Buying Reserve Rights: how to invest in RSR?
If you are interested in trading or investing in cryptocurrencies, there are plenty of options to choose from. There were over 7800 different cryptocurrencies in circulation in December 2020 according to CoinMarketCap, a website where you can find all the statistics about cryptocurrencies. One of those cryptocurrencies is Reserve Rights.
Reserve Rights sounds a bit like a disclaimer, but its founders have created a decentralized stable coin platform and aim to build a fair monetary system. That sounds like a great ideal, but how will Reserve Rights achieve it?
The question for you as a trader is of course whether it is worth investing in that platform. In this article, we will go deeper into the ideas behind Reserve Rights, and you can find an analysis of investing in Reserve Rights. You can also find the price forecast for Reserve Rights for the coming years in this article.
How to buy Reserve Rights (RSR)?
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Reserve Rights trading: what is Reserve Rights?
Most cryptocurrencies are more than just a new digital currency. There is usually an innovative idea or application behind it based on blockchain technology. This is also true for Reserve Rights. Behind the coin Reserve Rights (RSR) is an organization called Reserve that describes itself as a collection of people who believe that cryptocurrency can work better than fiat money, such as Pounds and Dollars.
Runaway inflation and corrupt governments
According to Reserve, one reason why fiat money does not work well is because your money is not safe. This can be because of banks where your money is not safe or because of bad monetary policies of corrupt and centralized governments. And in some countries, people simply do not have a safe place to keep their money. In countries like these, runaway inflation occurs, devaluing the purchasing power of fiat currencies.
A robust, economically strong currency to replace fiat currency
Reserve also believes that our current fiat money is an impediment to trading with anyone in the world, i.e. across borders, freely and without friction. This is the reason for Reserve to create a stable, decentralized currency. Because the currency is decentralized, it cannot be abused or manipulated by any government. The team’s goal is therefore to eventually create the most accessible and robust, economically powerful currency that can be replaced by it.
Safe currency for all
For us, a safe and stable currency which cannot be abused may not be as urgent. But there are billions of people worldwide without bank accounts, and countries where banks have problems keeping money safe. Some countries are considered risky by international financial institutions and their citizens cannot open an international bank account. Citizens of those countries experience restrictions that make it hard to conduct business.
That is why the Reserve Protocol was developed, to bypass corrupt bankers and governments, so everyone in the world can have a secure supply of currency that cannot be stolen by banks or blown up by governments. The ultimate goal is to create a decentralized stable currency that is immune to hyperinflation and independent of fiat money.
Investing in Reserve Rights: What is the Reserve Protocol?
The Reserve Protocol is designed to create the most accessible, economically powerful and robust currency in the world. The protocol is built on Ethereum, but there are plans to implement the protocol on top of any smart contract platform or blockchain. The protocol consists of three tokens: The Reserve Token (RSV), the Reserve Rights Token and Collateral Tokens.
The Reserve Token (RSV)
RSV is a stable cryptocurrency that can be used as a method of payment, stored and issued in the same way as we use US dollars, the Pound and other stable fiat money. The RSV is designed to be fully collateralized, with the collateral held in a ‘reserve vault’.
This reserve vault is actually a smart contract used to pool and hold the assets that form the collateral of the RSV. The vault is funded by charging a 1% fee on all RSV transactions and any capital gains from the assets in the vault.
The RSV was launched in 2019 and at the time of the launch, the collateral was the USD Coin (USDC), TrueUSD (TUSD) and Paxos Standard (PAX), but the team is aiming for a ‘vault’ with 100 different low-volatility assets to serve as collateral for the RSV.
The three primary functions of the RSV token are:
- Protecting savings against hyperinflation
- Facilitating low-cost transactions between countries
- Ensure a more reliable and robust financial ecosystem for traders in developing countries.
How is stability maintained with the RSV token?
If the demand for the token falls, this would logically mean that the price would also fall.
On the Reserve blog, a very insightful image illustrates how stabilization works.
Suppose the redemption price of 1 RSV is $1. If the market price falls to 98 cents, there will be an incentive to buy RSV and redeem it with the smart contract for $1 collateral tokens. That will continue until it is no longer profitable to buy and exchange RSV tokens. The price will then stabilize on $1.
Conversely, as demand increases and the price of RSV rises to, say, £1.02, traders will buy the new RSV coins for 1 and then sell them for a profit. This will also continue until the price on the market drops back to $1 due to the RSV sales.
The Reserve Rights Token (RSR)
The second token in the Reserve Protocol is the Reserve Rights Token (RSR). This token has two primary functions:
- It is a utility token that can be used to vote on board proposals.
- It helps to keep the RSV value at the target price of 1 US Dollar.
Unlike the stable RSV, the RSR token is volatile. The RSR token is used as an investment object, and the proceeds finance the Reserve Protocol project. Despite being volatile, the RSR token can also be used to guarantee the collateral percentage and linkage of the RSV.
On the Reserve website you will find an illustration of a flowchart showing how the Reserve Rights Token can be stabilized.
If the assets in the Reserve vault decline in value and can no longer be covered by the existing RSV and there is an increase in the total supply of RSV, the number of RSR tokens in circulation will decrease as a result. This is because the arbitrage opportunity can only be utilized by selling RSR.
These are collateral tokens that are used to support the value of the RSV, and is similar to how gold was once used as collateral for money. The protocol is designed so that the collateral tokens represent at least 100% of the value of all Reserve tokens. The collateral tokens represent economic value in the real world such as bonds, real estate, commodities and other assets.
How can you invest in Reserve Rights?
There is a difference between trading and investing in Reserve Rights. Trading in RSR focuses on the short and medium term. As a trader, you make use of the price fluctuations.
Investing in Reserve Rights, on the other hand, is a long-term investment, also known in the crypto world as HODL (Hold On for Dear Life). This buy-and-hold strategy is a lot easier to understand than day trading, and therefore it is also accessible if you are just starting out with cryptocurrencies. You don’t have to keep an eye on the prices every day, but you speculate that in the long run your investment will become more valuable.
Investment strategy for Reserve Rights
When you want to start investing in Reserve Rights, you determine an amount to set aside each month. This can be a relatively small amount, or what you can afford to lose each month. Next, analyse what the market and the RSR price is doing. Look at what the currency has been worth in the past and whether there is a rising or falling trend. Then decide on an amount that the value of the coin should fall below to buy.
If the price actually drops and the predetermined point is reached, you buy the coin. This can be done on a trading platform like Bitvavo. If you bought the coin, you keep it in your crypto wallet. Long-term retention is at least over a period of months, but often over a period of years.
Where can you buy Reserve Rights?
Reserve Rights (RSR) is currently a popular token with excellent liquidity. You can buy and trade it on the most well-known and reliable cryptocurrency exchange platforms such as Bitvavo and you can trade it against several popular cryptocurrencies including Bitcoin (BTC), Tether (USDT) and Ethereum (ETH), as well as fiat currencies such as the US dollar and the Pound.
Bitvavo is a popular Dutch exchange for buying and selling crypto coins. It is known for its low transaction fees of 0.5% and fast transaction processing.
Some features of Bitvavo:
- It is safe and stable and known for good user experiences.
- Transaction fees are only 0.25%.
- Support for the best known cryptocurrencies.
Go to Bitvavo’s online platform here:
How do you store the Reserve Rights coins?
You store your crypto coins in a crypto wallet. You can choose from software or hardware wallets. Software wallets are in fact programs or apps you can open on your smartphone or computer. If you have many different currencies, and not in too big quantities, it’s best to use a software wallet. A hardware wallet is a device with memory storage and looks a bit like a memory stick. A hardware wallet can store larger files and is more secure.
Which crypto wallets can you use for investing in Reserve Rights?
The RSR token is an ERC 20 token based on the Ethereum blockchain. It is therefore best to use a crypto wallet supported by ERC 20. For example, you can use one of the following ERC20 wallets to securely store your RSR tokens:
If you are planning to buy large quantities of RSR, you should use one of the following hardware wallets:
What makes investing in Reserve Rights interesting?
Reserve consists of a team of extremely passionate people who have earned their stripes in the fintech world. The Reserve team is also assisted by advisers with impressive credentials, including monetary economist Garett Jones and former SEC commissioner Paul Atkins.
Moreover, the project has managed to attract a number of well-known investors, including Peter Thiel, the co-founder of PayPal.
Apart from the investments, the company has enormous growth potential in the financial services sector.
A solution to hyperinflation
The Reserve Rights Protocol could provide a solution to the problem of hyperinflation. Countries such as Venezuela, Argentina, Iran, Zimbabwe, Sudan, Yemen and Turkey are regions with high inflation rates and have poor free market exchange rates of the USD. Therefore, the Reserve team wants to convince the entrepreneurs and communities in these countries of the importance of their cryptocurrency.
What are the risks of investing in Reserve Rights?
To be globally accepted as a peer-to-peer money transfer medium, Reserve needs a highly scalable blockchain. But their main net token was launched on Ethereum which struggles with this very scalability. If they do not move to a faster blockchain, their ultimate goal seems hypothetical and realistically unachievable.
And although Reserve Rights is intended to be a fully decentralized open-source project, the team has yet to release their code.
Competition from other stable coin projects
It is common knowledge that cryptocurrencies are extremely volatile in nature. Therefore, numerous stable coins have already been developed to provide traders and holders of cryptocurrencies with reliable long-term prices. Most major stablecoin projects such as Tether (USDT), Paxos Standard (PAX), USD Coin (USDC) and Binance Coin (BUSD) all have the US dollar as collateral.
Reserve Protocol stablecoin RSV does not. It is impossible to say how RSV compares to its rivals as no circulating supply data is available and thus no market capitalization is listed on Coinmarketcap.com. But it is clear that Reserve is not the only party striving to become the leading stablecoin.
The stablecoin of the world?
The Reserve Protocol team clearly intends to become the stablecoin of the world, and want to expand their token ecosystem to include a range of cryptocurrencies including some that can be used for long-term investments. By launching the protocol in high inflation countries such as Venezuela and Argentina, and by targeting emerging market economies, the team believes they can gain a competitive advantage. While this is indeed the case for these countries, it remains to be seen whether it will happen on a global scale.
Investing in Reserve Rights: How will the Reserve Protocol evolve?
The project’s user base is growing, but this is only the beginning of what the Reserve Protocol team has in mind. Their plan is to expand the decentralized network to countries all over the world. There are also plans to add other functionalities, such as processing card payments, automated currency exchange, handling payrolls and much more.
It is not yet proven, but the Reserve Protocol team believes that entire economies can run on cryptocurrencies. They also believe that, through the peer-to-peer approach, it will remove the oversight and regulation often associated with financial systems.
Save and execute transactions with the Reserve Protocol
The Reserve protocol has already released its mobile app in several South American countries. Among its users are entrepreneurs and ordinary people from Venezuela who use the low-friction transactions made possible by Reserve Protocol.
They also benefit from being able to save and conduct transactions in a currency other than their Venezuelan peso, which is highly inflationary. The protocol works quite straightforward. A user uses the app to buy RSV and select a method of transfer.
The transfer goes to one of the Reserve Protocol network traders who fulfil the request by sending RSV. The user can then spend the RSV as he wishes.
Is Reserve Rights a profitable investment for the long term?
The team faces a significant challenge in directly targeting high inflation countries and emerging market economies. It is no small task to establish a global network of sellers and users in that sector who are committed to using RSV tokens.
The project is highly speculative and requires the team to continuously learn new things and adapt as the project grows. And undoubtedly the complexity of the project itself, combined with the difficulties of economically inefficient countries, will create unforeseen problems that must be addressed.
Reserve has already made considerable progress, but it is a long-term project. There is no telling when the project might begin to move towards full independence and decentralization, but those who share the philosophical thinking behind the project and Reserve’s goals can support the project by buying and holding RSR governance tokens. If the project achieves its goals, this can be a very profitable investment in the long term.
Investing in Reserve Rights: What is the price forecast?
The Reserve Protocol is being used more frequently which makes it a more appealing investment. This is also reflected in the price forecasts that many analysts and experts estimate to be high for the coming years. This makes RSR a potentially good investment.
Please note that investing in cryptocurrencies involves high risks. You can also lose your entire deposit. It is often wise to enter the market at different times: that way you avoid investing all your money in this cryptocurrency at the top.
Market cap and supply of Reserve Rights
Reserve Rights has a fixed supply of 100 billion tokens. Less than 10% of these are currently in circulation. The maximum token supply is predetermined, but a large proportion of the tokens are locked up for various reasons.
The Reserve Rights token was initially launched with a circulating supply of 6.85 billion tokens, of which 3% was distributed to Huobi Prime IEO participants, 2.85% released as project tokens and 1% to private investors. All team, adviser, partner and seed investor tokens will remain locked until the main net is launched.
55.75% of the supply is locked up in a smart contract known as the ‘slow wallet’. The money from this wallet is released after a one-month delay with a public on-chain message from the Reserve team explaining the purpose of the withdrawal.
When was Reserve Rights established?
Reserve Rights was founded in 2017 by Nevin Freeman, Matt Elder and Miguel Morel. The company is headquartered in Oakland, California. Since then, the team has grown to more than 10 members. Miguel Morel used to be in charge of operational strategies, but he is no longer listed on Reserve’s website. Rumour has it that he is founding a new start-up.
What is the current Reserve Rights team?
The Reserve Rights team currently has 18 members and advisers. Not all members are listed on the website, as they wish to remain anonymous due to their whereabouts or to protect their identity. These are the main team members:
Nevin Freeman (co-founder and CEO):
Freeman is one of the founders of Reserve and is the CEO of the project. He is responsible for strategy, legal affairs and team coordination. Prior to founding Reserve, he co-founded Paradigm Academy, Metamed and RIABiz, among others. Freeman is keen to solve the problems that prevent humanity from reaching its potential, and he is particularly concerned about averting the long-term risks associated with the development of artificial intelligence.
Matt Elder (co-founder and CTO):
Elder is also one of the founders of Reserve and its Chief Technology Officer. He is responsible for the development of the protocol and the architect behind the implementation. Before founding Reserve, he was an engineer at Alphabet, IBM and Quixey, among others.
Charlie Smith (Business development):
Smith is responsible for tactics and partnerships at Reserve. He previously worked as a management consultant at ReD Associates and helped start a bitcoin mine in Texas.
Cathleen Kilgallen (CFO and Compliance Officer):
Kilgallen is responsible for Reserve’s finances and ensures the team’s compliance. Prior to Reserve, she was COO at Leverage Research and Paradigm Academy, and has worked for The Jane Goodall Institute and Amnesty International, among others.
The team also includes Jesper Ostman and Taylor Brent for Protocol Development, Mark Lee for Legal and Erika Campbell for Onsite Operations.
Want to learn more about Reserve and the Reserve Rights token? Visit the website of this crypto currency.
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