NEWSLETTER
A new proposal sent to the Exchange and Securities Commission of the United States (SEC) <a target="_blank" href="https://www.sec.gov/about/crypto-task-force” target=”_blank” rel=”noopener”>Cryptographic Working Group By a Maximilian Staudinger defends XRP as a “strategic financial asset” for the United States (using some very questionable mathematics and logic).
I am here to tell you that XRP is not a strategic asset and that the logic in this proposal is doubtful at best.
In the proposal, Staudinger states that $ 5 billion are locked in the US. Nostro accounts (Accounts that banks use for cross -border payments). And he states that if certain regulatory conditions were created, including the SEC that classifies XRP as a network of payments, the United States Department of Justice (DOJ) that provides legal authorization for banks to use XRP, and the Federal Reserve that forces banks to use XRP as a liquidity solution, then 30% of this capital ($ 1.5 trillions) will be released for the US government 25 million bitco at $ 60,000 per bitco bitco.
So, let's break down why it makes little sense.
First, nostro accounts are simply bank accounts that US banks have in foreign countries. I am not sure what type of logic includes these national banks that reveal the US dollars that XRP theoretically replaced the federal government so that these dollars can be used to acquire bitcoin on behalf of the Government.
Secondly, the proposal does not offer details about how these national banks would get the XRP that would replace the dollars. It only seems logical that they have to buy the XRP, which leads to XRP absorbing these $ 1.5 billion, no bitcoin. Even if Ripple, the XRP issuer, would simply would like to give these XRP banks to use, this would still not work, since it only remains $ 100 billion in XRP – Much less than $ 1.5 billion.
Thirdly, even if the price of bitcoin is submerged at $ 60,000, the price would begin to immediately increase as the United States government began buying the 25 million bitcoin.
Finally, there is a hard limit of 21 million bitcoin (and Approximately 4 million have been lost), which is a well -known fact in the bitcoin or cryptography space. Therefore, it is quite silly to suggest that the United States government could buy 25 million bitcoin. If the author were even a serious average person, he could have suggested that the government bucify 15 million bitcoin at $ 100,000 per bitcoin (although mathematics would not work yet).
Given how defective it is the logic behind this proposal, it is difficult to consider XRP a strategic asset. In addition, why would the United States government do it when two thirds of the offer are still in the hands of the organization that issued the asset? It doesn't make much sense.
bitcoin, on the other hand, is a globally distributed asset that many use worldwide as money and a value reserve. In addition, the bitcoin network is governed by tens of thousands of nodes And it is practically impenetrable, thanks to the approximately <a target="_blank" href="https://www.polytechnique-insights.com/en/columns/energy/bitcoin-electricity-consumption-comparable-to-that-of-poland/” target=”_blank” rel=”noopener”>0.4% of the world's energy that protects it. (The XRP network is governed by 828 nodes and is not protected by any amount of energy.) These factors make bitcoin a logical reserve asset, which is how the United States government now officially classifies it.
Then, hopefully, the SEC already understands what I have outlined in this piece and does not spend much time even considering Mr. Staudinger's proposal.
This article is a shot. The opinions expressed are completely from the author and do not necessarily reflect those of btc INC or bitcoin magazine.
