Round 1:
A Last Parting Shot
Fight!!! Well not an actual boxing match, according to a statement released on Fortune, Ripple CEO Brad Garlinghouse depicted a Trump administration throwing a low blow after the bell has rung or putting a wrench in an engine none as crypto. According to Ripple, SEC Chairman Clayton will allegedly file a lawsuit on both Ripple Execs Chris Larsen and Garlinghouse respectively. Back in October, Larsen made statements about an unclear regulatory framework in the U.S. with respect to cryptocurrency and the potential of Ripple moving business headquarters to a more favorable regulatory climate.
They both also expressed optimism that a new Biden administration could be more favorable to the crypto industry. XRP is the digital asset associated with Ripple, in 2015 the company paid a settlement to FinCEN even though there weren’t any laws actually put in place for digital assets(click FinCEN ? for more details). The allegations ranged from; acting as a money services business (MSB), to failing to implement and maintain an adequate anti-money laundering (AML) program designed to protect its products from use by money launderers or terrorist financiers.
The narrative that will surely dominate Ripple’s defense is an emailed statement sent by outside counsel Michael Kellogg of Kellogg, Hansen, Todd, Figel & Frederick. In it, he stated, “This complaint is wrong as a matter of law. Other major branches of the U.S. government, including the Justice Department and the Treasury Department’s FinCen, have already determined that XRP is a currency. Transactions in XRP thus fall outside the scope of the federal securities laws. This is not the first time the SEC has tried to go beyond its statutory authority. The courts have corrected it before and will do so again.”- Coindesk
IN THIS CORNER(click name/link to interact)
KEY INFLUENCERS FOR USG
- President Trump: 07/11/19 Trump Tweets FUD
- USST Mnuchin: 12/23/20 FinCEN proposed document published in Fed Register and available online
- SEC Chairman Clayton: 12/10/19 Clayton testifies before Congress w/ prepared statement on Distributed Technology and Digital Assets (ctrl+f>digital assets
KEY INFLUENCERS FOR RIPPLE
- Executive Chris Larsen: 07/14/20 Larsen has virtual fireside chat w/ WSJ’s(Wall Street Journal)reporter Paul Vigna and shocks the crypto industry
- CEO Brad Garlinghouse: 12/02/20 Garlinghouse interviews w/ CNBC’s Julia Chatterley touching on a DEFI protocol network driving interoperability, bridging the ETH Virtual Machine w/ the XRPL(XRP LEDGER min 22:87)
- CTO David Schwartz: 06/2012 Engineers Jed McCaleb, Artur Britto & Schwartz launch the XRPL. The goal was to create a digital asset that was more sustainable and built distinctly for the payment industry.
FACTS vs FUD(XRP/XRPL)
FACTS:
THE WEIGH-IN (3 FACTS OF XRP/XRPL)
- XRP helps institutions reduce cost and transactional friction. On 07/19/20 Ripple announced a partnership($50M investment) with publicly traded, money transfer giant MoneyGram International Inc.(MGI). Since then, it has clearly driven competitive advantages against a rapidly evolving remittance industry. (see MGI q3 financial report)
- XRP Ledger is an online system for payments, powered by a community without a “central leader”(Decentralized Exchange). Anyone can connect their computer to the peer-to-peer network that manages the ledger. The XRP Ledger is the home of XRP, a digital asset designed to bridge the world's many fiat currencies and crypto-assets. The XRP Ledger is one part of the inevitable Internet of Value. A frequently used phrase by Chris Larsen, it’s a world where money moves the way information does today.
3.There is nothing central about the On-Ledger Decentralized Exchange that thrives on being, a fully-functioning accounting system for tracking and trading obligations denominated in any way users want(Fiat/Crypto), and a decentralized exchange built into the protocol. All this allows the XRPL’s consensus algorithm to settle transactions in 3-5 seconds and can process 1500 transactions in just one!
FUD(FEAR, UNCERTAINTY, and DOUBT)
Controversy Sells Tickets(3 misinterpretations of XRP/XRPL)
- XRP is too volatile for banks, exposing them to exchange rate fluctuations at faster speeds, and in some currencies, the risk is too high for banks to involve themselves period. This is so far off it's a bit sad, but that’s what I’m here for, to expand my readers' knowledge of the biggest innovations since the internet. The fact is, Ripple will use the On-Demand Liquidity (ODL) payment service(All-Time : $Volume1,987,951,631.87) formerly known as xRapid, to process cross-border payments quickly and cost-effectively, settling each transaction within seconds. The ODL feature acts as a bridge currency between two Fiat currencies, eliminating the need for pre-funding Vostro/ Nostro accounts. (see explanation)
- If you invest in XRP you will own a share in Ripple who can manipulate the price anytime they want. Unfortunately, there is no quarterly dividend, this is yet another misunderstanding, buying XRP is unrelated to Ripple in that if they went under and shut down operations, the engineers, developers, validators, and users would still be able to use XRP as if Ripple never existed. XRP’s open-source protocol and decentralized ledger, make it possible for anyone to build on top.
- XRP can be duplicated, but only by Ripple. Boy oh boy, some of the things that still circulate in the XRP community after seven years, makes one think that misinformation would be resolved by now. Ripple CTO(Chief Tech Officer) David Schwartz gave the best explanation for why this is impossible in a thread posted on Quora.
“The software contains no way to create XRP and multiple safeguards to prevent it from doing so accidentally or erroneously. Ripple can’t make XRP users run software they don’t want to run, so even if Ripple made a modified version of the software that had some way to create additional XRP, Ripple can’t make exchanges, wallet providers, and users run that modified software”.
He went on to say “The XRP Ledger provides no mechanism to create additional XRP in an existing ledger instance. At least as we’re currently using the term “XRP”, it refers to ledger balances in the current ledger instance.- QUORA.
My views and opinions are not to be taken as financial advice. Please DYOR(Do-Your-Own-Research) and take time to read project documentation to give yourself the knowledge needed to build a strong portfolio. So there you have it, Round 1 in the books and if you're a rabbit hole invader like me, you’ll probably find yourself stuck
“In This Corner” for a little bit longer than expected!
Thank you for reading & supporting
Octavio Nares
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