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Direct correlation between XRP price and BTC transaction fee's


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@jargoman I'm not sure about whatever gold & silver have to do with anything.

But your idea about XRP's value being tied to the Utility value of a BTC TX fee should have merit while the correlation lasts. XRP is simply faster and cheaper, (lets say 90%) so it would then make sense that XRP be relatively worth 10% of BTC.

The cost of a BTC TX fee would make sense to use as a benchmark value for the value of a Digital Asset TX, obviously ETH would be another benchmark. Then you would want to consider the various types of things that can and cannot be accomplished via each network's/ledger's TX. Do a benchmark adjustment from there and that would be one way to come up with a reasonable valuation.

Edited by KarmaCoverage
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No xrp being 10 times faster doesn't equate to 1 tenth the price. The speed has nothing to do with it. If anything being faster should make it worth more.  The reason there's a correlation is because a high fee is a deterrent for usage. People start using xrp to make transfers instead. The higher the fee, the more incentive to use xrp. Why XRP specifically? Because ethereum's tx fee would be high during times of high payment volume. Btc, xrp and eth are the most liquid and traded against the most pairs. With btc and eth costing more that leaves xrp as the most cost effective solution. More new xrp accounts are created during those times so this suggests people see that btc is too slow and decide to invest in xrp long term. 

The reason gold and silver are relevant is that btc tends to follow the price of gold as a safe haven asset. The price of silver is correlated to the cost savings of using silver as an alternative to gold. There both has to be a demand for high end electronics and the cost of mining or purchasing gold makes it unfeasible.

The coincidental thing we see is that xrp is indirectly influenced by assets you wouldn't expect. Such as oil. When oil increases in value electricity costs increase, which increases the cost of btc and increases the transaction fee which in turn increases the value of xrp

 

Assets aren't valued based on their technical specs. They are valued based on the usefulness for profit. Or cost reducing benefits. Btc's value is tied to its cost reducing property of being resistant to seizure. XRP's value is tied to usefulness for profit. The ability to transfer value quickly and efficiently with high liquidity. 

Based on these premises ripple is spot on with their game plan. Increase liquidity and utility for profit and the price will follow.

I'd also like to add that the guy who said xrp would never increase in value because 1 xrp could be send back and forth over and over again to send a quadrillion dollars is an idiot. Market makers would scalp 1% spread giving xrp a profit potential. Then xrps would be valued by its time value. How much value are you willing to bid to purchase an asset which can earn 1% of a quadrillion dollars.  A price earning ratio of 10 would value xrp at 100 trillion dollars for its circulating coins

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1 hour ago, jargoman said:

Ningún xrp que sea 10 veces más rápido no equivale a una décima parte del precio. La velocidad no tiene nada que ver con eso. Si algo es más rápido debería hacer que valga más. La razón por la que existe una correlación es porque una tarifa alta es un impedimento para el uso. La gente comienza a usar xrp para realizar transferencias. Cuanto más alta sea la tarifa, más incentivo para usar xrp. ¿Por qué XRP específicamente? Porque la tarifa de tx de ethereum sería alta durante tiempos de alto volumen de pago. Btc, xrp y eth son los más líquidos y se negocian contra la mayoría de pares. Dado que btc y eth cuestan más, xrp es la solución más rentable. Se crean más cuentas nuevas xrp durante esos momentos, por lo que esto sugiere que las personas ven que btc es demasiado lento y deciden invertir en xrp a largo plazo. 

La razón por la que el oro y la plata son relevantes es que btc tiende a seguir el precio del oro como un activo de refugio seguro. El precio de la plata se correlaciona con el ahorro de costos de usar la plata como alternativa al oro. Ambos tienen que haber una demanda de productos electrónicos de alta gama y el costo de la extracción o la compra de oro lo hace inviable.

La coincidencia que vemos es que xrp está indirectamente influenciado por activos que no esperaría. Como el aceite. Cuando el petróleo aumenta de valor, los costos de electricidad aumentan, lo que aumenta el costo de btc y aumenta la tarifa de transacción, lo que a su vez aumenta el valor de xrp

 

Los activos no se valoran según sus especificaciones técnicas. Se valoran en función de la utilidad para obtener beneficios. O beneficios de reducción de costos. El valor de Btc está ligado a su propiedad de reducción de costos de ser resistente a la incautación. El valor de XRP está vinculado a la utilidad con fines de lucro. La capacidad de transferir valor de manera rápida y eficiente con alta liquidez. 

Con base en estas premisas, Ripple da en el clavo con su plan de juego. Aumente la liquidez y la utilidad para obtener ganancias y el precio seguirá.

También me gustaría agregar que el tipo que dijo que xrp nunca aumentaría de valor porque 1 xrp podría enviarse una y otra vez para enviar un billón de dólares es un idiota. Los creadores de mercado sacarían un diferencial del 1%, lo que le daría a xrp un potencial de ganancias. Entonces xrps sería valorado por su valor de tiempo. ¿Cuánto valor está dispuesto a ofertar para comprar un activo que puede ganar el 1% de un billón de dólares? Una tasa de ganancia de precio de 10 valoraría xrp en 100 billones de dólares por sus monedas en circulación.

spectacular thought ..... I share it and applaud! thanks.

hug

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On 11/6/2020 at 1:11 PM, jargoman said:

It's been demonstrated that XRP's chart closely mimics that of silver and I've discovered why. Silver is a cheaper alternative to gold's utility. (jewlery, high end electronics, store of value)

Similarly XRP is a cheaper alternative to BTC's utility. BTC's price has closely mimicked that of gold. 

The implications of this chart demonstrates that XRP's price is a reflection of it's utility. It's not a hype cycle but rather a utility cycle. BTC's transaction fee is $12 right now. BTC's transaction fee's spike very rapidly and therefore XRP's price spikes very rapidly. 

XRP hitting $1 in a number of weeks and $4 in a matter of months isn't absurd in the slightest as BTC's transaction fee will likely spike very soon. 

 

  • Jan 2018 - 25,000 sats
  • Jun 2018 - 8,000 sats
  • Jan 2019 - 9,500 sats
  • Jun 2019 - 5,000 sats
  • Jan 2020 - 2,600 sats
  • Jun 2020 - 2,000 sats


Considering XRP is at 1,600 which is lower than April 1 2017 and continues to stagnate or fall regardless of what BTC does, your narrative is a coping mechanism that is not very different that the narrative other projects are shilling.  Example, the Nano community have been shilling the same narrative which says that Nano will rise again when when BTC fees hit highs like it did in January 2018 since Nano is fastest and only feeless alternative to Bitcoin.  But the only thing that has happened is Nano has fallen more every quarter.  Hell, Litcoin the supposed silver to Bitcoin is at the same price as it was in 2013 when Bitcoin was $1,000 and XRP was $0.06.  A ton of alts shilled that Altseason was coming when BTC went above $10K and fees would rise but most of those projects are now zombie projects or have lost massive value against BTC probably never to recover.

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On 11/11/2020 at 8:33 AM, fatlever said:
  •  Hell, Litcoin the supposed silver to Bitcoin is at the same price as it was in 2013 when Bitcoin was $1,000 and XRP was $0.06.  A ton of alts shilled that Altseason was coming when BTC went above $10K and fees would rise but most of those projects are now zombie projects or have lost massive value against BTC probably never to recover.

Just came back here to mention that XRP and Litecoin are among the best performing assets today :dirol:

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On 11/11/2020 at 2:33 PM, fatlever said:
  • Jan 2018 - 25,000 sats
  • Jun 2018 - 8,000 sats
  • Jan 2019 - 9,500 sats
  • Jun 2019 - 5,000 sats
  • Jan 2020 - 2,600 sats
  • Jun 2020 - 2,000 sats


Considering XRP is at 1,600 which is lower than April 1 2017 and continues to stagnate or fall regardless of what BTC does, your narrative is a coping mechanism that is not very different that the narrative other projects are shilling.  Example, the Nano community have been shilling the same narrative which says that Nano will rise again when when BTC fees hit highs like it did in January 2018 since Nano is fastest and only feeless alternative to Bitcoin.  But the only thing that has happened is Nano has fallen more every quarter.  Hell, Litcoin the supposed silver to Bitcoin is at the same price as it was in 2013 when Bitcoin was $1,000 and XRP was $0.06.  A ton of alts shilled that Altseason was coming when BTC went above $10K and fees would rise but most of those projects are now zombie projects or have lost massive value against BTC probably never to recover.

xrp would have risen if it were not for smeone injecting massive quantities into the market. So forget any bull run until these escrows are finished.

Price = trade betw. offer and demand. Offer is throttled such that price is stable. Everytime xrp could go up, some more are released and go into circulation and price stagnates. From Aug to now further 500mlns have been released from escrows.

SO this is the story. By now the only one who profit is Ripple and the few that have those 5 blns xrp from the beginning.

They will be (are already) billionnaires. Then ,starting from maybe the year 2025-2028 maybe xrp will start to go up.

 

In fact there is no wys by noew to see higher highs. The good news is that price held above the last minimum (0,1usd) and is holding above sma20 in the weekly tf. But on the monthly price still cannot cross the same sma20 and remains constrained by that. So when I see price above that line on a closed monthly candle I will begin to hope for the fisrt higher high.

Atm it looks good, but in few days another escrow ledger will be released and price will fall again.

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2 hours ago, JJJ2 said:

xrp would have risen if it were not for smeone injecting massive quantities into the market. So forget any bull run until these escrows are finished.

Ripple do not sell except OTC to their own customers for use in ODL.  And not in market affecting amounts.  Brad reiterated that fact recently in a podcast.  You could hear his understandable frustration at that false belief in his voice.  Whatever the reason for XRP stagnation it is NOT Ripple.

The escrows have nothing to do with this.  It is true however that you and the vast bulk of the market believe they do,  and that in itself might explain part of the problem.

People who follow this incorrect belief seem to forget how well Bitcoin does in spite of a relentless drumbeat of miners selling their rewards.  The argument you make does not stand up to scrutiny.

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5 hours ago, BillyOckham said:

Ripple do not sell except OTC to their own customers for use in ODL.  And not in market affecting amounts.  Brad reiterated that fact recently in a podcast.  You could hear his understandable frustration at that false belief in his voice.  Whatever the reason for XRP stagnation it is NOT Ripple.

The escrows have nothing to do with this.  It is true however that you and the vast bulk of the market believe they do,  and that in itself might explain part of the problem.

People who follow this incorrect belief seem to forget how well Bitcoin does in spite of a relentless drumbeat of miners selling their rewards.  The argument you make does not stand up to scrutiny.

It’s hard for them to grasp, so they roll out the same old crap other and other, sometimes you’ve got to stand back and admit there’s no educating pork 👍

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On 11/7/2020 at 5:47 PM, jargoman said:

No xrp being 10 times faster doesn't equate to 1 tenth the price. The speed has nothing to do with it. If anything being faster should make it worth more.  The reason there's a correlation is because a high fee is a deterrent for usage. People start using xrp to make transfers instead. The higher the fee, the more incentive to use xrp. Why XRP specifically? Because ethereum's tx fee would be high during times of high payment volume. Btc, xrp and eth are the most liquid and traded against the most pairs. With btc and eth costing more that leaves xrp as the most cost effective solution. More new xrp accounts are created during those times so this suggests people see that btc is too slow and decide to invest in xrp long term. 

The reason gold and silver are relevant is that btc tends to follow the price of gold as a safe haven asset. The price of silver is correlated to the cost savings of using silver as an alternative to gold. There both has to be a demand for high end electronics and the cost of mining or purchasing gold makes it unfeasible.

The coincidental thing we see is that xrp is indirectly influenced by assets you wouldn't expect. Such as oil. When oil increases in value electricity costs increase, which increases the cost of btc and increases the transaction fee which in turn increases the value of xrp

 

Assets aren't valued based on their technical specs. They are valued based on the usefulness for profit. Or cost reducing benefits. Btc's value is tied to its cost reducing property of being resistant to seizure. XRP's value is tied to usefulness for profit. The ability to transfer value quickly and efficiently with high liquidity. 

Based on these premises ripple is spot on with their game plan. Increase liquidity and utility for profit and the price will follow.

I'd also like to add that the guy who said xrp would never increase in value because 1 xrp could be send back and forth over and over again to send a quadrillion dollars is an idiot. Market makers would scalp 1% spread giving xrp a profit potential. Then xrps would be valued by its time value. How much value are you willing to bid to purchase an asset which can earn 1% of a quadrillion dollars.  A price earning ratio of 10 would value xrp at 100 trillion dollars for its circulating coins

Excellent analysis. I have used XRP like that many times. Faster tx time also means less exposure to volatility. BTC can move an awful lot while people wait for confirmations. Utility is exactly why I hold mostly XRP in my wallet. 

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