Bitcoin Forum

I received 4 BTC IOUs issued by TradeFortress (rH3bZsvVUhzugvcYuJVoSYCEMHkfK6wHNv) recently.

I'm not sure if TradeFortress is going to repay it though. Probably not, because it was his "social experiment" to reveal the Ripple's disadvantages over bitcoin, and for some reason his topic got deleted.

What I'd like to do is to continue his experiment and to try to sell his debt via this auction.

If you win the auction, you will need to send real btc to address I assign to you, then grant trust to TradeFortress (rH3bZsvVUhzugvcYuJVoSYCEMHkfK6wHNv) and give me your Ripple address.

Minimum quantity: 1 TradeFortress BTC
Starting price: 0.01 BTC per 1 TradeFortress BTC
Minimum bid: 0.01 BTC

And here is the countdown timer:

Timer removed. End time: 2013-05-18+00:00:00UTC

Has he stated anywhere that he even will honor this debt?
Have you received anything in return for these 4 IOUs? Generally anyone can issue arbitrary IOUs in ripple, as long as there is not even some intent by him to pay it back, you just got something equivalent to a piece of toilet paper that reads "this is worth 4 bitcoins from tradefortress".

Also why do you want to settle outside of ripple?

Frankly speaking I don't remember the exact wording as his original post disappeared :( But he is a hero member, so probably he deserves some trust. IOU means "I owe you". It was issued by him, and probably he doesn't want to get a scammer tag. So theoretically there is a chance to get the money if you chase him. If you think this chance is higher than 1%, then you should participate in the auction :)

I want to settle it outside the Ripple to get some attention to my offer. And also I don't want to have simultaneous trust to him and to some other BTC issuer (I heard that Ripple can exchange IOUs of people you trust automatically, without your consent... not sure if it is true though).

Oh, wow.. His giveaway topic is visible to me, here it is:

https://bitcointalk.org/index.php?topic=206948.0

And how do you plan to transfer this 4 BTC? Send me the 4 BTC via Ripple?

This will just mean that I have an IOU of 4 BTC from you. Now would you honour it?

That you can't actually get the 4 BTC was the point to show with this giveaway.

Yes, I would send 4 BTC to you. If I understand how it works correctly, then you don't need to trust me. You need to trust him.

I meant his BTC IOUs via Ripple of course.

As long as he doesn't set up a path to some node that actually will pay out e.g. BitStamp there is probably no way to get these IOUs and they are essentially worthless.

Generally in Ripple:
If you don't trust somebody, don't trust somebody. You can and will loose money that way.
Whoever put any trust at 100 BTC to TradeFortress in that thread is going to have a VERY bad time!

Do I understand it correctly, that it is risky to trust TradeFortress only if you have BTC IOUs from other issuers?

I guess I will start the bidding:

0.04 btc for 4 TradeFortressBTC on Ripple

It is risky to trust anyone for BTC as soon as you trust TradeFortress. It is very likely that any other BTC IOU will be sucked from you as soon as possible if you keep a trust line to him - as you see people are already desperate enough to sell them for just 1% of what they are worth on paper (in reality they are probably worth 0).

I'll cover your 0.04, but this is a bad idea because the point is to show a BTC in ripple isn't a BTC

0.05BTC for the 4 IOUs

0.0501 btc

I know it is not a real btc, that is why they are so cheap

I know that too.

0.050101

0.0502

this is the first time that i'm witnessing people actually bidding up how much money they are going to lose.
i'm confused.

I fold.

Oh, wow... Guys, thanks for bidding!

That's my first auction here, I am learning how it works. I saw in other topics that people usually bid <amount> @ <price> and topic starter posts the auction state, so here it is:

user	quantity @ BTC	remainder
Peter Lambert	4 @ 0.01255	0 remaining

Yeah, I guess my last post was a bit ambiguous, since it could technically be read either as you put it (which is what I meant), or as that price for each.

Just to be clear, my last bid was 4 @ 0.01255

Maybe next time you do an auction it would be a good idea to set a minimum step size.

Yes, thanks! In fact I wanted to set it, but confused the wording (you can see min bid and start price in original post, which is the same... I meant min increment, not min bid... my mistake)

If you really want it, I'll send you some Ripple IOUs for free.

As his goal clearly is to spread FUD and damage ripple's reputation, I would not trust him on this, even if he's a hero member, and I don't think any sane person should trust him either.
He is most likely not willing to pay his IOUs, probably claiming that it's obvious that they are worthless since they are in ripple so nobody should expect him to pay anything.
Whoever accepted his offer just shows his own inability or unwillingness to understand the concept of IOUs and deal with them responsibly.
There are quite a number of gullible folks in the Bitcoin community...

Onkel Paul

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Good luck in enforcing anything from this debt...

https://bitcointalk.org/index.php?topic=207841.0

Ships me some r3v4r7Darb2J5o7whULpMXuDQ9CpctBd7L
I honestly can't even figure out how this scam is supposed to work.. Seems convoluted and strange..

How then can ripple possibly not be a scam if it is a debt system that rests on service trust? Hey everyone, I'm selling a napkin that says "5 btc" IF you can find someone to pay 5 btc for it, I guess the system works! Wtf

I have a question for ya guys has anyone tried withdrawing these btc to bitstamp yet? I have and it only worked once but not after that? it just says no path found

1) Create tons of worthless IOUs but use a common name for these (e.g. "BTC", "USD"...).
2) Get people to extend trust to you (="giveaway thread").
3) As soon as one of these people also has a trust line established with a "good" source of these IOUs (e.g. Bitstamp) and has some balance there, they can and ina  few cases already did end up with the worthless IOUs instead.

2) is the problem where people are messing up, 3) is something that many are not aware of and that I too consider a flaw in the Ripple system (trusting 2 BTC gateways implicitly means that I value each to the same extent).

You cannot withdraw these TradeFortressBTC to Bitstamp, you can only withdraw BitStampBTC to BitStamp. I feel like I have already told you this in a couple other threads, why do you keep asking the same question?

So why did it work yesterday?

Are these the famous TradeFortress bitcoins from the great '2013 Ripple scandal'?

I bid 0.06btc just to own a little piece of history.

Yes, thank you :)

So you bet 4 @ 0.015 , right?

ill sell 6 Tradefortress IOU 4btc for 6btc

correct (that's about $6 right? - I'm worried I'm losing track of the decimal places)

That's what you get when you extend trust to someone you shouldn't trust. (There are maybe other areas where TradeFortress can be trusted, I just don't know him well enough. He can't be trusted regarding anything related to ripple, though).

Let me tell you something that really happened to me a long time ago:
When I walked to my car, a guy walked up to me and told me he had lost his wallet, needed a few bucks for a train ticket so he could get home - he would pay me back immediately via bank transfer. He looked like he was sincere and really in need of help, gave me his name and address and he signed a piece of paper that he owed me that money. I was young and naive, so I gave him some money. Of course I never got it back - I was stupid, and he was just a scammer.

Now this is what happened to you:
TradeFortress walked up to you, promising you he would give you 1 Bitcoin (via a ripple IOU) if you trusted him for 100 Bitcoins. You are young and naive, you don't understand how ripple works, and you believed that a promise from TradeFortress is worth real money, so you trusted him.
Now you find that the "piece of paper" where he promised you 1 BTC isn't even usable to wipe your arse since it's just virtual.
You believed that he would keep his promise to give you 1 BTC (in return for the IOU) and now you find out that he never intended to do that.

He calls it a social experiment. I see a very clear parallel to my case where I've been scammed. Who is the scammer here - the paper on which he promised to pay you 1 BTC (which is an analogy of the ripple system and theh IOU expressed in it), or the guy who promised it to you knowing perfectly well that he will not pay?

And just in case you still don't know what the real scam is here: it's not his empty promise of 1 BTC (everybody could promise me 1 BTC - if they don't pay I haven't lost anything) but his tricking you into trusting him for 100 BTC. In the ripple system, this means that up to an amount of 100 BTC you accept "his" worthless BTC IOUs as substitutes for BTC IOUs from actual trustworthy gateways.
If you don't trust a gateway to pay out the BTC they owe you, you definitely should not do business with them, whether in ripple not in the "real world". So now you should immediately reduce the trust level for TradeFortress in ripple to zero and hope that there hasn't been too much BTC rippled through your account - that amount would definitely be gone.

Note that there are valid criticisms regarding to ripple, such as it being based on IOU instead of irrevocable value transfer such as Bitcoin, or the discrepancy between the bold words of openness on their web page and the closed-source server code. These points have been discussed to death, but TradeFortress seems to have chosen to not accept the answers and claims that his questions have not been answered.

Onkel Paul

I'm either missing something or you're all brute stupid.

Why are you bidding on something that even TradeFortress (The one who is supposed to honor the IOU) implied that he wasn't going to be doing so?

I don't know much about Ripple, so feel free to tear this post to bits.

This is indeed economically unreasonable. The people doing it probably want to have a "collector's item".
Like old post stamps, which are unusable for their original purpose since the postal organization that emitted them does not exist anymore, but will be sold and bought anyway.

Onkel Paul

Some might believe there is a chance that TradeFortress will pay to improve his reputation, others might do it for fun or as (stated above) to own a little piece of history :)


Yes, that's right. Thanks for bidding! So current winners are:

user	quantity @ BTC	remainder
dancupid	4 @ 0.015	0 remaining

Here, let me explain it clearly:

If I buy a TradeFortressBTC, then it sits in my account. But there are a bunch of other people who trust TradeFortress, so if any of them hold BitStampBTC, I can send 1 BTC to BitStamp and the other guy gets his BitStampBTC switched out for TradeFortressBTC, and Bitstamp credits my account 1 BTC. So there is a chance I will be able to get 1 BTC from this TradeFortressBTC, but there is also a chance that everybody removes their trust from TradeFortress and so it becomes worthless.

Exactly. The ones removing their trust last are the Bagholders (http://en.wikipedia.org/wiki/Bagholder).

Onkel Paul

Auction is over.

Congratulations to dancupid!

Please sent 0.06 btc to 1GRNJqxh4SGu3ubNGagsFfEUub8uc8HC7m and give me your Ripple address so that I could send 4 TradeFortress BTCs to you.

Thanks for participating!

You will also have to trust arsenische for 4 BTC (or trust me directly for 4 BTC) for you to be able to receive it, FYI.

Yes, as stated in the original post, trust to TradeFortress (https://bitcointalk.org/index.php?topic=207054.0) is required.

Well I'll beat the dead horse I know that it won't rebate but will participate for history
4 @0.016 :)

Bitcoins sent:

https://blockchain.info/address/1GRNJqxh4SGu3ubNGagsFfEUub8uc8HC7m

My ripple address is rGJTUufiL6cD5j3HeHA7r74VMeyCofpUQq

Thanks.

Haha that was a fast expirement mean :) lol nice rofl  ;D

IOUs sent, Transaction # BCD03C649D5E5AD1A2992E18A44FD162788E627537A104F50DD0A3E7331B5A7E

Thanks!


I am sorry, you missed your chance, Auction had been over before you made a bet.

No worries was just playing around with the idea :)

Correct, but there's a much bigger danger, as you describe below:


This automatic rippling is the real danger. Any time TF makes a BTC payment in Ripple, the Ripple system can take any BTC IOUs issues by presumably honest and reliable gateways like Bitstamp, pay them to the recipient and give you worthless TF issued BTC IOUs in return. By granting him trust you are promising to make payments on his behalf and to trust he will pay you back. You will then be on the hook for some of his debt. In return he has to pay you back, so theoretically it evens out, but that is cold comfort if he defaults on his obligations.

Trust means real world trust, not cyberspace pretend trust.

Bear in mind that Bitstamp also needs to earn its trust. I wouldn't be comfortable with trusting them with anything else than small amounts for short periods of time. For me that's something like $100 for a couple of hours max.

Correct, but there's a much bigger danger, as you describe below:


This automatic rippling is the real danger. Any time TF makes a BTC payment in Ripple, the Ripple system can take any BTC IOUs issues by presumably honest and reliable gateways like Bitstamp, pay them to the recipient and give you worthless TF issued BTC IOUs in return. By granting him trust you are promising to make payments on his behalf and to trust he will pay you back. You will then be on the hook for some of his debt. In return he has to pay you back, so theoretically it evens out, but that is cold comfort if he defaults on his obligations.

Trust means real world trust, not cyberspace pretend trust. Everyone needs to revoke any trust lines they have with TF immediately or be at risk of losing lots of BTC and owing them to others.

Bear in mind that Bitstamp also needs to earn its trust. I wouldn't be comfortable with trusting them with anything else than small amounts for short periods of time. For me that's something like $100 for a couple of hours max.
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Sorry about the double posts people, I was trying to edit and must have pressed the wrong button. I can't edit or delete the messages now.

Yes, looks like in Auctions section all posts are read only.

Makes sense, if you think about it. Anyway, bottom line: revoke those trust lines NOW.

Correction: It is not just that when I make a BTC payment in Ripple (I will not do that, I'm not here to scam people), but when anyone with my IOUs makes a payment. In every single case where other people have exchanged their bitstamp/etc IOUs for my IOUs because of the Ripple system, someone else had.

Also:

Let's say Bitstamp IOUs can be redeemed pretty much instantly nearly all the time. However, your friend's IOUs can only be redeemed when he is online, and he just went on a holiday for 3 weeks. Ripple may automatically exchange your Bitstamp IOUs for your friend's IOUs. Good luck getting your BTCs out from your friend right now.

http://ripplescam.org/

please check out how TF scammed me and vote on him being a scammer: https://bitcointalk.org/index.php?topic=151880.0;all