The truth about Reserve Rights

[Anonymous No.18163232]

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 really so? Lets dive in.

1) An excess pool of RSV has to exist in order for RSR holders to be able to go through an arbitrage loop with RSR tokens. How is this pool of excess RSV created? The underlying collateral for RSV has to appreciate in usd value ABOVE the collateral target. That means you as a RSR holder can’t arbitrage until the vault portfolio is optimized to produce revenue/retain value against usd, which is unlikely to happen for YEARS.
2) RSV has to trade above $1 in LARGE quantities for the arbitrage process to be in any way profitable, which is very unlikely to happen – if RSV does trade above 1$ peg, it will be in small amounts of buy orders. 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 people will have a chance to participate

[Anonymous No.18163238]

continued..

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 collateral depreciates 5%, the protocol would need to mint $5 million worth of RSR tokens to sell for collateral assets to get back to the targeted level of collateralization (in reality there would never be that amount of buy orders on exchanges). When the current RSR market cap is $16 million, any vault portfolio deprecation would have a DRASTIC NEGATIVE IMPACT on the market price of RSR, thus making it EXTREMELY RISKY and unattractive to hold.

[Anonymous No.18163265]

>>18163232
duh, we already have many stable coins

[Anonymous No.18163285]

You do realize every time you try to fud rsr you actually promote it? also TL;DR

Maker worked and it's super autistic and gay. RSR will absolutely explode.

[Anonymous No.18163293]

>scam coin is a scam
We know faggot

[Anonymous No.18163307]

Peter Thiel sucks cocks and eats cum

[Anonymous No.18163420]

>>18163285
if you think that's FUD, how about refute what's been said?

[Anonymous No.18163505]

i sold all mine after seeing it had to be fully integrated with link oracles first to make a working product. biggest redflag

[Anonymous No.18164240]

>>18163232
the truth is that noone cares.
we gonna fill up our bags with all kinds of great shitcoins, including this, no matter what.
then we gonna be millionaires in 2 years.
the crypto game. that easy.