Bitcoin Forum

Ripple is a payment Network, But Bitcoin is a currency. Ripple is older than Bitcoin. it was originally just a payment network and distributed exchange. Bitcoin Launched 3 January 2009 and Ripple Protocol originally launched in 2004. Currency launched in February 2013. Ripple is a way to exchange anything of value. but bitcoin not a payment protocol and can’t exchange anything of value.

Ripple basically means everyone can issue her/his own altcoin.

Bitcoin is an asset ledger.

Ripple is a liability accounting system.

This is basically correct, but it should be noted that there is an "old Ripple" which existed before Bitcoin, and the "new Ripple" which came after bitcoin.
The "rippling" approach behind old and new Ripple is very similar, but I think the implementation is considerably different. In particular, the new Ripple is trying to be decentralized and uses a consensus algorithm for the ledger (I think the old Ripple used a centralized ledger) so that it does not depend on trust in a single organization.

Onkel Paul

The possibility of issuing one's own "altcoin" (which isn't really a coin) in ripple is undeniably there, users need to be aware that just because someone offers them some shiny IOUs they should most likely not accept them unless they trust the issuer to actually redeem real coins/dollars/goods for the IOUs.

Bitcoin is a closed asset ledger and payment network, supporting Bitcoin.

Ripple is an open asset ledger, payment network, distributed exchange, and liability accounting system---that supports XRP as well as any other currency issued on the network. It is designed to support transactions that cross between currencies. Ripple also prominently supports Bitcoin.

XRP, like Bitcoins, have no counterparty risk. They can be used in absence of trust relationship. IOU, meanwhile, may be issued by anyone and are are worth their exchange value. IOU are secured by trust relationships. Security boundaries form an IOU trust network. They are user-controlled and known as 'trust lines'.

External currencies are the focus of Ripple, in the form of IOU. Above and beyond being an asset ledger, it is a cross currency payment and exchange protocol and network. Using the built-in exchanges and trust pathways, Ripple is able to support near real-time cross currency payments. Users have no need to directly trust each other, in most common use cases. Everything occurs at the best available exchange rate. XRP exists ubiquitously, in part, to simplify pathfinding between currencies for conversion.

Ripple is also designed for external usage. Via the Federation Protocol transactions can silently pass through Ripple---as part of a background payment process. A simple use case would be setting up a payment service that accepts DOGE from the DOGE network and then pays with Bitcoin at any Bitcoin address. Ripple can send Bitcoin out from its own network via the Bitcoin Bridge. Neither buyer nor seller need to concern themselves with the inner workings of Ripple. Ripple is designed so that users can stick with the currencies they are comfortable with, from within those networks---with Ripple merely acting as a bridge between them. No absolute need for end-users to hold IOUs exists. No need for end-users to even hold a Ripple wallet exists.

Use your favorite alt at Overstock.com? Ripple enables exactly those types of cross-currency transactions.

Ripple, as it grows, has potential to become a viable means for Bitcoin to be used to make purchases from any merchant---whether they accept USD, EUR, CNY, JPY, or any other currency.

An attack campaign has given the community an inaccurate and distorted view of Ripple. A shift in perception is beginning, as new users become attracted to cryptocurrencies, and veterans wake up to having been hoodwinked (https://bitcointalk.org/index.php?topic=212730.0) by the likes of Tradefortress (https://www.google.com/search?q=tradefortress+scam) and crew.

Ripple for Bitcoiners (https://ripple.com/wiki/Introduction_to_Ripple_for_Bitcoiners)

^This

Blaming other people, is a lazy interpretation of a failure to communicate whatever Ripple's real value is.

I'm quite neutral but Ripple seems like a damp squid coupled with a bad launch of XRP that's near infinite in number and the few that have found value then suggest a market cap of $ 1,451,152,125 <- really?.. I don't see it and I'm trying to see it, what does that suggest for how poor their product and/or ability to communicate that. Perhaps I am missing real useability development and it'll suddenly be in our faces as the obvious contender but perhaps it just needs a relaunch.

The problem is they can't be honest about what Ripple is and still get as much buzz as they currently enjoy.

Right now they, and all the other projects which advertise user-created currencies (Mastercoin, Ethereum, Open-Transactions), are benefiting from this reaction: "Create my own currency? I'm gonna be rich!"

This is deeply irresponsible.

What they should call them is "user-created loans". This is far more accurate, but if they started using that terminology then all of a sudden everyone would remember that loans eventually need to be repaid and that doesn't look nearly as attractive. It's not that liability accounting isn't useful - it is - but it's not sexy and isn't going to make anyone insanely wealthy.

Bitcoin showed us that currencies do not need to be somebody's liability. Currency has been that for so long that it's no surprise that most people don't see the difference, but now that such a demonstration has been made it's dishonest to use the same word to describe tokens which describe liabilities and tokens which are assets.

Anything with counterparty risk attached to it is not a currency. Call it something else: debt, liabilities, loans, IOUs - just don't call it a currency.

The problem with Ripple as I've said before is there could be 100 Trillion ripples with the creators having 99%.

The creators can gradually cash out their Ripple wealth drastically devaluing the ripples normal users have. That's in stark contrast to Bitcoin which is why users are so passionate about it. Bitcoin users know there will never be any inflation the market hasn't already priced in. Every single Bitcoin in existence can be verified.

Ripple is more akin to non-transparent central bank fiat. I'm wondering why there even needs to be ripple currency. That's not how Ripple started out. Ripple started as a simple ledger to track IOUs between parties. After Bitcoin/cryptocurrency entered the scene, suddenly ripple then added a currency too, but which can't be verified unlike cryptocurrencies.

The excuse given for requiring ripples is to "prevent network spam" but that's BS. As is pointed out, ripple doesn't use a block chain or  mining, so data storage pressures don't exist.

A Ripple-like system can be implemented as Ripple was first intended, which would be better. That's simply to have a distributed consensus ledger about who owes whom what. These are only IOUs in the first place, so there is no underlying currency in addition needed.

I can't see that ripple even count.
Its pre mined and it is not decentralized.
In other worlds, it was too late to get it right from the get go.

Because of this, ripple along with other inflationary coins compete with the dollar, not with bitcoin

I see value in community members informing the broader Bitcoin community of organized attempts to mislead it, whether it be the history of Ripple detractors or MtGox.

I am not defending the communication quality of Ripple Labs. For the most part, it is the Ripple community that is educating new users and attempting outreach. Ripple Labs is not pursuing mass adoption, and have lagged in effectively communicating the strengths of Ripple. They are focused on protocol integrity, attracting developers, and supporting early adopters. Marketing is not a focus. I wish Ripple Labs did more, and recent hires suggest they will be putting greater focus on outreach.

Here is a great interview with Ripple CEO Chris Larsen (http://www.moneyandtech.com/chris-larsen-ripple/). Ripple Labs is transparent about Ripple, their strategy, and vision. Individuals may disagree, after understanding Ripple, but most are misled into following a link to the attack site of Tradefortress and proceed to shut down. A great irony is that Ripple has potential to help Bitcoin reach even further.


99,999,999,999 XRP existed at launch. Reserve requirements, ledger costs, and anti-spam utilization make it an integral component of the network. XRP is not the core utility of Ripple. A lot of cryptocurrency community members miss that. External currencies are the focus of the protocol.

58,987,150,405 DOGE currently exist. Relative to Bitcoin, each seems a large number, but an effective amount of currency has yet to be established. Bitcoin is the standard that alternatives are compared against, and we have yet to see what an effective number.


It depends on how you calculate the value of the market cap. I do not consider it especially relevant. Ripple is weak in liquidity and adoption; my emphasis is the underlying untapped utility of the system. I am not trying to sell people on investing in XRP. It is simply a useful system, with ability to benefit external currencies and other cryptos.


I agree, in general, about the weak launch. Again, I consider market liquidity, services, and developer adoption more significant than XRP value. Basically, Ripple Labs emerged from stealth mode too early---and exposed Ripple to an attack campaign that they were not ready to handle. Ripple Labs is starting to gear up to improve communication, but it will take time.

Prove it's only that.


That's provable.

Everything is in the ledger, just like the blockchain.

I think a lot has do with people simply not understanding monetary systems, payment networks, distributed exchanges, currency exchange and pretty much everything hypostatization just laid out.  Most people's extent of knowledge on these subjects is limited to what they learned from Bitcoin and thus, they can't see anything but "coins" because everything else is beyond their current knowledge base. Understanding "coins" is simple enough for even children to understand.  

The simplest way to understand the benefits of Ripple to Bitcoin, is to just look at Gox.  If Gox had been plugged into Ripple, users would had flexibility over their Gox IOU's. While an exchange closing is never going to have positive results, those IOU's could have still been moved into other currencies, like Bitstamp.BTC or XRP and then moved into any other currency where liquidity exists. This is much like what Bitcoinbuilder did, except you don't need a central clearing house to move your IOU's.  Instead, Gox users have taken a total lost because they prefer centralized exchanges over distributed exchanges.  Why?  IDK...maybe a few more need to fail before people finally get it.

Now no ones perfect and RL's is no exception.  Things can always be improved upon and the necessity to effectively communicate Ripple's feature set and benefits, should remain an on going process. But keeping blinders on and refusing personal responsibility to understand the tech in the space, is also not an excuse for not educating ones self on the tech, that brings increased value and utility to Bitcoin and all crypto-currencies.  

Ripple can bring the entire digital currency space to worldwide ubiquity and that's just a fact.

I've already went through this with another Ripple supporter here (https://bitcointalk.org/index.php?topic=497609.msg5475702#msg5475702):

Ripple is not mined. XRP vs. Bitcoin is where a lot of people get lost. I am not selling XRP as an investment; instead, I am trying to clear up misconceptions about the protocol and network. It has massive potential to benefit all cryptos. Its emphasis is on transacting external currencies. Ripple Labs is explicit about their intentions; they are using XRP to attract partners (for increased liquidity), funding operations, and supporting humanitarian projects. Check out the interview linked above.

Creating services for the Ripple network, that can profit from any currency, is the best option for making money through Ripple.

XRP can be earned in exchange for contributing to the World Community Grid (https://www.computingforgood.org/), but this most likely only attractive to existing contributors or those with access to free computing power. I can buy XRP directly at a lower cost than spinning up VMs to mine with.

TBH it looks to me the reason XRP exists is to exploit the attention and value given to cryptocurrency, coupled with promises of exchange of external currencies.

The first question I have is why is an XRP currency unit needed in order to keep the ledger of IOUs? That's not how Ripple started...

Second, if you say XRP currency was created to raise money I don't have a problem with that, but it should then be done as an alt-coin, the cryptographic model people are familiar with and respect because they know there are no shenanigans for the market. Everything is independently verifiable.

Integrity of the total XRP count is equivalent to the integrity of the ledger, like the blockchain. Validation is performed by few parties today, and that is legit ongoing grounds for criticism. As the network grows, that will become less of a concern. Harming the integrity of the ledger is not in the interest of current Validators or Ripple Labs, as it damages the network. You can learn more about the Validator consensus process here (https://ripple.com/wiki/Consensus).

You mean because there will be so many suckers at that point the vested interests in Ripple can cash out quite easily?

I agree there would be less concern, for the creators...

It's used to prevent spam in the ledger and provide ease of currency exchange.  For example:  BTC -> XRP -> Yen  or USD -> XRP -> Frequent Flyer miles  Whatever!  Anything of value.


XRP is a math-based currency just like any other.  Why would it need to be a copy of the Bitcoin source to be legit?  Here's a tip to understanding Ripple...FUCK XRP!!  Once you understand that, the world of possibilities that exist with Ripple open up and you see, as was mentioned, that "copycats" have done little more than repackage Ripple features and look to sell IPO's based on the negative sentiment of the community. The difference is....Ripple works.  XRP was not created to be a speculative commodity so when people stop looking at Ripple based on BS market caps and start looking at the utility it can provide, the whole space will benefit.

XRP are functional component of Ripple. I gave some details above. Pathfinding is essential for cross-currency payment. Liquidity only need exist between XRP and each external currency. Having a cost associated with ledger entries helps prevent ledger flooding attacks, as well as the small portion of XRP destroyed in every transaction.


Ripple not having mining was an intentional design decision, to increase computing efficiency and network speed.

I recommend watching the interview with Chris Larsen linked earlier in the thread. He is candid about the targeted utility of the network and immediate business plans.

I addressed this above. There is no spam concern because there is no distributed block chain with data storage and bandwidth pressures.


I didn't say it did. I said it needs to be mathematically verifiable. Show me how it is and I'll shut up immediately.


You mean only pay attention to the great sounding aspects like external, simple currency exchange, but not to what the "right hand" is doing behind the back with XRP...

Here's the difference:

Ripple sucks.

Bitcoin rules.

/thread.

No, I mean that additional Validators will come online, helping to ensure ledger integrity.

Also: Ripple Labs will make far more money from the success of Ripple.

My take:

Bitcoin rules.

Ripple rules.

They focus on solving different sets of problems.

So Ripple's ledger integrity is to be validated at a later time, just not now. Mmhmm.

There is spam concern because there are transactional limits to everything.  If there is no spam prevention, anyone can attack the network with say 100,000 false transactions and grind the network to a halt or at least significantly slow the process of transactions.



I'll have to let one of the "math guys" deal with that.  Maybe JoelKatz is around.  



Why do you care what's going on with XRP?  How does that affect yours or anyones ability to utilize the network.  If you don't like XRP, don't use it.  Ripple is currency agnostic.  For people that only want to deal in BTC payments from here till infinity, Ripple will likely have no benefit.  For everyone else, there is tremendous value and when you start talking about hosted wallets, most people on the planet won't even know XRP exists.  So I fail to see how any of this is relevant.

Already expressed the small number of Validators as a legit criticism (https://bitcointalk.org/index.php?topic=510868.msg5644041#msg5644041). Ledger integrity is only as trustworthy as the Validators on the network. I think Ripple is great, but also understand why that would turn people away today. Not trying to hide anything here. Ripple Labs needs to attract more Validators.

Edit: you may appreciate this explanation of consensus (https://www.youtube.com/watch?v=pj1QVb1vlC0)

Okay, then use a cryptocurrency to prevent spam. In fact, you could use Bitcoin. The way to prevent spam is simple, which is attach a cost to an electronic action. Spammers are successful only when their cost to spam is negligible.


I'm not sure you understand. Don't you know if there was a hole discovered in Bitcoin which allowed the 21 million to be increased without network consensus it would shake our community to its roots? Possibly even destroy it if it couldn't be patched?

The market is supposed to verify the goods they are being sold are as claimed. The better question is why do you and others seem to suggest we shouldn't care what's going on with XRP?

The original Ripple was brilliant IMO. I was a fan. That did what the current Ripple does and without any underlying currency. The function Ripple purports to solve is real and is a need. I would love for it to be solved. It's unfortunate that instead of focusing on that there seems to be elements of greed and non-transparency seeping in. That sucks.

Last ledger is the product of a distributed consensus between validators.
Validators will accept a ledger N if and only if there exists a valid transition from previously validated ledger N-1. A valid transition between two ledgers is a set of transactions that are legal as defined by the Ripple protocol. There is no legal transaction in the Ripple protocol that allows to create XRPs, and XRPs can only be moved between accounts or destroyed as transaction fees.
Therefore, a valid transition between two ledgers can only maintain the number of XRPs in circulation or reduce it, and from that property, it derives that the only XRP that can ever be created need to be created in Ledger 0 (or genesis ledger).

They did, it's called ripples or XRP.


Even if this happened, it would have negligible impact on the network because XRP is not a speculative currency.  It would certainly affect the value of XRP but XRP values do not determine the success or failure of the network.  


That's your personal opinion.  I don't share that view and have no issues with RL's turning a profit off XRP, should it's value rise one day.  The reason people shouldn't care about XRP is it's not a speculative currency and it doesn't affect ones ability to utilize the network.  It has a very specific function and I know for those that only know "bitcoins" that it's hard to understand anything else.  Ripple is payment network first....XRP second.  The reverse is true for Bitcoin and that's why people get hung up on XRP.  

Okay, if you say so... but what about this:


Why is there this mysterious missing genesis ledger? In Bitcoin the creator disappeared, but it's no matter because we have and can verify the genesis block. With Ripple it's backwards, we have the creators but the verifiable origin of Ripple amount is a secret.

XRP is a crypto-currency.
Using any other crypto currency for that purpose would require Ripple to juggle with multiple chains, would increase significantly the load on that chain, create a dependency between Ripple and a currency that may not necessarily be future-proof due to the high energy cost of proof-of-work mining, and serve no purpose since Ripple already has a very efficient distributed ledger where it can handle it's own native math-based currency.
Among all crypto-currencies, Bitcoin is probably the worse fit as fees are orders of magnitude higher than current transaction costs in Ripple, and scalability is very limited.

If the original Ripple didn't need an underlying currency, Ripple Labs's product wouldn't be called "Ripple" today.

Validation is handled via consensus (https://www.youtube.com/watch?v=pj1QVb1vlC0). Consensus would be required for any ledger changes that modified the amount of XRP. It does not work like Bitcoin.

Modifying the ledger to alter the total number of XRP or their distribution requires Validator consensus.

If you do not believe in the value of the consensus process, then Ripple is not for you. Validation is a current weak point---given the small number of active and widely trusted Validators---and another possible reason why Ripple may not be ready for you. I do, however, personally believe in the fundamentals of the consensus system.

It's apparently not a verifiable one.


How so? Simply attach a transaction fee payable in Bitcoin (or something else).


Cryptocurrencies are made to transact value, so using them for transactions isn't Ripple's problem. Let's say that Ripple was truly concerned about that though. Then why not create Ripples own crytpcurrency alt-coin, and with a verifiable block chain. If there are arguments to using a block chain, and it's preferred to do it the way they have with a "genesis ledger" then okay, why not do that and give it the same level of mathematical check availability?


I'm not sure what it has to do with anything, but that's not my recollection. I visited Ripple's site before Bitcoin became big, I'm pretty sure it was before I heard of Bitcoin and I've been around since very early. At that time "ripple" was about connections between people - friends and friends of friends - using those relationships to be able to transact value in the form of IOUs, for anything, like dollars. I thought that was a very cool model, but there was no "XRP" or mention of cryptocurrency in existence at that time. There didn't need to be, because it was all about social network relationships.

Check out the interview. It will help you understand Ripple and XRP better than a forum flame war :)

but you are trying to defend Ripple and partial in presenting that. There's value in a balanced; rounded; and not partial, presentation of problems.


Again, you're trying to make excuses.


My impression is that whatever Ripple might be, is not related to cryptocurrency as currency. Significantly then, it seem that XRP are not meant to ever be valuable in and of themselves. If all Ripple'n'Co. did was make that clear, it would avoid the naive user spending money on those XRP. Leaving people open to make mistakes whether by neglect or deliberate ambiguity, is essentially exploitation and should not be encouraged.

If XRP are meant to hold value, then what we know of the spread of them looks very suspect; if XRP are not meant to hold any value and they are to be given away to oil the machines of whoever wants to host a server, then that has not been made clear. Either way, Ripple support sucks at communicating what is intended, relative to other Bitcoin2.0 protocols who are doing that better and more openly. Consequently, all I've seen of Ripple, is pushing people away - people who by rights should be the most enthusiastic of all.


*Give me a load of Ripple, maybe I'll like it more.. but why would you do that, if they are valuable? rJ2zDmzhxQNspB6RsxKgp8Ro1odEsACCEx

Of course they are meant to hold value. XRP is currently second to Bitcoin in market cap apparently at around $1.5 billion: http://coinmarketcap.com/

Surely you're just falling into that simple illusion they've setup?

If I create 99,999,996,303 of my own coin and sell only 10 of them for $10 each, do I have a market cap of $999,999,963,030? I know economics is absurd at times but surely that's just a bad joke.

How does the Ripple client pay the transaction fee if it is offline from Bitcoin? If your answer is offline transaction, then how does the Ripple client knows what Bitcoin transaction outputs to use to pay the fee? And who will push the new fee transaction online? The rippled server? Then it needs to be a Bitcoin client as well.
Then comes validators: how validators know that the output of the attached Bitcoin transaction have not already been spent if they are not themselves Bitcoin client receiving the Bitcoin blockchain?

It helps your case when you remove my quote from context (https://bitcointalk.org/index.php?topic=510868.msg5643679#msg5643679). I went on to say that the community, and not Ripple Labs, is driving most of the communication---as well as stating that Ripple Labs has lagged in effective communication. Ripple Labs can definitely be doing a better job; I am also optimistic that they are heading in that direction.

I have also been transparent about issues with the Validator network today, at multiple points, as well as WCG not being cost effective for most people.


I am not sure what excuse you think I am making? I am even stating general agreement. Ripple Labs did not effectively respond to the attack campaign. It was a clear misstep, in retrospect. I am also stating the launch was weak. In saying that they are starting to gear up to improve communication, I am also acknowledging that they are not where they need to be today.


You will have a better understanding of Ripple, Ripple Labs, and XRP after watching this interview with Ripple Labs CEO Chris Larsen (http://www.moneyandtech.com/chris-larsen-ripple/). Ripple Labs is direct about the technology and future plans.

For the better part of last year, members of RL's repeatedly stated (in these forums and across the web) that XRP was a risky investment and is not intended as a speculative currency.  What people do beyond that is there choice.    


This has also been made clear that RL's intends to giveaway 55% of XRP to charities, gateways, market makers and other entities that can provide utility to the network. 25% goes to fund RL's operations in growing the network.  The other 20% is for the founders.

 Other "Bitcoin 2.0" protocols as you call them,  ;D are doing nothing but repackaging Ripple ideas and pushing vaporware to people who dislike Ripple but key difference is, Ripple actually works.  

I haven't seen Ripple pushing anyone away, in fact, it's been the other way around but at some point you have to stop banging your head against the wall and realize that some people just don't get it and there is nothing you can do to convince them.  Add to the fact that RL's is not currently on a general public/average user push.  That's not beneficial to the network at this stage of the game.  The focus is on the entities that will provide utility and in turn become trusted validators, as apposed to rounding up a bunch of amateur speculators, just to pump the internal currency. RL's is looking for stability in the currency and that requires volume based on utility, not speculation.  This makes cross-currency transactions much easier.

XRP may indeed be valuable one day but it's a long term, risky venture. That will depend on the utility of the network and whether people choose to move through XRP to facilitate transactions or will market makers just provide direct liquidity between currency pairs.  RL's founders are hoping for the former but not at the expense of the success of the network.  



XRP are currently in the $0.015 range. If you can't afford that, you don't need a handout, you need a job.   ;D  Less than 100XRP can sustain over 50 transaction per day, for the next 100 years.  So, you don't need much.   ;)

I've watched too many Ripple videos on the back of promise that they'll give "a better understanding of Ripple".. doesn't happen.



I've got BTC to spend but no reason to do so.. I'm thinking XRP are not meant to have value and that the intention is they should be given away for free. I don't want to burn good BTC or any other coin for XRP while the use of them is so unclear. If they are being given away, then I'm happy to consider them and trial what they can do but that's a different model of distribution than finding suckers to buy them.

They have been and are given away for free.  You must have missed their very first giveaway to members of this very forum.  They just aren't going to dump all the XRP to a handful of crypto-enthusiast because that does nothing to help fairly distribute the currency to the world and for Ripple, it's about the masses not the miners.  Eventually, this distribution will run its course and we won't have to talk about XRP all the time.  I'll honestly be glad when it's over because there is so much great about Ripple that people fail to see because of their "coin" blindness.

Yes, your edit above caught me on the hop: "Less than 100XRP can sustain over 50 transaction per day, for the next 100 years.  So, you don't need much.   Wink" which is news to me.

I've wasted enough time on looking into Ripple to do more just yet, unless it's made very obvious. I'll return later then to consider it again.

So you prefer contagion, bail outs and collusion when a large gateway/exchange goes down?
The incentives in Ripple push bail outs, debt and encourage other holders of Gox IOUs to turn a blind eye to Gox's trouble's, giving them more credit lest a default leads to loss of Gox IOU values throughout the system. This is what many critics of Ripple have said for years.

Bitcoin related businesses can never be too big to fail.
Ripple businesses can be too big to fail.

In your example, if MtGox was a gateway, ripple would have allowed trades of discounted MtGox.BTC for Bitstamp.BTC (or other currencies traded)? If the buyer of MtGox.BTC (who trusts Bitstamp.BTC) wanted to deposit their MtGox.BTC to MtGox , wouldn't they have to also trust MtGox? If this person trusts both MtGox.BTC and Bitstamp.BTC, doesn't Ripple consider their values to be equal?

It has been awhile since I deeply read into Ripple, so I may be mistaken.

This has nothing to do with bailouts or anything else. Not even sure where you got that from. This has to do with me having control over my IOU's.  Why should I let a central entity have control over my IOU's?  So they can halt withdrawals and leave me stuck?  I could have moved into XRP, probably at some kind of loss, but still could have then moved into Bitstamp.BTC from XRP.  I'd rather have that option than total loss.  


What's a Ripple business verses a Bitcoin business?  That makes no sense. ???  A Ripple gateway is the exact same thing as an exchange, I just have control over my IOU's and you don't.  In fact, you do realize Bitstamp is the largest Ripple gateway correct?  How do you reconcile your statement with that truth?

Ripple "allows" anything of value to be traded.  Ripple doesn't put value on things, you and I do.  In order to make a direct trade for Bitstamp.BTC, there would have to be liquidty or someone willing to accept them, at whatever the market deemed was a fair price.  If there was liquidity from Gox.btc to XRP, you could have also made this move and from XRP gone into any currency.



Again, Ripple doesn't put a value on anything.  You're saying (or whoever in your example) is saying they are equal. That's if you're talking about rippling through someone.  An option now exists in the client that defaults to "rippling off" and you have to actually enable rippling for that to occur automatically.

For direct trades...its similar to Bitcoinbuilder.  Some people have taken a risk on GoxBTC and maybe it will pay off, maybe it won't.  It would be the same in Ripple.  The IOU's will likely retain some value and if someone wants to buy them, they certainly can.  They assume that risk, just like the holders of Gox.BTC.  It's just with Ripple, you don't need a central entity like BitcoinBuilder to make these trades.  It all comes down to what you and I deem valuable and what you and I deem are fair prices to facilitate that trade.  Ripple just gives you and I a distributed exchange to conduct business, while eliminating the need for central clearing houses and centralized exchanges.

I've only heard bad things about Ripple..

This is a strawman.

Had MtGox been a Ripple gateway, it would still have failed all the same, except that until it did, its debt would have remained liquid and cryptographically provable. Liquidity of debt allows risk avert holders to sell the troubled asset at a discount to interested parties having different withdrawal options, willing to bet on a recovery or planning to take the legal route to recover the funds. Cryptographic provability of the balance guarantees that the exchange cannot cook his books and claim that he owes less than he really does.

... says an account created two weeks ago

Oh..I like how you worded that.  Very nice...ty.

So, In order for someone to know anything about Bitcoin/Cryptocurrencies, they have to have made an account on bitcointalk?
There are other forums and tons of other ways to gain information, grow up.

local Bitcoin wallet = you hold the thing.

Ripple = you hold a promise for the thing.

MtGox = you held a promise for the thing.   now you hold the bag.

Coinbase = you hold a promise for the thing.

SilkRoad Wallet = you held a promise for the thing.   now you hold the bag.

Bitcoin Savings and Trust = you held a promise for the thing.  now you hold the bag.

MyBitcoin = you held a promise for the thing.   now you hold the bag.

Bitfloor = you held a promise for the thing.   now you hold the bag.

Cryptsy = you hold a promise for the thing.


Notice any pattern?  anything that stands out as different from the others?

I know which option I'm sticking with.

I notice a pattern and it's one not based in total fact so, let's fix this shall we:

Bitcoin wallet = You hold bitcoin and it's the only thing you can hold.

Ripple wallet = You hold ripples and can also hold IOU's for anything of value.

I know which option I'm sticking with...both!

Continuing to paint Bitcoin and Ripple as competitors, only does a disservice to the entire community.  

If you are a miner who got all the coins directly, never buys BTC for fiat, never sells BTC for fiat, and hodl, then indeed you better stick with Bitcoins in your local wallet and never touch it.
But if you are doing anything with your Bitcoins that involves trading it againts fiat, you can't just act as if exchanges were not a part of the Bitcoin reality, and you also end up holding a promise for the thing, except that unlike in Ripple that promise is illiquid and not provable.

Same thing here: from a Rippler's perspective, there is no Ripple vs Bitcoin, but Ripple + Bitcoin.

Only a fool would hold debt (whether Ripple IOUs or specific exchange IOUs) for an asset that he can withdraw / redeem in a matter of minutes and hold locally in a secure way. In this respect, even the most convinced Ripplers keep their crypto-assets safely in their wallets for long term storage. For these, there really is no point comparing Ripple and the other crypto-currencies directly since Ripple isn't meant to be used to store these assets but only to exchange them. Ripple Labs even went to the extra length of developing a bridge to make it possible to withdraw crypto IOUs to their respective blockchains directly from within the Ripple client. For crypto-currencies, the only difference between the classic approach and the Ripple approach is that short term storage of debt is safer in Ripple as it remains liquid and provable.

For fiat now there is no choice on either side of the line: you have to deposit your fiat and trust the exchange. With the classic approach, if you are doing arbitrage between exchanges, you have to deposit and withdraw money from each exchange individually, and need to trust each exchange to honor their debt. In Ripple, you can hold all your cash as IOUs of the exchanges or gateways you trust the most, do bank transfers in and out of these select few, and only deposit and withdraw the funds to untrusted exchanges when you actually need them there. That way you can still seize opportunities on sketchy exchanges without being exposed to counterparty risk any longer than the couple of seconds or minutes needed to complete the transaction and withdraw back to Ripple. In a world where all known exchanges would be Ripple gateways, one would for example be able to deposit and withdraw fiat exclusively on Bitstamp and hold exclusively Bitstamp debt while taking advantage of occasional arbitrage opportunities on sketchier exchanges such as MtGox or BTC-E. Another enormous advantage of Ripple in that case is that you can move fiat between exchanges instantly wereas it would take days with the classic approach.

Let me ask all the Ripple supporters something. If there was a new coin created called ReallySmartCoin, and the people behind it said everyone should buy it, but when asked how many ReallySmartCoins existed they said well there is X amount,  um No.. you can't check for yourself, just take our word for it.

What do you think the community's reaction would be? Would you say people should support and invest in ReallySmartCoin?

If you answered yes please explain why.

If the people behind ReallySmartCoin said they were working on a way to use them to trade anything of value in a distributed exchange system, would you then support it if you answered no above?

It's easy to say that exchanges are just for exchanging and people should cash in and out quickly.  The reality is that there are costs in terms of fees and inconvenience (captchas, email verifies, delays) that make it difficult to do so.  So many people end up just leaving money on the exchanges.  And get bitten when they fail.   Is Ripple any different in this regard?   Is it 0 cost in terms of fees and near zero in terms of inconvenience to cash out my bitcoin IOU for a real bitcoin?

Otherwise, I don't see how that is much different from any of the other exchanges.... entities that I put approx zero trust in.

Add that to my earlier arguments


By the way, darkcoin is giving away coins too
https://www.darkcointalk.org/forums/general-discussion.2/ (https://www.darkcointalk.org/forums/general-discussion.2/)
and they don't alienate certain parts of the community when doing so.

The engineer in me is somewhat tempted to take a closer look at the technology and figure out exactly what problem is being solved, but if its not completely decentralized
and controlled solely by the community as a whole, I doubt I will dig deep.

The difference between ripple and Bitcoin is that ripple is a scam (http://trilema.com/2013/ripple-the-definitive-discussion/).

Dude, seriously?!
That's your interpretation and definitely not the final conclusion! Ripple ledgers are similar to a signed UTXO set in Bitcoin terms. If something like this (also called "ultimate blockchain compression" in the dev forum here) was implemented in Bitcoin in the first place, there would also have been no real need for full nodes to download gigabytes of stale transactions and you could be up and mining from scratch after loading a few dozen MB.

It is not my fault that you confuse technical terms (Ripple ledger) with accounting terms (a book keeper's ledger --> full transaction history) or that the proper choice of terms for Ripple would have been "balance sheet" maybe. I did not design that system, I use and study it.

XRP are cryptographically accounted for since ledger #32570 and there are efforts to push this back to have the genesis ledger at #0. Still at 32570 there were less than 100 billion XRP already and their amount has been only going down since. There is also no transaction possible currently (and yes, you can check that in the code for rippled) that would allow issuing any more of them.

Anyways, why are we even talking about XRP in here so much?! They are a centralized currency and not the greatest one anyways. You can get more of them than you'll likely ever need for the price of a beer and be done with them. Anything more than that is pure speculation and there are easier markets for gambling your money away...

Actually that's a project that might be very interesting - to create a fork of Ripple that can use XRP and BTC or some other cryptocurrency for the purpose of spam prevention. They use similar enough crypto that it might even work, the only issue is that Bitcoin transactions are damn slow, but if someone is really disgusted by XRP, that won't stop them I guess. Another problem tmight be that validators then would need to watch a block chain too, creating more attack surface and another source for errors. It's definitely possible though.
The genesis ledger is #32570 and it is publicly available with all its trust lines, XRP amounts and trade offers within.
You would rarely hold Bitcoin IOUs to begin with, Ripple for bitcoiners would work similar to Coinbase or BitPay - most if not all of your funds are with you and you only convert them to IOUs if you want to trade them (e.g. atm. on traditional exchanges) or buy something denominated in a different currency (e.g. you buy a computer game on humbe bundle via coinbase, who then trade on behalf of HB).

Edit: Unlike coinbase, Ripple would likely add other payment networks via bridges though, not just single merchants. Once someone strikes a deal with e.g. PayPal, you could pay with Bitcoin to any site that accepts PayPal for example.

There are currently fees (for sure in XRP and potentially in IOUs too) as well as the normal market problems: spread and slippage. Unlike for example a bank transfer to an account in a different denomination though, you can get active there too and just put in a different offer, that might get taken.

Sorry, but Mr. Popescu simply did not understand a few things, his example with the little daughter for one thing is flawed and can't happen that way. Feel free to try it out with a few accounts inside Ripple right now, it won't work. Unfortunately as far as I have heard from him, he seems like lomeone who rarely if at all changes opinions after he has made one... I wrote a longer piece about this blog post elsewhere, if you really want to, I can copy-paste it in here too.

I've always been totally confused by Ripple. It makes no sense to me, and I've tried to look into it several times. My assumption is that if you cannot easily explain it, then it is probably a scam.

It's a decentralized market place - you take whatever you want to trade there, put it into a storage room of your choice (= gateway) and get a receipt for that, then proceed to trade this receipt with someone else for a recepit of what you want to have and in the end of the day go with the other receipt to a different storage room and get out whatever you bought. You can choose the storage room yourself freely, hell, you can just open one yourself and hope for customers. Also you can go there with your hands full of receipts that you just filled out and signed yourself. This is why Ripple ensures that they are all properly signed by a certain issuer and that you need to state before you trade which storage rooms you trust to actually not just run with the stuff while you're not looking.
XRP would be the stamps on the receipts by the way, which are issued by a single third party and you can trade receipts for stamps and vice versa too if you like. Some people think that makes them valuable and they build huge collections, while on the other hand they were given out in huge quantities for free in the beginning to get the market going. They do have some value from utility, but only inside the market place after all.

But seriously, this argument is the single MOST used against Bitcoin and the typical "argument" why it is so much of a scam, ponzi scheme and whatnot.

That's your choice and your future knowledge base.  If I was an engineer, I'd be trying to study all the tech I could but that's just me.  As for your "alienate" comment, Bitcointalk was the first and largest giveaway to single members.  Many receiving 50,000 XRP all the way down to 2000 or so.  It was a huge giveaway and a lot of people here made good money.

Either way, it matters not.  The crypto-community is only a fraction of a fraction of the world population and for people who talk about "mass adoption" all the time, many of you certainly do think small.  This is global baby and that means spreading the currency to as many of the 7 billion people on the planet as possible.  This about changing the world, especially for the unbanked, under-banked and the millions financially oppressed.  If that offends you, so be it.  Enjoy your darkcoin, I look forward to seeing on the Ripple network where all currencies are welcome...but before long, you'll likely be utilizing Ripple and you won't even know it.  ;)

EDIT:  I want to thank the mods for keeping this thread up here this long.  I hope we don't have a trend of XRP, blah, blah, blah threads but it's good to have discussions on solid tech here nonetheless. I'll just be glad when this BS polarization in the digital currency world is over....or one can hope because fundamentally, we're all on the same side.

Cheers.

Basically, Ripple is based on Trust; and Trust is the greatest liability of all.

I fail to see your point.  The majority of bitcoin transactions are based on trust.

To back this up with some facts:
https://blockchain.info/charts/estimated-transaction-volume?daysAverageString=30 <-- 30 day transaction volume on the block chain.
http://bitcoincharts.com/markets/ <-- there are 4(!) different active closed source centralized purely trust based exchanges that have several times that volume alone, not counting others and not counting the volume that comes from sending money to and from these exchanges. Also not counting brokers like Coinbase or BitPay.

What is Ripple and how did it become so valuable. I am not to familiar with it.

Nice.  ;)


I personally wouldn't concern myself with Ripple's "value" as it means very little in the near term.  If you want to learn about Ripple though, I recommend you start with the Ripple primer.  Enjoy.  8)

https://ripple.com/ripple_primer.pdf

I get the impression you don't like "my" darkcoin. Personally I find any coin that adds features of real value interesting. There is a lot of coins out there that doesn't add anything significant to the original bitcoin protocol, and then there is coins that doesn't even respect, or value, the core pillars that makes bitcoin a revolutionary technology. And thats when I start to get wary.
In my opinion, mining is one of those core pillars that makes bitcoin disruptive and to work for everyone.
It may not be optimal, but in addition to the decentralized aspect, this is essential in order to avoid involving a central third party, which is obviously key.
Its about putting power into the hands of the little man, without making yourself a God in the process.
That can't be done without breaking a few eggs. You simply can't please everyone and have a revolution at the same time.

After watching the video referenced earlier I can't say I found anything that doesn't already apply to bitcoin or some of the other coins out there.
When I realized that RippleLab "happened" to mine the entire currency for themself, thats when I started loosing my focus completely.
I mean seriously, how can anyone compete with that?

Exactly, maybe up to 20% of bitcoins (probably far less - I hope) are on a "trusted" exchange\online wallet.  We trust them only up to what we are willing to lose.  Otherwise, these coins are on USB drives, printed wallets, whatever.  I only use a trusted exchange when I have to - conversions, purchases, etc.  Else, cold storage is the way to go.

That's what Ethereum is doing for their fundraiser and it doesn't seem to deter potential investors because not everyone is a sociopath incapable of trusting anyone to deliver on their promise.
But anyway, that rethorical question is irrelevant in the case of Ripple since the number of XRP is fixed and <100B as can be asserted from any ledger close, and the source code of validators in charge of guaranteeing that this remains so is opensource.

You nailed it: moving money in and out of exchanges with Ripple is essentially free provided that exchanges don't add their own fees on top in which case it is more something specific to the exchange and not to Ripple per say.

I have no interest in Ripple because I can already buy almost everything that I need with Bitcoin, and soon I will be able to buy literally everything I need with Bitcoin. That is the vision of Bitcoin that made me a believer - one currency that can be used to buy anything, anywhere, instantly. Middlemen, whether they be traditional banks, fiat-Bitcoin exchanges, or Ripple, have no place in the ideal world of digital currency. Obviously, Bitcoin exchanges are necessary now during this transitional stage, but it seems to me that Bitcoin users have few uses for Ripple now and will have even fewer uses, eventually none, as Bitcoin weaves its tentacles deeper into the global economy and realizes its full potential.

Ethereum appears to be a block chain based currency which is mined and mathematically verifiable, just like cryptocurrencies we're already familiar with:

https://github.com/ethereum/wiki/wiki/%5BEnglish%5D-White-Paper#wiki-currency-and-issuance
https://github.com/ethereum/wiki/wiki/%5BEnglish%5D-Dagger


Don't you know the first person to engage ad hominem attacks loses by default?


The question was not rhetorical.


Again, the amount of Ripples in existence is conspicuously not mathematically verifiable. Statements posted on the Internet are not adequate proof.

If I may ask how did you get your Bitcoins in first place?
If you mined them and made it a policy not to ever exchange them for fiat or other crypto-currencies, then indeed Ripple is not for you. But keep in mind that you are the exception, and the overwhelming majority of Bitcoiners want to be able to move in and out of Bitcoin and to fiat or other crypto-currencies. To this vast majority, Ripple offers instant balance teleport between exchanges, gives back to users full control over their exchange balances / debt, and enforces cryptographically exchanges accountability and book keeping.

Comparing Bitcoin alone and Ripple makes no sense since Bitcoin is a commodity and Ripple is a distributed exchange and payment network. It's like comparing the Apple stock and the Nasdaq exchange. However comparing Bitcoin + traditional centralized exchanges VS Bitcoin + Ripple is very relevant, and that's where it becomes clear that Ripple is a major step forward for Bitcoin and a solution to the recurrent issue of poor exchanges transparence, accountability and tendency to setup arbitrary capital controls.

Based on the same reasoning (or lack thereof), the amount of Bitcoins in existence is conspicuously not mathematically verifiable either. Now prove me wrong without relying on statements posted on the Internet.

I think we're done.

I would add in a Gene Wilder voice (Depp was not as intense): "According to all the published source code as well as the performance data from the last five years, it is clear that the Bitcoin protocol is based upon the claimed mathematically provable limit. You would know this if you had done any research first. Also, you did not return the Everlasting Gobstopper. Good Day, Sir!"

I bought from local sellers and from exchanges. I did say that exchanges are necessary now during the transition to a Bitcoin economy. If Ripple can make the exchange system better during this transitional phase, I am all for it. But the direction that most of the people in this community want us to go is toward an economy where Bitcoin the currency can be used on the Bitcoin payment network for all transactions. If Ripple helps us get there, good, but I think we are already on that trajectory regardless of what Ripple does or becomes.

It is sad how uneducated a lot of the users on bitcointalk are when it comes to Ripple.

Probably the most promising financial protocol out there apart from Bitcoin.

Instant transfers baby! 

I see that nobody in Ripple wants to talk about counterparty risk.

And so is Ripple, QED.

Simply because counter party risk is the same as with classic crypto-currency exchanges, so not a difference between Ripple and Bitcoin.

Instant transfers is easy to achieve using a few heavy duty centralized servers around the world, if that was acceptable there would be no point in decentralized currencies, and government/banks would take control of those and out compete all our coins in a heartbeat.

That said, I'm open to any exciting features Ripple turns out to have, as long as they are decentralized and reward based (as in mining fees)

The worlds transactions are based on trust.  There is no way around that, as Bitcoin itself has found out.  What do people think BitPay and Coinbase are?  They are centralized companies based on trust.  The businesses they sign up don't accept BTC....BitPay and Coinbase accept BTC as 3rd party, centralized companies.  (clearing houses)  They in turn pay the businesses in USD.  So businesses are really just accepting the fiat currencies they are used to and Bitcoin is using a central clearing house to achieve this.  The same as Visa does or banks via ACH.  The goal is to move away from that.  (At least for me.)

With Ripple, the consumer and the merchant can cut out the central clearing house.  Consumer sends BTC and the merchant receives USD.  Confirmed and irreversible in seconds.  This is distributed exchange.  Globally this can be any currency.  Consumer sends BTC and merchant in China receives Yen.  Confirmed and irreversible in seconds.  Or, consumer sends frequent flyer miles and a merchant in India receives Indian Rupees or gold even.  Whatever.  Confirmed and irreversible in seconds.  The possibilities are limitless, ridiculously fast and cheap because we are trading peer-to-peer, instead of peer->to central clearing house->to peer.

So again, if you're one that plans to only deal in bitcoin -> bitcoin transactions, Ripple doesn't offer you much.  There is no argument there.  However, with hundreds of digital currencies and hundreds of fiat currencies, a scenario like that is simply unrealistic for the majority of the planets population.  Just as we don't all use AOL for email.  We use countless email platforms but we needed a protocol, SMTP, in order to communicate outside our specific email platform.  

So Ripple (RTXP) will do for money, what SMTP did for email.  SMTP was and is not a competitor of Gmail or Outlook or AOL or any other email platform.  It's just the protocol that allows them all to communicate and exchange information directly.  Just as RTXP (Ripple) is not a competitor to Bitcoin or Litecoin or DogeCoin or any other digital or fiat currency.  It's just a protocol that allows all these things of value to be exchanged directly.

https://ripple.com/ripple_primer.pdf

Spot on +1

No.  Bitcoin is the SMTP for money.  Ripple is a company marketing a new incompatible email system based on closed standards partially opened up just to say so. 

How can I transfer Euros with Bitcoin and withdraw the same amount 2 weeks later? How to bridge from Bitcoin to even something like Litecoin? ::)

The SMTP comparison is really a way to express the fact that Ripple is a federation protocol to bridge the gap between all money systems including legacy fiat money, blockchain based crypto-currencies, virtual currencies and other types of exchangeable values such as airmiles.
Nobody denies the fact that the Bitcoin network was the first network to allow trustless teleportation of funds accross the world, but Bitcoin network is solely designed to transport Bitcoin currency and nothing else. It is a great and very robust transport, but it doesn't federate  anything and using Bitcoin you won't be able to pay a SecondLife merchant in Linden Dollars using your BTC balance at Bitstamp (this scenario is already a reality in Ripple).
There is absolutely no overlap between Bitcoin and Ripple in term of functionality: Bitcoin is the store of value backed by the most powerful computing network the world has ever seen, Ripple is a medium of exchange where Bitcoin can be exchanged instantly to or from any other type of asset.

Again, this is a lie.

You can't move any type of asset, except for XRP, in Ripple.

You can only move promises to deliver assets in Ripple.

Do you post this stuff in any other exchange's announcements too?

I get the impression that a better question would be "What is the difference between Ripple and OpenTransactions?"

The funds that are reflected in your bank account or Paypal account or Bitstamp or BTC-e or Cryptsy or Visa card or Reward Points cards, etc...are all just balances.  What's a balance?  It's just an IOU.  They "owe you", X amount.

Ripple just allows people to exchange these balances (IOU's) between one another.  The trust you put in the places where you have balances (IOU's), is really up to you and has nothing to do with Ripple.  


I'm not totally familiar with how OpenTransactions works but from what I've heard around, it would be a much more compariable "idea", than trying to compare Ripple to Bitcoin or any other currency.

Open Transaction is (if anyone actually would use it) more similar to the stock exchange system (you list your stuff on certain exchanges and trade there) while Ripple is more similar to the banking system (you connect to a global market).

In OT, you find your trading partner, agree on a server and trade there in high speeds and in secret hidden from anyone else. I'm not so sure how double spends are prevented then, but that is a mere technicality if for example servers talk to each other. I'm also not sure how they fight spam, maybe they just attach a small PoW to each transaction or so (e.g. submit a transaction + nonce that meets a certain difficulty if combined with the TXID) or do something different.

On Ripple you only have this single network you trade on, with the benefit of having the maximum possible liquidity and offer range and the downside that everything has to be public and due to it being a globally distributed system it still takes relatively long compared to what traders in other areas are used to.

From this thread (https://bitcointalk.org/index.php?topic=512694.msg5660411#msg5660411):

Ripple != XRP. The sooner you realize this, the better.

Is this not what tradefortress or someone else did to a load of n00bs (like ~coinseeker~) who did not understand why ripple was bad; 'taught them a lesson' that ripple was just an IOU by defrauding them of real bitcoin and never paying them back?

https://bitcointalk.org/index.php?topic=207718.0

There are many threads on this behaviour and also on ripple's many shortfalls. It will just never work on a global scale its ridiculous and un-enforcable

It's totally going to work and it's already working. Better get used to it.  ;)

 All tradefortress did was use his popular and trustworthy status on Bitcointalk to dupe people into accepting his IOU's of BTC. Basically, M. Karpeles Jr. People choose to trust him and take him at his word.  His word proved to be complete trash and it's no surprise he also ended up pulling off one of the biggest BTC scams through his input.io site.  I BTW, never lost money to Tradefortress as I would never deal with a gateway I don't trust and I never trusted him.  

This is not a fault of Ripple, this is a fault of people putting their money with 3rd parties, they can't trust.  Simple as that.  Which is no different than the people who got Goxxed.  Do we blame Bitcoin for that?  Of course not, so don't try to blame Ripple just because there are people in this world who are dishonest.

During the Gox crisis all threads about Gox were moved to Service Discussion. That issue had imo far more relevance to Bitcoin and Bitcoiners than the Ripple service does. Obviously the mods are not asleep, otherwise that thread about Dogecoin would not have gotten removed. So why are discussions about Ripple suddenly allowed back in the Bitcoin Discussion subforum?

There was a nonsense Ripple thread this morning that got removed.  I can only speculate but I hope it's because we're having a sound tech discussion on the benefits of Ripple for Bitcoin, especially in this post Gox climate where decentralized exchange is exactly what is needed.  Again, I can only speculate but as I said last night, I personally do appreciate it.   ;)

Ripple is fine as long as it's not falsely advertised.

like maybe a fake marketcap ?

https://coinmarketcap.com/

Ripple and Open-Transactions (since someone mentioned it eariler) are both systems for tracking liabilities. Bitcoin is an asset ledger.

Commerce and finance will always involve liabilities, so there's always going to be a need to account for them.

Whether Ripple or OT is better for that task would be a subject for another thread.

First I haven't talked of "moving" but "exchanging".
Second how is it different on Bitstamp, BTC-E, NYSE, Nasdaq...?
You *cannot* exchange assets electronically without relying on IOUs.
Once you have wrapped your head around that concept, what Ripple does is exactly like what every other exchange does but distributed and safer since your debt remains liquid no matter what the issuer does, and cryptographically provable book keeping is built in and forced upon gateways by the very fact they issue IOUs.

The crucial difference is interest.

That or trust.

I have a hard time wrapping my mind around IOUs. It reminds me of the old adage:
"You ask for credit, I no give, YOU get mad.
I give credit, you no pay, I get mad.
Better YOU get mad!"

In early days, appliance stores had credit managers. They would investigate people before approving them for financing. (This was even before Bank Americard and Master Charge became commonly used). Asking for credit was embarrassing and only for necessities. Failure to pay meant they had their appliances repossessed. Later, credit cards and bureaus made borrowing painless. Now credit is at a point of absurdity, especially with identity theft and credit card thefts.

It's bad enough that credit ratings are handled by just three centralized bureaus, and they know almost nothing about people other than what is in a database. Judging by the inaccuracies in credit reports, they cannot work well or efficiently. The way I see this Ripple thing is even more ridiculous credit. Now, I am supposed to just accept an IOU on some anonymous person's say-so?

Instead, we need to go back a step when it comes to credit. Bitcoin has plenty of potential through scripting and colored coins to create local credit centers using local investigators. If businesses need customers, they will have to be competitive. If someone with a good reputation has rough times, then the local community will take care of their own. Credit cards work well with an inflationary currency because they can be bailed out for bad loans, but as we are seeing now, it is a death spiral for the currency. Still people and businesses will probably still prefer the easy credit rip-offs. Good Times!

You just went on this long rant about "credit" and Ripple has nothing to do with credit.  I understand if you didn't read every post in this thread, I myself do that when time is short.  Ripple is about balances, not credit.  I'll just repost this here and I encourage you to read some of the other posts and/or the Ripple primer when time permits.  


Additionally, you can not be forced to hold a balance from someone you don't trust.  It is 100% your choice.

Okay, so if I understand this correctly, an exchange issues and IOU represented as Ripple, which you may then use to transfer value elsewhere and cannot be exchanged with another account holder. Each Ripple agent will 100% identify the IOU Ripple holder to transfer the account and Ripple cannot be used for settlements of accounts with any other person. Correct?

If you are a proponent of face-to-face barter with exclusively physical goods as the only acceptable way of doing business, I can understand how living in a system where accepting IOUs is the norm must feel very frustrating.

Nowadays, corner shops that sold you interesting stuff for cash are all out of business, and you have to go online order things and trust the online stores to hold on their delivery promise, and for days you are left holding ridiculous product IOUs from Amazon and the like... Worse, you can't just hold cash under your mastress with all those robbers wanting to steal it from you, so you have to give your cash to a bank and accept in exchange their IOUs, and all you get out of it is monthly statements that remind you how much money you just gave them. And even if you keep the cash under your mastress, it will awake at night and bite your ass because even your cash is IOUs backed by nothing but immediate buying power that keeps shrinking as the issuing government keeps issuing more such unbacked IOUs. Hell, even the butcher at the corner shop is part of the IOU conspiracy: you went to buy 1lb of spare ribs today but he says he doesn't have it right now so you paid anyway, got your receipt, and you have to come again pick it tonight with you receipt. In the mean time you'll have to spend the whole day biting your nail in angst of whether you'll be able to redeem that 1lb spare ribs IOU.

So of course when Bitstamp, BTC-E and hell even Ripple tell you that you'll have to trade with IOUs, how can you not laugh at their stupid face!

You will *never* accept IOUs anymore. Now you have got Bitcoins, and you will use them exclusively for face to face barter with the farmer next door because their is no other way you can spend them without accepting IOUs, and nevermind it was conceived for pseudonymous global money transfers!

No, an exchange issues IOU's based on your balances with the exchange.  It is not represented as Ripples or XRP.  If it's BTC, it will be represented as yourgateway.BTC


It can be exchanged with another balance or into XRP (Ripples) and then from XRP you can go into any other thing of value.  You just can't be forced to accept something, you don't want.


This is where you lost me.  I'm not sure what you're asking but I'll try.  By Ripple "agent" I'm assuming you're talking about the gateway or "issuer" of the IOU.  They are not going to "identify" the holder of another balance.  That's irrelevant to a trade.  All there is to it, is you have a balance and if you want to trade that balance for another thing of value, you can, as long as someone else is on the other side of that trade, willing to accept your balance in exchange.

I'll give a scenario and hopefully it will get you and I closer on this.

Ripple is a distributed exchange (no central clearing house, or centralized exchange needed) that let's you and I trade anything of value. Peer-to-peer.  Ripple allows federating payment networks so let's say: Paypal, Bitstamp, BTC-e and Bank of America are all gateways (issuers) on the Ripple network.

You have a balance at Bitstamp of 100BTC and a balance at Paypal of $1000.  I have a balance at Bank of America for $20,000 and a balance at BTC-e of 10BTC.

You want 10BTC at BTC-e to take advantage of some arbitrage opportunity.  I'm willing to sell you my 10BTC for $5,000 of your Paypal balance.  If we agree via Ripple, boom...the trade is made and confirmed in seconds.  You now have 10BTC at BTC-e and I have $5,000 at Paypal.  So:  Paypal.USD -> BTCe.BTC

But let's say you wanted to sell 50 Bitstamp.BTC.  I'm willing to pay with BoA.USD.  But you don't want to deal with banks so no trade is made.  You and I have to agree on what we trade.  What you're trading for is always listed in the orderbook.  So you wouldn't even be looking at a BoA orderbook, if you didn't want to accept their balances (IOU's).

The only time XRP or ripples would come into play, is if no direct market existed and then the trade would look like:  Paypal.USD -> XRP -> BTC.BTC-e  

XRP is just a bridge currency to help facilitate trades when direct liquidity does not exist.

I didn't mention XRPs. I think I understand the Gateway system. This is just a FUNDAMENTAL questioning of credit. Why should I trust an exchange with PayPal if I have an account with BoA? Why should I trust a Cypriotic bank if I have an account in China, or vice versa? Boom.... and it's gone! The gateway system will mitigate these problems (if it is transparent), but will probably also become a local trading IOU system only like I was talking about originally. TRUST NO ONE.

I'm not talking about small business, I am talking about localizing credit. Walmart could have credit departments that don't depend on national credit bureaus if regulators would allow. I think Walmart would laugh at a Bitstamp IOU. Large companies would adopt Bitcoin more readily if they were deregulated. They may create their own colored coin credits that could be traded on the open market without the need for a central Ripple authority.

Don't count small businesses out yet. Bitcoin is global and transparent. The latter is frightening to large businesses that cut corners for their big executive bonuses. The pendulum may swing back to small businesses that network globally. I hope the days will end when I can eliminate IOUs from my transactions. It is an addiction that society will need to break someday.

I updated my answer above. Didn't get it before you had responded.   ;)   Had to read it a few times.  In short though, you don't have to trust anyone if you don't want.  But if you want something from a gateway you trust:  Bitstamp, BoA, whoever...then you have the ability to trade your balances for theirs.  Wire transfers...gone.  Just trade your balance from BoA -> Bitstamp.  Done in seconds and for pennies and that has nothing to do with credit.


I know freequant is going to respond this but I just couldn't let this go. 

First, Ripple is not a central authority.  It's just a payment protocol that lets us trade peer-to-peer.  No one has a say in what we trade.

Second, I don't think you really understand what an IOU is.  An "addiction".  We're not talking about credit.  We're talking about balances that you or others store with 3rd parties.  No, getting something and being able to pay for it later.  No.   

Correct, the gateways themselves will have to be trusted. I think you will have a very difficult time finding people that trust any gateway unless they will insure your transaction 100% from loss. Then you have reinvented the credit card.

No you haven't, you're just allowing people to exchange the balances they already have. You can't buy something today via Ripple and pay for it later.  ;D That's not how this works.

Millions of people use banks, Paypal, frequent flyer miles, rewards cards, etc., so suggesting no one is going to trust them, is not based in reality.  They do, everyday.  When you go to the ATM machine, it displays your balance.  The balances shown are IOU's from these institutions and hopefully soon, they will be gateways.  These gateways can then issue tradeable IOU's based on those actual balances. If you refuse to trust any 3rd party and only plan to deal BTC -> BTC forever, then you're right Ripple is not for you.  But IOU's are not credit...they are balances of actual assets being stored by a 3rd party.  Who you trust or don't trust, is up to you.

What are credit cards, but lines of credit you already have? They are spendable hard assets. All you are doing is adding additional fees to the lines of credit I already use.

I am not against anything. I am trying to understand what problem Ripple solves. Their is a global problem with institutional credit like "banks, Paypal, frequent flyer miles, rewards cards, etc." Bitcoin is here to solve those problems. Ripple seems to want to exacerbate the problem by adding another layer of abstraction. IOUs are only balances if the institution is solvent. Considering that most large businesses are leveraged 40:1 or higher and banks are no exception. Liquidity is a game of arcane prestidigitation. Ripple takes it at face value. Ripple is a quant's dream. It's a junk-bond clearing house on steroids. Forget 40:1, with Ripple you can leverage 4000:1. Line up to get your bank accounts paying 10% interest if you exclusively use our Ripple Card! Who will resist that? Just be sure you get out first before it all collapses.

Like I said. Trust No One.

I suppose a gateway could issue a line of credit as an IOU since anything of value can be traded but I'm not talking about credit lines.  I'm talking about an actual $100 in the bank or 10BTC in Bitstamp or whatever.  Balances backed by actual assets.


True and this is where it comes down to who do you trust.  I don't trust Gox so their IOU's are worthless to me.  But I trust Bitstamp, so I take their IOU's at face value and I've done that since before I even knew what Ripple was because I enjoy day trading.

The problem Ripple solves is allowing balances to be liquid and thus tradeable for any other thing of value.  Like email before SMTP, when you could only send information to someone in your same email platfrom. Now with SMTP, you can send information to any email address, regardless of platform.  Ripple does the same thing for money and things of value because right now, each payment network is it's own closed system and you can't send direct to other payment networks.  A Paypal user can only send money to another Paypal user.  With Ripple, a Paypal user can send to any other payment network like BoA or Bitstamp or whatever.  A Bitstamp customer could send payment to any Paypal user or BoA user.

Another issue that it solves, is removing the need for central clearing houses and centralized exchanges.  Like ACH or Visa or even Bitpay.  No central entity required because we can send direct, peer-to-peer and in any currency.


Your rant about banks and fractional reserve is really preaching to the choir.  I'm with you there.  The rest of it is you simply not getting it.  With Ripple, I can always see how many IOU's have been issued from my gateway and if they are transparent, I can reconcile that with the actual assets they have on hand.  


Then you are one who plans to never use an exchange to buy and sell BTC correct?  You never plan to use Bitpay to pay a merchant, correct?  If so, there's nothing left to discuss because Ripple is not for you and that's cool.  You're hoping for an all BTC world.  I can dig it...I just don't believe that will actually be our reality but then again, who knows.

Why don't you trust MtGox IOUs? What makes them any different than Bitstamp aside from a temporary shutdown of services? I don't think anyone know anything for certain yet. ;) My point is, that Bitstamp may be even worse than MtGox and we just don't know it yet. So what good are any IOUs outside of a very limited market?

BTW, I am not hoping for a Bitcoin world. Color your coins and let me choose which I will cautiously trust. Bitcoin will stabilize in value as the raw materials for colored coin banks, payment systems, frequent flyer miles, rewards cards, etc. They will compete on a global financial battlefield.

This is true but I choose to trust them because I want to buy and sell bitcoins.  I can't do that if my bitcoins are in my wallet or in cold storage.


In Ripple, IOU's can be used in a global market. Through any payment system connected to the Ripple network.  Today it may be limited because of the limited number of payment networks integrated with Ripple, but that will change in time.


Ah, so you do believe in trust. Just "cautiously". Gotcha.  ;D

Is that why you didn't answer my questions?  Do you buy and sell BTC at any exchange?  Do you use Bitpay to buy from merchants?

Artistic license. Try not to take everything so literally. One beef I have with Ripple is that they are very well funded and very secretive. In fact, they gave early adopters a sweet deal. But that sets off all kinds of trust alarms. It's hard to verify anything they claim. As far as trading goes, I don't do large amounts anymore because the exchanges are much less predictable and there is more stability. If I will accept colored coin vouchers, it will be from someone I have independent verification of trustworthiness that only comes from face-to-face. Reputation systems are better than nothing, but are subject to the long con.

Here's where I am coming from. I have learned a lot about small business over the many decades of my existence. I have seen the changes in America and around the world. Some things about human interaction don't change. Technology only makes them more efficient. I would prefer we take the best parts and build something better. I am not against credit itself, it is a necessary evil, but colored coins should be more than ample and efficient to deal with it. If at some point a government or other large asset holder decides to exchange colored coins for their own RippleRapple or whatever color and make it profitable, then the cycle of power abuse will continue. But at least the blockchain will have records and there will be consequences for bad agents.

If you trade any amount, then you are already dealing in IOU's.  The difference between your IOU's and mine, is that mine are liquid and yours aren't.


Hey, I respect anyones right to transact the way they choose.  I think Ripple does exactly what you just said, takes the best parts and builds something better.  No central clearing and no centralized exchanges.  As for RL's and the founders "sweet deal", I personally don't care.  They have built something so magnificent and certain to help so many people around the world, that if they can make this all it can be, then they deserve it.  I hope they become the worlds first trillion-aires.  

IMO, their "secrecy" is justified because they are not pushing for a mass userbase at the moment nor are they seeking to bring in mass amounts of speculators.  They are trying to implement Ripple from the top, down.  You can't go making all your meetings with payment systems like banks, regulators, market makers and other potential gateways public.  The things that are relevant to the community, they do share and are getting better at it all the time.

I respect your views and I have really enjoyed chatting with you.  I think in time, when Ripple has gotten more time under it's belt and has increased liquidity, gateways and overall utility of the network, someone as smart as you will give it a second look.  I don't think you really get it but I'm certain you will in time, I have no doubt.  You may still opt for something else and that's cool too...but I think you will at minimum see the brilliance in it.  

Regardless what you or I choose in the digital currency space, we're still on the same team and that's something I try not to forget.  We want a better monetary future and come hell or high water, we're going to get there brother.   ;)

If I didn't trust my wife, I would be dead. That doesn't mean I trust your wife. If you don't see the difference, then this is a lost point to argue. Liquidity is not universally recognized. I can say the same thing: "The difference between your IOU's and mine, is that mine are liquid and yours aren't."


May the best coin win.

You could say it, but you'd be lying.  Yours are locked in a centralized exchange.  If they decide to halt withdrawals, you're screwed.  If mine halts withdrawals, mine remain liquid, thus I can still trade them.  They'll likely be worth a lot less but still liquid nonetheless.


It's not a competition for me.  That's the beauty of Ripple.  Ripple is currency agnostic thus, it's success is not determined by the success or failure of any coin or currency.  Not even XRP.  Whatever coin you choose, I hope it goes big, not just for your benefit but because that means we'll soon be seeing liquidity for it in the Ripple network.   ;)

An exchange is centralized by definition. A decentralized exchange is a misnomer, they are distributed exchanges, but they still require trust and are centralized to a lesser degree. Like mining pools, there is much debate about how they should operate. Liquidity is a function of the the risk. Exchanges are all high risk. My liquidity and your liquidity are apples and oranges. If you are on Bitstamp in the USA and I am on BTCChina in Beijing, then arbitrage is very difficult. I don't think Ripple transactions from BTCChina will be any more accepted by Bitstamp than their vouchers.

Or nothing. You could say Bitstamp has more liquidity, but to me in China, you'd be lying. It's a matter of perspective. Unless your exchange is insured against failure or Ripple is somehow able to create trust between enemy economies, then I see little chance of surviving unless by force. Bitcoin has little chance of failure except by force. I guess it comes down to whose side you're on.

Ripple advocates are inclusive. They are advocates of Ripple, Bitcoin, and currency choice in general.

Bitcoin advocates, who are not also Ripple advocates, are divisive. They see Bitcoin and Ripple as competing systems.

Not true. Ripple isn't a working system yet. Ripple is competing with colored coin, mastercoin, and all the altcoins. Ripple is an untested idea at this point. I am open minded, but can't I wait until there is published sourcecode for the clients and gateways before getting behind it? Let's see some gold trading advertised for Ripple.

Source code for the client: https://github.com/ripple/ripple-client (https://github.com/ripple/ripple-client)

The client can be used as a manual gateway: https://ripple.com/wiki/Ripple_for_Gateways#Creating_a_Manual_Gateway (https://ripple.com/wiki/Ripple_for_Gateways#Creating_a_Manual_Gateway)

More information on operating a gateway: https://ripple.com/ripple-gateways.pdf (https://ripple.com/ripple-gateways.pdf)

Gold: https://www.ripplesingapore.com (https://www.ripplesingapore.com)

See it trading: http://www.ripplecharts.com (http://www.ripplecharts.com)

I'm curious about where you looked up that funky definition. Source?

How about the OTC market?
How about the black market?
How about the food chain (is god doing the arbitrage between supply and demand)?
How about Ripple? Ah, yeah, we've already mentionned that one...

Ripple's built in distributed exchange doesn't require any trust at all and is decentralized.
What requires trust in Ripple is the redemption of IOUs, but that has nothing to do with the exchange in itself.
You could start a day-trading business with the XRPs you get from a giveaway, and grow your stash by trading currency pairs on the distributed exchange without *ever* going through a gateway. Everything  you would do would then be perfectly decentralized and trustless given the fact you just don't care about being able to redeem your IOUs.

Again, that's a very exotic definition of liquidity, but I guess you must have an equally exotic definition of risk that makes it fit all together. Source?

Liquidity isn't a subjective quantity. It is an objective quantity based on the quantifiable availability of supply and demand for a given asset, that would allow you to open or close a position.
What Coinseeker is telling you is that, if you hold the debt of an exchange (be it Bitstamp or BTCChina) as a balance at that exchange, and the exchange decides to suspend withdrawal, you have no way to sell back that debt and get back your funds since the exchange who is the only possible counterpart isn't buying back the balance (aka. not allowing you to redeem it to real assets). In other words, you are screwed. But if you hold debt of an exchange as Ripple IOUs, even if the exchange decides to suspend withdrawals, you will still be able to sell your IOUs on the Ripple internal market to third party participants. You will suffer a mark down due to the situation, but you'll still be able to close your position.

So to make a long story short,
If you are using Ripple to hold your exchange balances:
- when there is no problem at the exchange, the liquidity of your assets = liquidity at the exchange + liquidity in Ripple.
- when withdrawal are suspended at the exchange, the liquidity of your assets = liquidity in Ripple.
If you are holding your balance directly at the exchange:
- when there is no problem at the exchange, the liquidity of your assets = liquidity at the exchange
- when withdrawal are suspended at the exchange, the liquidity of your assets = no liquidity at all

You can see that no matter how you look at it, balances held as Ripple IOUs are more liquid than balances held at the issuer exhange. It's not even a matter to debate, it's just a hard fact.

It's not about sides but whatever.  I gotta say though, it is frustrating when I see you not only don't know that Ripple is a working system, but that it's been open source since September of last year.  Which means, you haven't looked at Ripple since before that.  So, you're here talking and talking about something you don't know anything about, regurgitating talking points from early last year and I just find that quite disingenuous.  Jokes on me I guess.   :-\

They don't ship gold like Bitcoin accepting stores. You buy vouchers and hope they don't abscond with all your bitcoins. I will look at the source code if it can be used for trading colored coins. I am in the Philippines where there is a real need for exchanges for fiat to Bitcoin and B^2 coins. There really isn't much use here for Ripple yet. Filipinos like tangibles, and it's difficult enough to explain Bitcoin let alone Bitcoin IOUs.


I still don't see a working system. Why is it taking so long to gain traction?


We'll have to agree to disagree on liquidity. Tell China and Russia they have nothing to worry about with American bonds. They are AAA rated by America.

Cbeast,

Why ship gold when you can store it for free and liquidate into anything on ripple, anytime anywhere?
As soon as there are other gold gateways in other locations you can effectively move it without moving it...

Give them a break, Ripple is live since less than two years, don't expect every possible options to be available right away.
But if you step back and look at the big picture, what you will see is that Ripple can natively allow to trade virtually anything for anything else, instantly and at no cost, and allow deposit and withdrawals globally. It will take some time before it becomes obvious, but a few years down the line chances are high that Ripple is going to be something huge.

You don't even need to look at the source code: just start using Ripple and read the official forum, and it will become pretty obvious to you that you can trade anything on Ripple including colored coins. Actually, there is no one at the moment acting as colored-coins gateway in Ripple, so it could be an opportunity.

All that is needed to convert Peso to Bitcoins and the other way round is a Peso Ripple gateway.
Once that milestone is passed, you just need to advertize it locally, and the liquidity will build up.

There are many opportunities for a Rippler based in Philippine:
- creating a Peso gateway
- doing Peso/XRP and Peso/BTC market making
- integrating Ripple in a money transmitting business alongside other options like Western Union.

Then maybe there is a need for a middle man to handle the conversions.

The integrity of Ripple is based on the assumption that nodes do not collude.
The problem with this is that as they say in all disclaimers: "past performance is no guarantee for future returns."

POW secured convergence of the ledger in Bitcoin is in contrast an objective proof of the will of the economic majority.

Sometimes it's really difficult to decide if you are trolling or just really behind on your research.
Ripple is live with the full features set since almost 2 years, and trading actively since it launched, with growing volumes and a growing userbase, and gateways on every continents and all major economies. So much for the "untested" idea... Meanwhile Colored coins, Mastercoin and should I add NXT and Ethereum are yet to produce working code to handle distributed exchange.

All the source code of both the official client, the rippled server and a handful of utilities like graph pages, CMS plugins, and APIs are open-source.

So I went to Ripple.com to open my wallet. It seems the account is gone. The un/pw are not recognized and they were written down. The PW was very strong. No major deal. I didn't have much on there. Personally, I would rather have the gateways and wallets physically local so they fall under local jurisdiction since they are not transparent.

Who independently audits your service that it matches records at your partner's vaults? I'm not saying your record keeping could be wrong, but your partner's may dispute your records and there would need to be independent verification. I have not found that assurance on your website.
Also on your ToS
"Right To Redeem (RTR): means the redeemable electronic representation of an amount of currency or the troy ounce weight of an investment grade precious metal on the Ripple network." (emphasis mine)
"All services are provided without warranty of any kind, either express or implied."

I'm not questioning your integrity. It's just that the customer has little recourse in a dispute.

To answer your question, if it isn't physical gold in your hand, then it's an investment derivative, not actual gold, marketing notwithstanding. Still, I commend you on taking part of a grand experiment.

Once an account has been created in the ledger (which happens once you have deposited the reserve amount), it cannot be deleted. Ever. So I'm sure there is some good explanations to what happened to you. I don't think this thread is the right place to help you with creating an account, but if you share your experience in the New Users (https://ripple.com/forum/viewforum.php?f=5) section of Ripple forum, we can help you get started and activate your account.

Again, I think that discussion would be more on-topic on the Ripple forum.

True, that's why it is very important to choose well the nodes in your UNL.
If you add official public validators run by academic institutions in different countries, non-profits, government bodies of non-allied nations such as China, Russia, India, Pakistan, Iran and USA, competing private companies of different countries, libertarian groups, activist groups like EFF and Wikileaks, hacker groups, and competing political parties, and ... they manage to collude in such a way that more than 50% of them agree on the same lie knowing that their fellony is going to become history in the next 10s... the whole world is in an unspeakable shit that far exceeds immediate concerns about Ripple's integrity...

POW is weak because economic interest leads to the pooling of computer power between the hands of a few major players like mining pools and ASIC makers in the case of Bitcoin. Instead of having reputable organization of all nations and all walks of life puting their reputation at stake to collude, all you need in Bitcoin is to have a handful of Chinese ASIC makers and mining pools colluding.

Agreed. This thread should be moved to an altcoin section. It was a thinly veiled attempt to bring anti - bitcoin Ripple trolls. I tried to keep it civil, but they are relentless.

cbeast, you have a 1000+ posts 2-year+ old account.
It is sad that you haven't grown up after all that time.

Cbeast,

You raise some good points. Here is my reply. I welcome further constructive feedback but we best take that off-line.

1. Per the end of this month we will publish a table with links to independently verified documents (signed vault report with gold, silver and platinum holdings, certified true bank statements) Tabel headers will be [Outstanding liabilities],[Reserves],[Reserve ratio] and rows will be the asset classes.
It will be published here: https://www.ripplesingapore.com/Home/IRBA

2. Rights to Redeem relate to the physical bars that can be redeemed at our collection vault.
The electronic alternative is more like a sale of the RTR in exchange for another electronic IOU or XRP.

3. The prices for XAU, XAG and XPT track the physical prices so there is a premium over the leveraged paper varieties.

4. Storage is free...