The reason why XRP will be adopted
During my latest cryptocoins research, I found this nicely written post I thought I'll share with you. It has been written by the person who is claiming 30 years of experience in the banking industry.
Read the whole topic; it truly makes me believe in Ripple success.
There is an excellent explanation of counterparty and no-counterparty risk and why it will play such an important role in Ripple success ( still had to read it a few times to fully understand )
The reason why XRP will be adopted
XRP is the native currency of the Ripple network that only exists within the Ripple system. Not dependent on any third party for redemption, XRP is the only currency in the Ripple network that does not entail counterparty risk and it is the only native digital asset on the Ripple network. Any other digital asset (non-XRP) existing on the Ripple network is a debt instrument (a liability) and exists in the form of a balance which entails counterparty risk. Eliminating this risk is why XRP will be adopted over any other digital asset.
A counterparty risk, also known as a default risk, is a risk that a counterparty will not pay as obligated. Financial institutions or other transaction counterparties may hedge, take out credit insurance or, require the posting of collateral. Offsetting counterparty risk is not always possible because of temporary liquidity issues. Counterparty risk increases due to positively correlated risk factors. Accounting for correlation between risk factors and counterparty default in risk management methodology is not trivial. XRP removes both the counterparty risk and the associated costs 100%.
The elimination of counterparty risk IS the reason why XRP will in fact be adopted by everyone who uses the Ripple network. Notice how Ripple (the company) has been focused on implementing their solution globally in the banking sector and not focusing on the promotion of XRP. Why? Because they don't have to. XRP is to the Ripple network as plasma is to the blood in the human body. Focus your attention on Ripple's ability to implement quickly and broadly across the globe and that will translate into XRP strength and growth.
Disclosure: This information was compiled from secondary sources and summarized for simplicity.
more at https://www.xrpchat.com/topic/6362-the-reason-why-xrp-will-be-adopted/
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