... buy Ripple stock

That's why I'm planning on buying Ripple stock -- not just because of the inherent company value, but I think their assets are going to be grossly undervalued by analyst calculations. It would be a more longterm play than buying XRP outright, but hey... value investing!

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1 hour ago, ADingoAteMyXRP said:

That's why I'm planning on buying Ripple stock -- not just because of the inherent company value, but I think their assets are going to be grossly undervalued by analyst calculations. It would be a more longterm play than buying XRP outright, but hey... value investing!

Tempting, though I wonder what your thoughts are in terms of ROI on Ripple stock versus holding the underlaying asset XRP?

I find it slightly bizarre those “diversifying” in Ripple stock, XRP and MGI stocks. To me, their fates are all intrinsically linked. 

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8 hours ago, XRP-JAG said:

Tempting, though I wonder what your thoughts are in terms of ROI on Ripple stock versus holding the underlaying asset XRP?

I find it slightly bizarre those “diversifying” in Ripple stock, XRP and MGI stocks. To me, their fates are all intrinsically linked. 

They're partly linked. But Ripplenet could be used and XRP could not lift off and another asset used or no ODL at all.

 

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3 hours ago, SquaryBone said:

They're partly linked. But Ripplenet could be used and XRP could not lift off and another asset used or no ODL at all.

 

But why would Ripple use another asset if it’s got a lot of XRP?  That wouldn’t be smart unless there wasn’t much liquidity in XRP,   but these days it’s everywhere and getting more liquid.

As for no use of ODL I can’t see that happening if regulators get their act together.  Once that problem is solved Ripplenet members would surely like to free up the expensive funds they have to keep overseas.  Ripple predicts an additional saving of 30% beyond the ordinary Ripplenet savings.  Seems unlikely no one would want to use it.

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7 minutes ago, Dogowner5 said:

But why would Ripple use another asset if it’s got a lot of XRP?  That wouldn’t be smart unless there wasn’t much liquidity in XRP,   but these days it’s everywhere and getting more liquid.

As for no use of ODL I can’t see that happening if regulators get their act together.  Once that problem is solved Ripplenet members would surely like to free up the expensive funds they have to keep overseas.  Ripple predicts an additional saving of 30% beyond the ordinary Ripplenet savings.  Seems unlikely no one would want to use it.

I'm not saying this is likely. For me having MGI/Ripple and XRP are indeed betting partly on the same horse. MGI might still have other investments, ... that might bring them value in the future though. Not everything revolves around Ripple and XRP. Note that BTC is still more liquid than XRP so we can hope what we want but things can turn out differently. I doubt MGI bets all on the same horse, same for SBI, ...

I doubt the 30% savings is true at the moment. Why would you need to incentivize MGI if they could just save 30% on costs? When it's at full scale this could very well be, but it's far from that. I see the MXN corridor go down again significantly instead of going up so this might still take a very long time. Maybe more than most can stomach.

I have followed all media, ... on XRP and Ripple, SBI, MGI, IMF, BIS, ... so I'm aware of what Ripple promises and what lives in the market.

Only investing in MGI, Ripple and XRP is a bad strategy. Just like putting all investment in stocks, the same industry, bonds, ... 

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1 hour ago, SquaryBone said:

I'm not saying this is likely. For me having MGI/Ripple and XRP are indeed betting partly on the same horse. MGI might still have other investments, ... that might bring them value in the future though. Not everything revolves around Ripple and XRP. Note that BTC is still more liquid than XRP so we can hope what we want but things can turn out differently. I doubt MGI bets all on the same horse, same for SBI, ...

I doubt the 30% savings is true at the moment. Why would you need to incentivize MGI if they could just save 30% on costs? When it's at full scale this could very well be, but it's far from that. I see the MXN corridor go down again significantly instead of going up so this might still take a very long time. Maybe more than most can stomach.

I have followed all media, ... on XRP and Ripple, SBI, MGI, IMF, BIS, ... so I'm aware of what Ripple promises and what lives in the market.

Only investing in MGI, Ripple and XRP is a bad strategy. Just like putting all investment in stocks, the same industry, bonds, ... 

You would certainly hate my strategy which is to be 100% XRP....and yes a more diverse portfolio would have seen me making profits instead of being 40% in the red.  But I won't change because I think XRP is a certain long term bet.

I think the coming IPO will bring a lot of publicity to Ripplenet and XRP, and be followed by new sorts of investors we need coming into the market. Crypto price is determined by greed, whales and manipulation in an unregulated market.   The beneficial and positive publicity of an IPO will feed into the price of XRP and help free us from the strange behaviour in the BTC dominated crypto world. 

Reading the Flash FX AMA we can see that whilst ramping up ODL they hit snags which are fixed.  We hit an ATH on 20 Feb which was followed by some snag, that snag seems to have been overcome and we had a good day yesterday, and today looks quite promising.  @JASCoder has the best handle on the data for ODL.

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3 hours ago, Julian_Williams said:

You would certainly hate my strategy which is to be 100% XRP....and yes a more diverse portfolio would have seen me making profits instead of being 40% in the red.  But I won't change because I think XRP is a certain long term bet.

I think the coming IPO will bring a lot of publicity to Ripplenet and XRP, and be followed by new sorts of investors we need coming into the market. Crypto price is determined by greed, whales and manipulation in an unregulated market.   The beneficial and positive publicity of an IPO will feed into the price of XRP and help free us from the strange behaviour in the BTC dominated crypto world. 

Reading the Flash FX AMA we can see that whilst ramping up ODL they hit snags which are fixed.  We hit an ATH on 20 Feb which was followed by some snag, that snag seems to have been overcome and we had a good day yesterday, and today looks quite promising.  @JASCoder has the best handle on the data for ODL.

I don't hate your strategy :) to each his own. I'd certainly not recommend it. You either go to the moon and can tell everyone how you knew all along or you go broke ;)

The speed with which the corridors are building will still take a long time to get to a decent volume. I'm not claiming Ripple is not doing whatever they can to get the ball rolling and to get there as quickly as possible.

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19 hours ago, SquaryBone said:

I doubt the 30% savings is true at the moment. Why would you need to incentivize MGI if they could just save 30% on costs? When it's at full scale this could very well be, but it's far from that. I see the MXN corridor go down again significantly instead of going up so this might still take a very long time. Maybe more than most can stomach.

 

To illustrate what I said about the MXN corridor, see the screenshot. The other corridors seems to be at ATH levels again, however the 5 million downwards trend in MXN completely wipes out what the other corridors are making up. Looking forward to continuous monthly doubling :)

image.png

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