Ripple Leaps as Bitcoin Mini-Crash Rebounds
As you may remember on December 22nd, 2017 just before X-mas, Bitcoin fell from above $17000 to $12500. Not to mention we were used to its volatility by then, it was still a 1400% for the year.
What happend next, showed the decentralized globalization that cryptocurrencies represent. Ripples in one part of the world, influences the whole (no pun intended).
As cryptocurrencies were plummeting, something extraordinary happend to Ripple due to South Korea and Japan. Ripple overtook Ethereum to become the world’s second most valuable cryptocurrency by market capitalisation. Today it stands at $78 Bn. as opposed to Ethereum behind at $73 Bn.
East Asia Gives Ripple a Lift
Ripple bills itself as the:
How is that for a tag-line? As Millennials globally are storing an increasing amount of their investments in late 2017 in crypto stores of value that may have high ROI, Ripple has shown itself to be a big winner.
When three of Japan’s big credit card companies signed up to use Ripple’s technology, it was simply more evidence of Japan leading the way in BTC and XRP adoption. Like Bitcoin futures, this is a FOMO wave, where many other countries will have to follow.
The Market Cap of Cryptocurrencies is Skyrocketing
Ripple’s XRP token climbed to above $2 for the first time. That’s an increase YOY of more than 20,000% in 2017. Thought of another way, if you didn’t think cryptocurrencies were for real — consider this: Ripple’s current market value would put it among the world’s 30 biggest banks, ahead of the likes of UK’s Lloyds Banking Group or Japan’s Mizuho Financial Group.
The market cap of crypto assets and currencies may even be the beginning of a change in the financial order of how we store, invest and exchange our funds. Witness the rise in 2017 of Coinbase’s app. Cryptocurrencies have broken into the mainstream, and banks will have a hard time competing against cryptocurrency exchanges in many respects in the not-so-distant future.
If you think of how blockchain scales before 2020, you must consider how major institutions adopt cryptocurrencies. Ripple Labs is already five years old, working hard to sign up legacy financial orgs to build one seamless payment network ecosystem on the blockchain. When in mid 2018, the blockchain scales, who do you suppose will have a competitive advantage with B2B use cases in what once felt like a fledgling industry?
Sure 2017 has been a stunning year for several altcoins: bitcoin (1,500%), litecoin (5,000%), or ethereum (8,000%). But who has the scope to bridge the gap between mainstream finance and the new financial world? It’s Ripple.
If the Bitcoin ponzi scheme is fueling consumer interest and Ethereum is fueling the smart contract era of the blockchain, Ripple certainly has a lot of potential as well.
In early 2018, I’d wager Ripple, Cardano and Stellar all scan scale very well. In terms of the quality of ICOs we are also witnessing more innovative projects such as SingularityNET, Filecoin — Blockchain data storage network which raised $257 million, and Kik’s Kin Token. This means as cryptocurrency, blockchain and smart contracts become more mainstream, so too will the quality of ICOs we will bear witness to.
This isn’t just Crypto futures we are talking about, this means that to keep up with innovation, how we fund our startups might completely change as Venture Capital is investing less and less early startup funds that’s crippling innovation in North America. This is especially true when we compare the pace of innovation, R&D funding and new unicorns in China.
2018 is the Year of how Blockchain Scales
Forget Bitcoin reaching 20,000 for a moment, to the future of blockchain, Ripple hitting 2$ is much much more relevant.
This is because 2018 is all about how the blockchain scales, not just in terms of application but in terms of speed of transaction per second. The blockchain platform wars between Ethereum, NEO and Cardano is just getting started.
You cannot just anticipate the future, you have to build it. You have to hit tight deadlines to keep up, and as the rest of cryptocurrencies catches up with Bitcoin; we will witness the blockchain revolution and we still don’t fully imagine all that it will entail.
The Best Use-Case of Blockchain is Speed
Ripple’s cross-border payments system is electronic record-keeping system on the blockchain, that is, instantaneous transactions. As it’s a low cost between countries and currencies; it’s a force for globalization and decentralization that few can predict the precise outcome if it wins. If the American dollar is the gold standard of value pre 2020, what will be that same standard post 2020? The entire global economy is changing, and the next recession may be a proving ground.
If it takes legacy banks between 2 to 5 days to transfer fees across borders, with red tape and added fees and it takes Ripple a matter of seconds, who do you suppose will win?
In a world that’s going cashless (China is already there), we see WeChat Pay, Walmart Pay, Apple Pay, Amazon Pay and Alipay all gaining traction. Paypal is still around and Stripe is growing fast, the future of payments is getting seriously interesting.
The winner of payment ubiquity is likely to transform banking, forever.
Cross border payment solutions and peer-to-peer solutions are transforming the way we think of transactions and avoiding expensive bank fees. Transferwise, Venmo, Zelle and Ripple along with many others, will continue to change how we think of P2P and CBP.
There’s zero chance ethical consumer Millennials will just keep trusting banks ahead of all of these more convenient and faster alternatives. And, it should terrify legacy financial institutions.
The Key Use Case of the Blockchain is the Intersection with AI
As Ethereum seeks in 2018 to move in the direction of becoming a decentralized world computer that replaces server farms, the sweetspot is the intersection of the blockchain and AI.
The future of the blockchain then, has become so much more than just transactions or cryptocurrencies. In that decentralized world computer, the future of consensus and collective decision making, might mark the most radical political innovation since many thousands of years.
There’s no hiding that Government, politicians, the media networks, banks and many other domains could all seriously use an overhaul. Blockchain mediated by smart contracts and AI could be the answer.
The idea of physical banks, just like corruptible politicians, will soon become obsolete. It’s ironic maybe that it will take advances in AI, for us to implement the next levels of social justice, equality and improved well-being for all in a blockchain society. Ripple will play its part, and as cryptocurrencies scale in 2018 at faster frequencies per second, we might see suddenly the end of many legacy systems in favor of blockchain solutions and iteratives. Consider the classical example:
- Bitcoin is processing ~7 transactions / second
- Ethereum is processing ~15 transactions / second
- Paypal is processing ~200 transactions / second
- Visa is processing ~2,000 transactions / second but has the capacity to process 56,000 transactions / second
As the tech and consumption adoption continues in 2018, the Crypto Singularity will start to have more widespread B2B and B2C implications.
Correct me if I’m wrong?