Breanne Madigan, the head of the global institutional markets, in the case of Ripple, is of the view that the institutional money is not flowing yet in the Blockchain industry. To the institutional funds to attract and then to make it usable, it must reach the industry much better liquidity than the market currently has to show for it.
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Ripple expert, call-specific characteristics that help make a crypto currency to the Mainstream
After a devastating crash in mid-March, has recovered the Crypto-market is slow, with the most important digital Assets have their price levels prior Covid 19 again. The Belief that Bitcoin and Altcoins against financial crises were resistant, has suffered a severe blow and at the same time many of the a large Problem front of the eye led. Correlate crypto-currencies, in fact, with the broader market?
According to Breanne Madigan, head of global institutional markets, in the case of Ripple, the correlation exist, but their intensity seems to be the time lose weight. In an Interview with David Schwartz, the CTO of Ripple, she noticed that the beginnings of the Crypto industry found its roots in anarchy, your progress, however, the historic Patterns of traditional markets.
The only difference is that the Crypto seems to be to develop the market in exactly the reverse direction.
To make things clear, said the Ripple expert, that the traditional markets, driven initially by institutional investors, while the crypto-currencies on the back of a privately established investors. The money from Hedge funds, venture capitalists and banks flowed for nearly a decade in the room.
The Ripple expert explained that traditional markets such as equities developed first, index funds and Margin trading, and then various other trade welcomed products such as leveraged derivatives. The Crypto market crashed, however, on the derivatives.
In spite of many differences, both markets have, according to Madigan, many similarities. The demand of investors, both on the traditional markets as well as in the crypto currencies, is currently driven almost exclusively by speculation, which is why digital assets tend to move in parallel to stocks and commodities.
Crypto-currencies in the same basket as other assets, but it is not only a testimony of laziness, but completely wrong. Madigan said to the CTO of Ripple that the crypto-currencies are now slowly but surely started to have to decouple from other markets, most likely as a result of the ongoing COVID-19 pandemic.
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The pandemic has created what the Ripple expert, “a perfect test network for crypto-currencies” is called, since the financial measures such as quantitative easing and negative interest rates have shaken the confidence of the people in their governments. The destabilization of the Fiat currencies has also pushed the Macro-investors in the Crypto Space, as more and more companies to be traditional financial institutions to cynical.
Crypto currencies as an asset class, which thrive in a state of Chaos, have shown that they can be used as a hedge against Inflation and currency devaluation, new applications open up and more users attract.
Where to fit in Ripple?
The Abundance of retail users, however, will not be enough to make crypto-currencies to the Mainstream, at least according to Madigans opinion. What will help you gain momentum and the mass reach is institutional money.
Institutional money to attract the industry to reach what is called the Ripple expert, as a “deep liquidity”. There are four main characteristics of this type of liquidity that would make if you would be achieved through a single digital Asset, this is the perfect investment tool for both the retail as well as institutional actors.
The first attribute low cost of transaction, a characteristic of a network that would attract all types of users. Immediacy and resistance are in second place, followed by the width. Madigan width defined as the number of trading pairs and instruments for a crypto-currency available, and enable their users to move funds. The last and probably the most important attribute of a liquid Cryptocurrency, the depth or the Wealth of jobs that are slightly above or below the current trading price of an asset is.
In short: An asset with high liquidity that is traded more often and as a result, both for private investors and for institutional investors is more attractive.
Read also: Ripple can win 4 new Partner – influence on XRP price?
When it comes to Ripples Position on the Crypto-market, said that the company wants to develop products that use the XRP provided a kind of liquidity and one of the biggest hurdles for investors in cross-border transactions solve.
With a real application case, they are expected to both XRP as well as other crypto-liquidity currencies will significantly improve. Another factor that will contribute to the Ripple expert, to improve access to crypto-currencies by providing more opportunities for trade with the assets value will be created.
However, both Ripple as well as the Rest of the Crypto before market are still a few hurdles. Madigan said that the creation of new products and instruments of institutional quality must not only be regulated in the USA but also around the world. The current lack of clarity is for everyone in the industry is a large Problem and he will certainly do nothing to attract regulation-conscious companies in the Crypto Space.
But to carve laws in stone, was also not the best approach, so the Ripple expert. The fast pace of the industry requires flexibility, not control the governments very well.
Flexibility will be the key to account for the various products and also the changing technologies. We need clarity from the regulatory authorities, but then we don’t want it to be too prescriptive and specific, that we stifle Innovation. A number of global jurisdictions have started in a positive way, to take the lead in establishing the framework. This was extremely helpful, but we need a consistent approach around the world.
If anywhere in the world, the same Standards are applied, it is ensured that no country and no company missed the opportunities that cryptocurrencies and the Blockchain technology in General. Madigan believes that it is detrimental would be, behind the global efforts to regulate the industry to stay behind.
If the US is not fast enough, in order to develop a constructive policy that we are going to experience, perhaps, as strong innovators and leaders in this space, your company to settle in other jurisdictions.
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