Cope

Finance, over the course of the last 30 years or so, has slowly devolved from a tool for professionals to help laymen navigate a monetary minefield to every man for themselves.

While there’s always benefits to deregulation and the democratization of tools — a perfect example is how film transformed into video, and video transformed into digital media, and now anyone can film anything all the time — it also displays the worst parts of human nature regularly.

Time to discuss Ripple and XRP again.

What Happens When People Begin to Lose Hope?

There’s an annoying cliché of a chart that gets tossed around in financial circles about bubbles. You’ve probably seen it:

In this reality, hope is followed by optimism and belief. But in finance, there’s an alternative to this, and that’s when all hope starts to disintegrate. What may be expected in this sequence of events is that the step after losing hope is capitulation — but that isn’t the case.

Time and time again we see that big losses (be it in the stock market, commodities, cryptocurrencies, or at a casino) result in the sunk cost fallacy. If you’re familiar with gambling or investing, then you’ve probably not only heard of this, but have experienced it first hand. To sum it up very quickly: you buy a stock, it goes down in price, you buy more, it goes further down, so you buy more. That’s it.

It’s hard to explain why humans who are starting to give up attempt to recoup losses. The best explanation I could think of was the Kübler Ross grieving curve:

Grief in Finance

Let’s put the current wares of Ripple/XRP into the scope of the Kübler Ross curve.

The “shock event” here would be the SEC filing a suit against Ripple/XRP — and not any old suit, a rather disastrous one. No one who has read through it walked away with the understanding that Ripple would come out unscathed. The suit has bad news written all over it.

But many XRP bagholders — instead of taking the time to read the lawsuit and listen to knowledgable lawyers discussing the likely outcomes — have pushed the concept the everyone should “BTFD” (buy the f*cking dip).

This meets the definition of “refusal to understand.”

Where Are We Now?

As far as I can tell, we’re currently in the “resistance” phase of the march toward “reintegration” for most XRP bagholders.

Meanwhile, some of the executive leadership seems to have already moved onto the “catharsis” phase — such as when David Schwartz more or less admitted to, openly and publicly, the fact that “giving away [XRP] became impossible.”

Expect more of this: people making a conscious effort to acknowledge their faults and the issues with XRP, while still professing some sense of guilt about the entire affair. It may be weeks or months, but it will happen. And then many or most of these people will entirely give up on Ripple/XRP.

Relating to C O P E

Twitter is a land where people tend to rejoice in others’ pain — it’s hard not to when the people being financially ruined have gone out of their way to tell everyone else how and why they’re wrong constantly. But as someone who definitely leaned in the trollish direction of ridiculing these individuals, I aim to change my ways.

I don’t write this piece out of spite, or call the XRP bagholders “dumdums” because I hate them or want to see them suffer. If anything, these articles and tweets were attempts to let these people know they’re holding an extremely risky, volatile, and, likely, illegal unregistered security. Few retail investors can properly fathom that level of risk, let alone make money investing in it. I urge people to reexamine their options if they’re still considering putting money into or keeping money in XRP.

I am not a lawyer. I am not a psychic. I am not a journalist. But read the room, XRP bagholders, and consider that if you’re telling everyone else they’re the crazy and stupid ones, well, maybe, just maybe, the world isn’t crazy and stupid. Maybe it’s you. While you reflect on that, remember these two valuable phrases:

• better to remain silent and be thought a fool than to speak and remove all doubt
• a fool and his money are soon parted

Stay skeptical, friends. And try not to “stay poor” XRP bagholders.