In the early days, and even through the financial chaos of the last two years, the participants in the crypto market have been quite tribal in nature, competing for investment dollars and vying for attention. It was a side-effect of both protectionist activities for some that invested in the early days, and advocacy activities for others that wanted the market to pay attention to newer technology.
The reason this tribalism developed, and some of the unfortunate things that go along with it, is really inconsequential at this point. History buffs and social scientists may eventually study what happened from 2017 through 2018, but we are at a point now in December where it's important for the entire cryptomarket to determine its next steps.
Don't let the title of this blog fool you: the competition will continue.
In fact, I will be a part of that competition, but for now, I'm setting aside my natural inclination to highlight what I want, and will instead point out that it's important for each of the crypto communities to come together on a specific set of goals for the entire market. I won't delay revealing what these are, as I believe they are absolutely important for all of us to agree on, and they transcend specific crypto-assets:
- We need regulatory certainty (a clear taxonomy)
- We need to make it okay for banks to own, use, and invest in digital assets
- We need to integrate crypto trading with regulated financial markets
- We need interoperability
These four points are how the crypto market moves forward into a new era.
If each of these points are achieved by the larger crypto market, then we as individual investors will reap the rewards at a scale that we've never seen. To continue to attract new investment and move the entire industry forward, this common ground must be something that all of the crypto organizations come together and agree on; it's time for the industry to mature, and we in the XRP Community can do our part to support it.
Ripple has already telegraphed their support of these principles, and now we're seeing them partner with unlikely allies recently to bring about some of these changes. It's proof positive that the leadership in their organization 'gets it' and is actively supporting these points. The XRP Community prides itself on containing visionaries, rational thinkers, and clever developers and entrepreneurs. We can also "be the change we wish to see," as 2019 draws near.
A little over two months ago, it was announced that Ripple and several of its XRP ecosystem co-tenants had formed an organization to lobby the US Congress for legislative consideration of blockchain technology. The organization was named "Securing America’s Internet of Value Coalition," and the lobbying firm hired to represent the organization was the Klein/Johnson Group. 1
The latest news is that Ripple is expanding these sorts of efforts to Europe as well, but is taking a more collaborative approach with another cryptographic network, NEM. 2 The two organizations announced the effort on December 4th, with the following comment from Dan Morgan, Ripple's head of Regulatory Relations:
“Ripple is delighted to be a founding member of Blockchain for Europe. This is a critical time for policymakers in Europe as they seek to develop the right regulatory framework to capture the benefits of both digital assets and blockchain technology.”
The organization is attempting to dispense with aiming legislation at any one particular network, and is instead promoting a more comprehensive understanding of the underlying technology. NEM co-founder Kristof Van de Reck added:
“There is a lack of unbiased information especially when it comes to the open and decentralized application of the technology. We aim to provide insights which are not tailored to the agenda of specific organizations or stakeholders.”
I like that sentiment, and I think it's a progressive way to approach the topic, without aiming any sort of measures at one network. That being said, the article went on to note that permissioned blockchains will probably have an easier time conforming to the consumer requirements of Europe's new General Data Protection Regulation (GDPR). I have a feeling that the organization of this lobbying effort is sorely needed, and will probably be leveraged by multiple countries looking to understand the high-level commonalities and differences between cryptographic networks.
Corda adds XRP Support
Corda, for those that don't know it, is the name of the application developed by R3, the group that has sold its software to numerous banks; it offers a way for those banks that join to conduct messaging with each other in replacement of aging SWIFT architecture. It operates via a permissioned blockchain. 3
They are not direct head-to-head competitors with Ripple, in my opinion, because Ripple's solutions emphasize interoperability with all ledgers that could potentially support the Interledger Protocol, whereas Corda seems to be an application where banks are required to use a specific ledger.
Regardless of the differences between the two, R3 recently announced that one of their new products, the "Corda Settler," will support XRP as its first settlement mechanism: 4
The press release indicated that the Corda Settler will support the settlement of any payment obligation arising on the Corda network. The Settler will verify that the recipient's account was credited and then update the Corda ledger. Gendal Brown, the CTO of R3, provided the following quote as part of the press release:
“The deployment of the Corda Settler and its support for XRP as the first settlement mechanism is an important step in showing how the powerful ecosystems cultivated by two of the world’s most influential crypto and blockchain communities can work together.
While the Settler will be open to all forms of crypto and traditional assets, this demonstration with XRP is the next logical step in showing how widespread acceptance and use of digital assets to transfer value and make payments can be achieved.”
I thought it was amusing how he tried to elevate R3 by comparing it to Ripple; it's like an engine manufacturer comparing itself to Tesla Motors.
That being said, it's a great statement that emphasizes interoperability with other networks, and I think it's a great step that the R3 team has integrated with crypto-assets; banks can now use XRP for settlement if necessary, paving the way for smart contracts and other uses on the Corda platform. It was a great win for XRP generally.
Implications for XRP Supply
In 2017, a number of high-profile lawsuits arose around a deal that R3 and Ripple had made, where up to five billion XRP was in limbo.
The court cases were settled suddenly, accompanied by a dramatic series of announcements through the crypto and mainstream news media on September 12th. 5
However, under terms of the settlement, the resolution of the dispute was sealed, prompting curiosity about the disposition of those five billion XRP. I directly asked for any public information about the resolution of the conflict, and assumed that Ripple would communicate at some point if XRP was involved.
However, the silence on the matter was - and is - deafening.
This concerned me, and I have to assume that, in fact, some XRP remained with R3. I honestly can't see the team willingly creating a tool such as the "Corda Settler" with support for XRP unless it was clearly in their own best interest to do so. And what would make it 'clearly in their own best interest' other than a material stake in the cryptocurrency itself?
Nobody outside of R3 or Ripple knows for certain; and the movement of XRP from wallet-to-wallet doesn't seem to indicate a change in custody. But I'm assuming that R3 has been incentivized somehow through the resolution of the lawsuit.
In any case, I operate by looking at different scenarios; and all of those scenarios point to R3 acting as an active partner with Ripple to promote usage of XRP as a means of settlement, which, no matter the outcome of a lawsuit or two, is fantastic news for those of us that own XRP.
BEFAST TV Panel Discussion
On December 3rd, Ripple's Chief Market Strategist, Cory Johnson, participated in a panel interview titled "Where is Decentralization Going in 2019?" It was hosted by BEFAST TV in San Francisco from 6 pm to 8 pm, and included Cory Johnson, Edith Yeung, a Partner at 500 Startups, and Larry Kane, from Orrick. Orrick is a law firm specializing in technology. 6 7
The facilitator was Mark Friedler, from Cigex:
The panel discussion contained a wide variety of topics and commentary, and Cory Johnson was able to highlight some of his insights for various topics. Here's a few of my favorite points:
Question (Mark Friedler): What have you seen over the course of the year (2018)?
Answer (Cory Johnson): "... with the company, we're doing better than ever before. One of my goals is to help increase the sales pipeline, and give some better awareness towards our own customers. We've seen the sales cycle go from 'a new customer every six weeks' to 'two new customers a week.' We've got over one hundred-and-fifty banks and financial institutions up and live and using Ripple's products on the software side...
... there's a real understanding in the world of business writ large, that there's usefulness - potential usefulness - for blockchain... and just below half of the people ... in the real world of business ... look to blockchain to solve certain business problems. And I think that's another thing that will create fundamental value for crypto-assets."
When Mark Friedler brought up 'other verticals' as a label for some use cases that happen to be non-payment use cases, Cory Johnson had a number of comments, including:
"We have an initiative called Xpring to help other companies developing on XRP. We probably know more about using XRP than anyone else out there ... so we're trying to help them in some cases .. and those are areas that we're looking at; Xpring is making those investments ...
... Xpring is trying to help the XRP ecosystem. What we have is expertise ... It's in our best interest to see XRP succeed as a technology. We own a lot of it. A lot of other people own a lot of it ... (Xpring) is fully dedicated to the XRP ecosystem."
Later on, the conversation turned to matters of decentralization, and the panel generally agreed that the mining pools involved in proof-of-work have gamed the system into a state of centralization, whereas, Cory Johnson emphasized, the XRP Ledger was designed and continues to trend towards greater levels of decentralization.
"If Ripple goes out of business, it will be a really sad day for the Johnson family. But it won't make a damn bit of difference if XRP technology continues to exist, and continues to have all the companies that are continued to be engaged developing on it. It will continue to have lots of places trading it."
It was a dramatic statement that Cory Johnson made with his usual intuitive flair; Larry Kane from Orrick also provided his own take on how his company advises projects looking to build on specific networks. Mark Friedler pointed a blunt question at Larry as well, asking about some start-ups' decision to issue tokens on the Ethereum blockchain in hopes of a future 'moon event' once their networks were built:
Answer (Larry Kane): "Looking back at what happened here was very similar (to the dot com bust), where people thought there was easy money. 'Well I can raise money without giving out equity. All I've got to do is an ERC-20; do a white-paper;' and people were then flipping that - the pumpers and dumpers - and I think it's good that the market's been closed. It's good for the long-term."
Larry Kane represents some of the companies building on blockchain technology, and did not slam the door on ICO fundraising, however, noting that utility coins have a future, essentially echoing what Brad Garlinghouse has been saying about the importance of 'use cases' for digital assets.
The discussion served as a deep dive into decentralization - and other - topics, but more so was a great retrospective on the previous year. At the end of the session, the Q&A covered some open questions from the audience, and included questions about prices, and some specifics about xRapid and xCurrent. The participants were insiders in the blockchain space, and provided a lens to view the coming year as well. I recommend it to XRP fans and anybody following blockchain technology.
Amex Talks about Test with Ripple Tech
The International Air Transport Association (IATA) is the trade association for the world’s airlines, representing some 290 airlines or 82% of total air traffic. 8 On December 3rd, the organization released a video where they focused in on payments technology and trends, hosting Carlos Carriedo, the General Manager for Amex Corporate Payments. Juan Ivan Martín, the Head of Innovation at IATA, facilitated the interview:
Here is the main quote - found at roughly the 7:45 mark in the video - that pertains to Amex's test with Ripple tech:
"We did a pilot. We did a test, partnering with Santander locally, and with Ripple to just do cross-border transactions. Cross-border transactions continue to be complex and slow.
In a matter of seconds, through this test, our clients were able to transfer funds in a very transparent and seamless way, from one part of the world, to the other ...
... it's very promising. (blockchain technology)"
I was very impressed by Juan Ivan Martín as the facilitator, as he followed up this comment with a frank question, noting that American Express is one of the benefactors of the current, broken correspondence banking system, and whether Amex was really just preparing itself to be a 'fast follower' in blockchain technology.
Carlos Carriedo replied by indicating that Amex planned on being a leader in selective areas, and spent some time detailing how Amex is partnering with multiple new fintechs, both in the US and the UK. It was a safe answer, and I think Juan Ivan Martín was correct in his characterization of Amex's approach as a 'fast follower' strategy; it seems like a smart move for Amex, which still does a substantial amount of business through the traditional, legacy banking system.
Regardless of Amex's overall business strategy, it's a smart decision for them to partner with Ripple and explore the technology, especially since hundreds of global banks have already opted to join RippleNet.
Solstice is the name of a company owned by an XRP Community member that decided to branch out into Interledger services, Codius smart contract hosting, and other XRP ecosystem services. They've named their platform "Phobos," which brings to mind a planetary naming convention. 9
On December 3rd, Solstice sent the following tweet:
It was a reminder of how ILP's goal is to connect all ledgers together in an effort to seamlessly move value no matter the mode of settlement.
Both the Codius platform and the Interledger Protocol (ILP) are maintained by Coil team members, and Coil recently worked with Kava to create some additional capabilities for scaling and modularizing Interledger connectors. 10 It's great to see the creations from Kava lab used so quickly after their release.
In a recent blog, I shared how one XRP fan was able to integrate the XRP Tip Bot with Alexa, the Amazon far-field voice recognition and artificial intelligence software. The innovation sparked some excitement across the cryptoverse, and showed how the XRP Tip Bot could be successfully integrated in a new and fun way with Amazon's Echo.
Almost as a follow-up to that innovation was a tweet from @xRpTo_O (Twitter handle), who managed to create a way to tip from Apple's mirror product, Siri:
He included a link to download a 'short-cut' which will integrate with those that have an IOS-based application like an iPhone.
The convenience of the XRP Tip Bot is legendary, and having one additional pathway to use voice recognition on an iPhone is a great addition; @xRpTo_O also included a video with his tweet that shows how the voice command can even integrate with the look-up mechanism within the XRP Tip Bot, to make it easy to find a specific XRP Tip Bot user.
Kudos to @xRpTo_O on the completion of his project, and I hope that this new feature opens the door to a new batch of iPhone users who will access and use the XRP Tip Bot in a cool, hands-free fashion.
Bibox is a massive crypto exchange that supports over two hundred trading pairs. It has quickly climbed the exchange rankings and currently occupies the seventh spot on Coinmarketcap with roughly $287 million in daily volume. 11
What's notable about Bibox is that it's one of those rare success stories when it comes to ICOs. Its ICO occurred in late 2017, during the crypto gold rush of new investment, and the funds were used to build what was called at the time: 12
"an AI enhanced-encrypted digital asset exchange platform."
The site was built by a team headquartered in China as well, and included team members associated with both HuoBi and OKCoin, two other giant Asian exchanges.
They accompanied the announcement with a promotional drawing to motivate current XRP traders to try out their platform, which is a common tactic among exchanges looking to quickly ramp up volume.
I'm honestly intrigued by the rise of some of these ICO-funded exchanges; the Bibox team was comprised of other knowledgeable exchange operators and developers, it seems, so I think the ingredients were there for success regardless of the funding mechanism. It seems that the ICO-funded exchanges are starting to add significant volume to the market over time.
One of the members of the XRP 'Recommended' Unique Node List (UNL) contacted me recently to comment about their addition to the list. It's an honor reserved for those operators that have demonstrated a commitment to consistent up-time and reliability on the network, as well as other pertinent statistics. Ripple is the current maintainer of the list via their commit access to the XRP validator repository, however, they've stated that one of their goals is to support multiple 'default' validator lists in the future.
For now, the list includes nineteen non-Ripple validators (out of a total of 26), meaning that Ripple's contribution to the default validator list is approximately 27%. 14
One of those community validators that is helping to contribute to this high level of increasing decentralization is Alloy Networks. They were announced as part of the most recent addition to the default UNL on November 27th:
The owner of Alloy Networks contacted me via private message on XRP Chat, and had some comments about their listing, along with their perspective for why they felt motivated to contribute:
"It is important for validators to remember that this is not a remunerative endeavor in itself - an expense, if done properly. It could, however, be so indirectly - since high up-times and commitment to a project, are something that clients look to, and here it is publicly visible. To future validators, I'd say if you believe in this entire story unfolding before us, don't be shy of investing in the best infrastructure you can afford, and sometimes even stretch your budget. The ecosystem deserves it, and what more reward than being part of what could possibly become a standard ...
... I think this could have a tremendous impact on small businesses everywhere, within the remaining span of my career. For example, even a small bill sent to an international client may not be payable by credit card. For sheer accounting reasons, systems and fiefdoms. So, we either have to turn the business away, or take a ridiculous hit on the actual money received."
It served to demonstrate how some small business owners that have been adversely impacted by the high fees of the current correspondence banking network have cheered on the innovations that Ripple represents, and it merges perfectly with some of the comments Ripple executives have made about how 'small-and-medium-size-enterprises' (SMEs) stand to benefit the most from these improvements and low fees.
Alloy Network's owner seemed to possess a humble commitment to the ecosystem that was very inspirational for me; I hope that others thinking about contributing to the validator community consider his words of advice and encouragement.
XRP Community API
The developer behind the site contacted me recently on Twitter, and let me know that he actively maintains the site. It was good timing, as he had just added new integration for querying specific data from several exchanges:
The new features will allow developers to call the API for real-time data from the listed exchanges, including Poloniex, SistemKoin, and Bitrue. The API allows users to query by pairing, including sixteen pairings alone from Bitrue, which uses XRP as one of its base currencies.
It's great to see the XRP Community API make valuable data available to the public via the API; potentially any developer can now build an application that runs using data from the Community API.
Acknowledge the Common Ground
It's critical that the members of each cryptographic network group set aside the negative aspects of our (historical) competition and come together to agree on points that will move the entire industry forward.
Each of us that is invested in specific cryptocurrencies has a tendency to fall prey to these motivations of protectionism, competition, and vitriol; but it doesn't need to be that way.
Competition can exist in a world where we also acknowledge common ground.
We (the larger 'we' of the entire cryptomarket) can agree that the industry needs to find legitimacy past its crypto-anarchist roots, and achieve acceptance by the world. Crypto-assets represent a very significant democratization of finance that has never been seen before in the history of money; only now are some prize-winning economists and thinkers grasping its implications.
To achieve the next stage of adoption, all market participants need to support behaviors that encourage innovation of technology that will help the entire market leap ahead, as well as actively support regulatory evolution in each country where traditional finance has so far not embraced crypto-assets.
The size of the cryptomarket will eventually be measured in the trillions. To get there, we need to find the common ground where we collectively nod our heads in unison, and agree that the world needs to see us for what we are; harbingers of the new economy where crypto-assets are part-and-parcel of everyday life.
Sources and Credits:
Cover Art: Thank you to Rawpixel