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Comment by throw9991999 | Hacker News Reader

throw9991999

$29M worth of XRP going to a good cause. Great, cash out and make good use of it.

The cynic in me sees this as a cheap PR move (an SVP of marketing promoting it doesn't help). Associating your token with a good cause gives it credibility in the eyes of the public which in turn leads to an increase in the XRP price in USD. Here's what I understand about ripple:

- 100 billion XRP was created at inception with 20 billion going to the creators and 80 billion going to Ripple labs.

- It's supposed to be a payment layer between financial institutions and XRP is the underlying token.

- Distribution of XRP is arbitrary. Ripple labs can allocate it to whoever they see fit.

Donating $29M worth of XRP costs them nothing since Ripple labs holds 80 billion XRP. Only 40 billion XRP is currently in circulation though and XRP's price is currently $0.5. I don't know, I find Ripple quite ridiculous. But the silver lining is donations such as these.

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> Donating $29M worth of XRP costs them nothing since Ripple labs holds 80 billion XRP.

This is the key.

Ripple has donated $29M value out of the portfolios of their XRP-holders. The effect of this, might be a net-increase of that value, though, since the marketing-effect might even pump the price.

If you own XRP, you just donated a fraction to a good cause. Congrats.

Very similar to how Europe "printed" money to "save Greece" several times. A worthy cause, but paid by everyone holding Euro: every Euro just gets some inflation and the shaved-off value is used "for the good cause". I'm not saying inflation is bad, that is not my point. Nor that giving to good causes is bad, and my point is also not about wether or not the combined wealth of Europeans should be used to save a county.

My point is that giving away other peoples money is easy and hardly ever presented as such.

If you own Ripple, you should hopefully already be aware of how much of it Ripple owns.

It gets better. The intermediate layer is controlled entirely by Ripple and closed source. The coin only exists to provide 'liquidity' and improve confidence from financial institutions. In essence, Ripple is just a payment processor riding on the crypto hype and the coin is simply an unregulated stock. This is the latest attempt to pump prices and generate PR. No one makes money when prices are stable.

(If anyone reading this likes their products, that's fine. Just realize what you're getting into first. It's actually a very entertaining currency to watch from the sidelines.)

> The coin only exists to provide 'liquidity' and improve confidence from financial institutions.

Can u please elaborate what are the other traits a coin can exhibit other than providing value? And what are the other purposes of coins such as bitcoin/litecoin/ether etc.

In case of Eos, you need to own the tokens to run smart contracts on the network (mire you have, more % of processing power you get).

In case of Ether, besides being used for transaction fees, it will be used for providing security/governance (token holders kind of voting on what the next blocks are), but also as an underlying store of value (e.g. as a collateral for tokens pegged to fiat currencies - see MakerDAO)

The only reason Ripple is worth anything is because of PR to convince the world that a wholly premined coin that isn't even necessary to use the Ripple network holds any value at all. So... a $29 million PR move to boost a $22 billion PR move?

Well so if the coin is totally useless, then at least funding charities with it is about as good as it gets right?

I mean it makes me feel less bad about my $5k loss on xrp.

It's like taking a loan using magic beans as collateral.

It's not necessary for the payments layer, Although the asset can be used for the settlement layer, as can a lot of other tokens be used (see ILP: inter ledger protocol), I have used bitcoin and ether, all I can say is that XRP is by far the cheapest and fastest way to settle right now.

It is impossible to mine ripple and it's cheaper to use Xrapid when making settlements, making XRP not neccesary but incentivized.

When does it become not a cheap PR move?

When it actually costs something to the donor? If somebody living below the poverty line donates $100 to a cause it's a pretty selfless act. If Bill Gates does it then not so much.

It's great that Ripple decides to donate money to charities but it's not like they're making a huge sacrifice here. Given the highly speculative market surrounding crypto the good PR this gives them might very well end up making them significantly more money than what they donated.

False. Those $100 are not enough to save people from malaria but the kind of money Bill Gates has did; doesn't matter how much you fought to obtain a single dollar and then you donate it; it helps just as little as it you found it on the floor.

Thought experiment: imagine that I'm a huge multinational company who makes billions in profit. Imagine that I evade (or "optimize") my taxes as much as possible using all the tricks in the book. Now I decide to invest a few hundreds of thousands of dollars to, say, donate computers to schools. It's great, isn't it? But wouldn't it make more sense not to do that and simply pay my taxes instead, which would probably end up contributing a lot more to the school system and the rest of the infrastructure? Isn't it effectively an empty PR move to make me look like the good guy even though I'm actually saving a lot of money by not paying what I really owe?

I'm not arguing that Ripple did a bad thing but I'm not in the position of somebody receiving the donation but rather in the position of a 3rd party who has to form an opinion about it. Clearly this is a good action on Ripple's part, as would be Bill Gates donating $100 to some charity but morally speaking it's not like it was a huge sacrifice. I'm very skeptical of the ethics of these cryptocurrency organizations and I'm not willing to suddenly consider them the "good guys" because they made a (for them) rather minor donation. As far as advertising campaigns go it seems like a pretty clever move that may well pay off way beyond $30millions for them.

There's no "False" or "True" when discussing the morals of these acts, you can make a good action for bad reasons and a bad action for good reasons. In practice it's great that Ripple did this though, regardless of the reasons, I agree with that.

Morally speaking you are a random nobody on the internet complaining about a guy's morals who has built an industry that has substantially increased our GDP and lifestyle and now is having a substantial impact on decreasing global poverty and is going to put all the value he fairly earned back into the economy when he croaks in 20 years

> complaining about a guy's morals

> the value he fairly earned

I see what you did there.

That is incorrect, Ripple committed to place 55 billion XRP (88% of its XRP holdings) into a cryptographically-secured escrow. You can read about it on Wikipedia.

This is hardly a silver lining. 29mm pales in comparison to the amount of money they have ponzi'd out of the common investor who has bought into this.

in addition while 100 bilion were/are due to be created, that is not a hard limit and an infinite number can be created at any point.

Does it matter if it's a PR move or not?

Yes.

No it doesn't, because at the end those kids will get 29 million dollars worth of materials and educational resources. I wish more PR moves were about donating and helping those in need.

It does to me because I value selfless donations more than those with an ulterior motive. Of course a donation to a noble cause is always a good thing regardless of that but it doesn't mean that you shouldn't discuss its motives.

I don't think anybody here is arguing that this donation is a bad thing.

I disagree. Regardless of intentions, the projects received money they otherwise may not have. Everyone knows this was likely for the attention, but look at what that PR desperation accomplished.

Wow take a breathe and think about 29m -> kids. It’s a good thing.

If a PR stunt helps a good cause, I'd say it's a win-win.

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