/biz/ - Business & Finance

>>18166730
Me too anon

6M never selling til $0.25

>>18166840
tfw i need more.

>>18166730
This is the best investment right now on biz

>>18166730
>>18166743
>>18166840
>>18167200
>>18167942
RSR has VERY LITTLE utility in the Reserve ecosystem besides DILUTING THE SUPPLY. The team has created a false narrative that you can make a lot of revenue through RSR/RSV arbitrage, which would create demand for RSR in the long run. But is it true? Lets dive in.

1) An excess pool of RSV has to exist in order for RSR holders to be able to arbitrage with RSR. How is this pool of excess RSV created? A) when the collateral for RSV appreciates in usd value ABOVE the collateral target B) from tx fees collected for RSV transactions (velocity). That means you as a RSR holder CAN’T arbitrage until the vault is optimized to produce revenue/gain value against usd and/or a significant amount of RSV is being transacted with, which both are expected to occur years from now.
2) RSV has to trade above $1 in LARGE volumes for the arbitrage process to be in any way profitable, which is very unlikely to happen – if RSV does trade above $1 peg, it will be in small amount of buy orders (explained in next pg). Not to mention that the Reserve foundation will ALWAYS have a first actor advantage, deflating the pool of excess RSV tokens BEFORE any of the regular holders will have a chance to participate
3) Even if the protocol has accumulated a deep pool of excess RSV through collateral appreciation and tx fees, arbitrage with RSR would still ONLY be possible if RSV trades above $1 and ONLY for the quantity of RSV that is being sold above $1. Why would anyone buy RSV above $1? Rational/educated market participants WONT, because if they wanted to buy/use RSV they could instead just mint it for $1 worth of collateral tokens instead of buying from the market with a PREMIUM price. Thus, one would project that the quantity of RSV trading above the peg is minimal, resulting in a very small revenue stream for RSR holders.

>>18167970
Where does RSR then play a role? When the vault portfolio depreciates in value, the protocol will mint AS MANY RSR NECESSARY in usd value to INSTANTLY SELL on EXCHANGES for the deficient amount of collateral assets to get back to the target collateralization ratio. When new RSR gets minted, the circulating supply of RSR will be inflated, inherently lowering the value of previously existing tokens. Not only because there are now a huge amount of new tokens in the circulation, but also because the newly minted RSR were market sold as per the smart contract associated with the RSR/RSV arbitrage mechanism.

Example: if we have 100m RSV in circulation and the underlying collateral depreciates 5%, the protocol would need to mint and SELL $5 MILLION WORTH OF RSR tokens. When the current RSR market cap is only $16 million, vault deprecation would have a DRASTIC NEGATIVE IMPACT on the market price of RSR, making it EXTREMELY RISKY and unattractive to hold.

>>18167970
>>18167988
cope

>>18167970

>>18168843
I addressed this in the 3rd paragraph.
RSV wont trade above $1 often and in large quantities because you can mint RSV for $1 worth of collateral tokens instead of paying a premium price on the market. Only a few low IQ crypto plebs would buy RSV above $1 (demand). Professional market makers and traders will exclusively only buy RSV either under $1, $1 or mint it for $1 worth of collateral assets in case RSV is trading above the peg.

>>18168933
RSR has always been a moonshot. It will only be profitable if countries start adopting it. We'll know from the Venezuela trials.

This is a high risk investment. But if it works out you will become a millionaire. Let me address a few of your points:

Where the actual moonshot comes in is when tons of people start using Reserve. This will increase the demand of tokens and obviously that will make the price increase.

Eg, you buy now at fractions of a penny and in a few years it'll go up to a few dollars.

(1) Making money through arbitrage isn't what us 4chan fellows will be doing. All arbitrage is doing is adding incentive for the rich people to hold their multi million stacks because they will be making good ROIs from their investment. This doesn't apply to people buying now because we don't have massive amounts of RSR to arbitrage.

(2) Again, remember that the amount of RSV circulating depends on the vault manager. The Reserve team will obviously have incentive to make sure arbiters are making money.
(3) See prior points

Remember, us anons won't be making money off of arbitrage. The point of arbitrage is so big investors who are risk averse will hold their Reserve tokens.

Us anons will make money by buying Reserve now. The only way we will get rich is if Reserve becomes hot shit within the next few years.

>>18169983
As a gambler. The odds on this mooning are greater than the odds at a casino. But gambling always is a risk. More study required...

>>18168933
This anon makes good points.

At 0.002 I'd hope for a X 10 at least in a short timeframe