Jump to content

What if Ripple minted the entire XRP escrow into Flare FXRP?


Recommended Posts

I've been trying to think how the Flare system might be gamed, and this thought came up after listening to the latest Mickey B Fresh YT piece.

NB: Ripple will not get FLR from the airdrop.

What incentive would Ripple have to mint FXRP with the 1 billion XRP per month released from escrow? They could lose 5% XRP to the agent in fees (though no doubt they could set themselves up as an agent). In return they would gain a large amount of FLR from the inflation rewards pool. They would force the agent(s) to buy lots of FLR (2.5x the value of the XRP) to back the FXRP, which might increase the price of FLR enough to compensate them for the 5% fee. They would gain FTSO votes, but no direct rewards from that, unless the signal provider compensated them. They would probably get a lot of influence over the direction of development of smart contracts on Flare, and in other ecosystems built on top of it. They could easily create their own stablecoin for transfer back to the XRPL.

Any other benefits I've missed? Any drawbacks?

Would such a strategy even allow Ripple to eventually amass so many FLR that they come to dominate the network? Unlikely, is my hunch.

Link to post
Share on other sites
4 hours ago, tulo said:

Any pointer to this number I see continuously? I've never read this anywhere. Thanks.

Yeah I heard this too, but I think it was one of these YouTubers who pretend to know everything and then put out misinfo. I don't think it's that high – surely it can't be right?! 

Link to post
Share on other sites
13 minutes ago, brianwalden said:

@tulo and @thinlyspread 5% is the example they use in their papers. I don't know that it will be the actual rate. If you do a search for "5%" here there's a couple of examples: https://flare.ghost.io/fxrp-walkthru/

 

I dont think that 5% is a realistic spread. Likley just used for a simple example.

Most of the beta examples for Flare Finance (I'm not double checking this, just memory) are more like 0.001% - 0.003%

Edited by KarmaCoverage
Link to post
Share on other sites

Yeah a lot of the details are missing from the Flare Network papers. We get the basic concept, but not how it will exactly work. And if you read through them, things have changed a lot since the beginning, this is still being fleshed out.

I hope I can take part in the FF public beta and I hope FN has a public beta too.

Link to post
Share on other sites
1 hour ago, brianwalden said:

Yeah a lot of the details are missing from the Flare Network papers. We get the basic concept, but not how it will exactly work. And if you read through them, things have changed a lot since the beginning, this is still being fleshed out.

I hope I can take part in the FF public beta and I hope FN has a public beta too.

In all the papers there are the details, but the correct/final numbers are not there. They are left as parameter. I believe 5% is only as an easy example. For sure easier than 0.15%.

Link to post
Share on other sites
On 2/13/2021 at 11:54 AM, PunishmentOfLuxury said:

Any other benefits I've missed? Any drawbacks?

A big drawback is having Ripple as a very big fish in the pond. For all the talk of the XRPL being independent, Ripple is still the biggest fish in the pond by a long way and all the other fish have to keep an eye on it. I don't want Flare to become the same.  I think it was very smart for Flare to cut Ripple out of the network as much as they could. One of the things that makes me bullish on Flare is that it is NOT reliant on Ripple or XRP, and that will become more true as time goes by.

Do I want a significant chunk of the Flare network to be in the hands of Brad "I'm long XRP (sell! sell! sell!)" Garlinghouse? No. Stay away. You've got enough money. Keep your hands off.

Edited by Seoulite
Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.