Ripple Explains How XRP Price Will Be Invisible to Customers

A recent post by crypto researcher SMQKE (@SMQKEDQG) has drawn attention to Ripple’s perspective on XRP’s price and its impact on liquidity. The tweet includes an excerpt from a 2018 document discussing the significance of XRP’s value and a video featuring a Ripple spokesperson explaining how customers interact with the digital asset in cross-border transactions.

XRP’s Price and Liquidity

The document referenced in the tweet highlights a key point regarding XRP’s price and its role in enhancing liquidity. It states, “if XRP has a higher value, it increases the value of the solution because it increases liquidity on the network. With a higher value, XRP can convey a higher value than other currencies” (Hamilton, 2018). This statement suggests that a higher valuation of XRP benefits the network by improving efficiency in transactions.

Additionally, the document discusses the rise of XRP in early 2018, noting that “when XRP was over $2.5 per coin at the beginning of 2018, Chris Larsen, Ripple’s co-founder and former CEO, was among the richest people in the world due to his shares of XRP and equity in the company.” This historical context underscores the asset’s potential for significant value appreciation.

Ripple’s Approach to Customer Transactions

In the video shared by SMQKE, a Ripple representative addressed how customers interact with XRP when using Ripple’s payment solutions.

When asked about the effect of XRP’s price fluctuation on the part of the customers, they said “As a business that’s been in this industry for a long time, we know that the senders and receivers are very focused on fiat. That’s their lifeline, that’s their blood, that’s their entire business. So we hide any real visibility into the cryptocurrency XRP. So in the system, you’ll really just see a fiat-to-fiat payment option.”

The explanation clarified that businesses using Ripple’s solutions are not directly exposed to XRP’s price volatility. Instead, they experience a seamless transaction process where XRP operates in the background as a bridge asset.

The spokesperson continues:

“Because of that, we hide and protect our customers from any fluctuation in the open market. It’s irrelevant to you how much XRP equals how much Singapore dollars, for example. All you want to know is that you can make your $1 million payment into Vietnam, for example. So the customer is never exposed to any fluctuation in price of the digital asset here.”

Implications for XRP’s Role in Ripple’s System

SMQKE summarized this information by stating, “Ripple’s solution relies on XRP being a high price.” This aligns with the claim in the document that a higher value for XRP enhances liquidity and strengthens the network’s functionality.

While the customers of Ripple’s payment solutions do not directly engage with XRP’s price fluctuations, the asset value remains crucial in ensuring efficient and large-scale liquidity.

The discussion sparked by this post highlights the dual nature of XRP within Ripple’s ecosystem. While businesses benefit from the streamlined fiat-to-fiat experience, the underlying role of XRP in enabling these transactions depends on its liquidity and market value.

Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.

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