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Mr Dilip Rao


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37 minutes ago, RipAndDip said:

Did I misunderstand, or are they no longer pushing that angle?

Swift is only a (very expensive and slow) messaging protocol. Since Swift only transmits messages (somewhat) securely, the funds have to settle via an ancient system called the correspondent banking system (feel free to google it).This combination results in a system where payments fail 8-10% of the time (not a typo) and take 3-5 days to settle. While Ripple can ingest existing  messaging formats (swift for example which was a genius move by Ripple),   Ripple can handle both messaging AND funds settlement. Because of this, Swift could technically run on Ripple. They are not competitors since Ripple is a base layer payments protocol beneath even Swift. The Global Payments Steering Group (GPSG), chaired by Bank of America is a bank owned consortium, like Swift, that is developing uniform rules on how banks will use this technology. GPSG is a direct competitor to Swift, and as Dilip mentioned, they just met with Ripple's Japanese consortium to sign off on the rules. 

Hopefully that's clears things up in your mind.

Lots of good nuggets in this video. Gotta love at the end where he mentions that top banks are looking to eliminate vostro/nostro accounts in lieu of instant liquidity sourced with XRP. 

Edited by Xi195
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1 minute ago, Xi195 said:

While Ripple can ingest existing  messaging formats (swift for example which was a genius move by Ripple),   Ripple can handle both messaging AND finds settlement. Because of this, Swift could technically run on Ripple. They are not competitors since Ripple is a base layer payments protocol beneath even Swift.

That definitely clears things up for me. Thank you for the in-depth explanation.

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2 hours ago, Xi195 said:

Gotta love at the end where he mentions that top banks are looking to eliminate vostro/nostro accounts in lieu of instant liquidity sourced with XRP. 

That being the main point for us as investors . Imagine XRP being used to settle liquidity for millions of transactions . Once real usage starts and all the rules are set and done then i want to see how XRP is impacted .

But i also want to see Ripple work on XRP at the same time . Try to stay a foot in the blockchain market so it can target a larger group of people and hence XRP develops multiple uses. Because the way he speaks , it sounds like he does not care much about XRP :( (Maybe because the target audience in that video).

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8:00 He is talking about Interledger: 

"...it is open, w3c committee behind it, people like U.S. Federal Reserve, Wells Fargo, Google, etc." 

 

According to this (pg 36) the Fed Faster Payments task force is targeting the end of July for releasing their report. Page 19 at the link also has  the following targets:

Recommendation 9 • Deliverable Description: Initial research on crossborder capabilities is published • Proposed Target Date: End of 2018

Recommendation 10 • Deliverable Description: Initial research on emerging technologies is published • Proposed Target Date: End of 2018

 

 

End of 2018 seems like enough time to see how it works out with Japan and the GPSG members before going all in.

 

 

Edited by Kakoyla
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6 minutes ago, RipAndDip said:

If The Fed releases a favorable report, we can expect to see a nice bump.

I would be surprised to see Ripple or XRP mentioned, and people have a hard time connecting the dots. They already have mentioned ILP back in December though :

In addition, a particular industry development of note is the Interledger Protocol (ILP) which allows transactions to flow across different ledgers and creates connection points between two or more digital ledgers. In effect, the protocol defines a set of procedures for proposing a payments path and cryptographically escrowing funds across a series of interoperable ledgers and then subsequently executing the escrowed transactions once the recipient of the payment validates or acknowledges receipt of payment. The ILP is being developed as an open standard and is intended to improve interoperability and streamline the process for transferring digital assets by enabling entities in different countries with different payment systems to more easily transact with one another. Adoption of this or a similar protocol could spur further innovation and adoption of DLT-based systems for the cross-border payments use case.

https://www.federalreserve.gov/econresdata/feds/2016/files/2016095pap.pdf

Edited by Kakoyla
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14 minutes ago, Kakoyla said:

Very interesting paper.

Quote

Open systems are those that accept all interested entities that have the technical ability to participate. Closed systems have additional membership criteria that must be satisfied in order for an entity to be permitted to operate a node. These criteria can include financial requirements such as the entity’s creditworthiness or ability to access liquidity resources, as well as legal requirements such as the entity’s ability to meet any contractual obligations to the arrangement or to have proper business licenses to conduct business. Cryptocurrency DLTs such as Bitcoin are generally open systems. Many DLT arrangements being contemplated by the financial industry, however, are envisioned as closed.

Quote

Cryptocurrency DLT arrangements such as Bitcoin are examples of permissionless systems. The financial industry, however, is focused mainly on developing permissioned systems because these systems offer a way to provide controls over important functions performed in the arrangement.

How does Ripple fit into this? They're obviously a closed system, and even though they'll become decentralized, the nodes will be controlled by trusted members. What about permissions though? Do they provide an additional level of fine-grained control over the actions each node is allowed to perform?

Quote

Numerous firms have identified the slow, indirect, and expensive settlement of cross-border payments as a current point of friction that could be alleviated through the application of DLT arrangements. Currently, electronic cross-border payments are effected by credit (and sometimes debit) transfers that convert funds from bank to bank through a series of correspondent banking relationships, often with an assessment of multiple fees. According to one report, the settlement times for cross-border payments can take up to five days for the most common currency pairings, generally with limited clarity regarding the total amount of fees to be charged and the timing of settlement.

Exactly what Dilip Rao was targeting in his presentation.

Quote

Fundamentally, if broad adoption of DLT is to take place in payments, clearing, and settlement, the industry will need a critical mass of participants for any application of the technology to be successful. Network effects are derived from the fact that each additional user of a network increases the benefit of the network for existing users. This effect can often lead to a problem for early adoption because the net benefits for early adopters may be negative without sufficient participation, leading to a possible lack of adoption.

When does Ripple reach its critical mass of participants? Will the snowball begin rolling on its own with the 75+ banks on board?

 

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He seems to be talking to bankers in India, quite a convincing presentation. He emphasizes that (1) Ripple is really focusing on cross-boarder remittances, and (2) Ripple's products have completed the pilot stage and are waiting for the real use. The video clearly demonstrates that XRP is something that plays a critical role in the real world. If I were a banker, I would say "Why not just use this?".  

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10 hours ago, RipAndDip said:

The FED paper, on cross-border payments, pp. 18-19, says:

"[A] particular industry development of note is the Interledger Protocol (ILP) which allows transactions to flow across different ledgers and creates connection points between two or more digital ledgers. In effect, the protocol defines a set of procedures for proposing a payments path and cryptographically escrowing funds across a series of interoperable ledgers and then subsequently executing the escrowed transactions once the recipient of the payment validates or acknowledges receipt of payment. The ILP is being developed as an open standard and is intended to improve interoperability and streamline the process for transferring digital assets by enabling entities in different countries with different payment systems to more easily transact with one another. Adoption of this or a similar protocol could spur further innovation and adoption of DLT-based systems for the cross-border payments use case."

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4 minutes ago, Alluvial said:

 

The FED paper, on cross-border payments, pp. 18-19, says:

"[A] particular industry development of note is the Interledger Protocol (ILP) which allows transactions to flow across different ledgers and creates connection points between two or more digital ledgers. In effect, the protocol defines a set of procedures for proposing a payments path and cryptographically escrowing funds across a series of interoperable ledgers and then subsequently executing the escrowed transactions once the recipient of the payment validates or acknowledges receipt of payment. The ILP is being developed as an open standard and is intended to improve interoperability and streamline the process for transferring digital assets by enabling entities in different countries with different payment systems to more easily transact with one another. Adoption of this or a similar protocol could spur further innovation and adoption of DLT-based systems for the cross-border payments use case."

wow !!!!

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