Bitcoin Forum

Hi,

Here an interesting article about Ripple : http://dealbook.nytimes.com/2013/11/11/the-rush-to-coin-virtual-money-with-real-value/?smid=tw-dealbook&seid=auto&_r=0

Basically it said that Ripple is already welcomed by the financial industry and that it will receive a better greetings by governments than Bitcoin, plus the protocol don't waste any power with the mining stuff.

I am uber bullish on Bitcoin but this worry me a bit. I think Ripple make good points and has a shot for at least outcompete Bitcoin in the e-commerce, remittancee and micropayments markets (but not at all in the store of value "gold-like" market, here Bitcoin will remain the king).

What do you think about that?

Ripple is centralized, which will allow the government to control it. In that, Ripple has a good argument why it may be received more warmly by authorities. But it removes most of the advantages that Bitcoin offers over traditional currency.

That's why I think Bitcoin is not in competition with Ripple in the "hard asset" market.

But let's be honest, it looks like Ripple has advantages over Bitcoin in all other markets.

It's all fine and dandy when all nodes on your UNL are accessible, when it's not the case, however..............

Check this out: http://en.wikipedia.org/wiki/CAP_theorem

Ripple is out to cheat people. They wanted to restart bitcoin with themselves as Satoshi with his hoard. No way I'm in that.

Ripple has no elevator pitch. The system is way too complicated. I also don't like it being a debt based system. Isn't it the debt based monetary system that created all this trouble in the first place?

XRP is 100% "pre-mined" and controlled by a couple of big businesses, so, anyone who invest there - are just participating in another yet Ponzi scheme.
No surprise financial industry and government welcome it. They love such a tricky schemes to ripple-off people.

Bitcoiners have nothing to fear.  Ripple's success is good for Bitcoin.  Some will actually have to see that come to pass before they accept that, but it remains true nonetheless.  As you've accurately stated, Ripple does not change Bitcoin as an excellent digital store of value.  People who want to continue to store Bitcoin's with no counter party risk, can and will always be able to do that.  However, when you want to send Bitcon's to someone, especially in another country or in another currency, Ripple is hands down the best payment network crypto has ever seen.

1.  Send payment in BTC and the receiver can receive payment in any currency they choose.
2.  Payments are instant (within 20 seconds).
3.  Gives people greater access to BTC.  

Ripple doesn't attempt to replace Bitcoin as a store of value, but rather offers a significantly better payment network than Bitcoin or any alt-blockchain's can provide.  Again, this is GREAT news for Bitcoin and all of crypto.  Ripple is going to help legitimize the crypto world and provide an excellent "bridge" between the digital currency world and the fiat world.  Chances are Bitcoin values will only benefit from Ripple's increased reach, by again, giving more access to more people around the world and providing increased utility for Bitcoin.  These are exciting times and the journey for all of crypto, is just beginning.  

There's no way the Chinese will be interested in Ripple over Bitcoin - if they truly are interested in moving away from USD, then they would be more likely to get behind Bitcoin than an american company's version.

Ripple is a good "sucker" test.  If you think it's Ripple is a good idea and like it then I have a bridge in New York I'd like to show you.

But it makes Bitcoin useless for a lot of things too.
Why would you use Bitcoin to send value overseas when instead you can use fiat with Ripple?
Why would you use Bitcoin to purchase online stuff when instead you can use fiat with Ripple?

Also people calling Ripple centralized, but is that true?
It's also a P2P network, could he work if Ripple Lab were shut down?

That's really a choice for the people to make wouldn't you say?  We do still care about freedom right?


Yes, Ripple will still work.  Although it's fair to say that at present, just coming off open sourcing Ripple, RippleLabs is very much an important aspect of Ripple.

Yes but we care about Bitcoin's price too.

So we should care if something better than Bitcoin (i.e. which is more likely to be choosen by the market) exist.

Ripple is indeed a sucker test. It is centralized and the government could shut it down and seize all XRP in a heartbeat. No WONDER government and industry "welcome" it  ;)

Most of the reasons we use & support Bitcoin, are the same reasons we would not use Ripple.

"He who think Ripple is threat to bitcoin does not truly understand Ripple or Bitcoin."
-Confucius

Maybe talking about a sucker test is the real sucker test. Maybe it displays the inability to think about this topic in a rational way.

Coinseeker just stated that Ripple is not centralized. It's an open source protocol and a P2P network, like Bitcoin.

This. Ripple like fiat is a scam. People might fail to comprehend this though (they do with fiat) ...

Why people should care if XRP is "premined" ? Why everything should follow Bitcoin step by step ?

Mining is the way Bitcoin distribute coins, Ripple chose a different distribution scheme. It's not a scam, it's only a difference. Everything that is different than Bitcoin's blueprint is not a scam.


People only care what is the most useful. If Ripple is most useful than Bitcoin people will use it and won't give a fuck about those bullshit premined concerns.

A privately held company who can increase the supply of currency at will is not a scam?  That's like saying the Fed is not a scam.

People only care about what is the most useful, which is why most of them are utterly fucked when the normal way of doing things falls apart because currency supplies are mismanaged.

There is 100 Billion XRP out there and they have distributed only a small fraction of it. That means they will prop up the price and cash out the ripple at a later date.

The XRP supply is fixed at 100 billion, isn't it? I don't think the number can be increase, it's like the 21 millions bitcoins. Can anyone confirm this?

The fact that RippleLabs keeps a fraction and can move the price is EXACTLY the same thing that Satoshi and others early miners hold a huge amount of bitcoins => not a big deal. (But knowing if the 100 billion number is fixed or not is a big deal).

Actually the CNY gateway cap has jumped over the past month (from 250k CNY in october to 539k CNY currently, mostly at rippleCN), and I'm seeing a lot more CNY trades, so volume has increased too. Still a lot less than BTCChina, obviously, but it is spilling over. Stefan Thomas (ripple CTO) gave the keynote speech about Ripple at SDCC (software developer china conference) in Beijing a few months ago, microsoft VPs were among the other speakers.



Ripple's "killer app" right now is moving fiat between bitcoin exchanges. Ripple is an alternative to bank transfers, because you can hold gateway funds in any currency and transfer them (not just BTC), much quicker and easier than a wire transfer. Don't be surprised when more bitcoin exchanges become ripple gateways, bitstamp is just the first.

Its also misunderstood as debt based. Mostly because the "ripple classic" (which existed years before bitcoin) design was around community-based chains of credit (LETS local exchange trading system). Jed McCaleb & co-founders bought the ripple.com domain name from Ryan Fuggers. But they are building a much simpler network, where the trust lines are extended to gateways (the bitcoin exchanges) rather than community-lenders, and funds are backed by deposits (not debt/credit). But yea it is easy to confuse, especially for people who had first heard of ripple-classic (classic.ripplepay.com).

I have 600k XRP and would definitely welcome it exploding..

I could, however, understand arguments from anti-ripple group. I don't like it being centralized and one entity holding most of it, they can do whatever they want with the price. And it's easier for governments to control.

On other side, their platform is brilliant and transactions outperform Bitcoin by several magnitudes. And the most important thing I like about Ripple is that from the beginning it has a sense of a real company and that could have a major role in making it big, and attracting investors and service providers. It's already happening and it's still very early.

All in all I am very, very bullish about Ripple.

I like the article though, great thing for crypto world in general. People hear about Bitcoin all the time but they don't have a chance to see a link to coinmarketcap.com and find about alts too in mainstream media.

Oh no here we go again. Time for another  Ripple debate is it.   :(

Financial institutions will support Ripple, because it can be centrally controlled. There is no surprise to me at all in that statement. If Ripple does not succeed then banks will support the next fully centrally controllable debt based version of something thats a little bit like bitcoins to try and hoodwink the populace to swap free money for controlled money. Its exactly the converse of why they will never get behind bitcoins which cannot be centrally controlled. Which incidentally is what gives bitcoin such tremendous value to humanity.

Not sure I can be bothered with the argument again though. Ripples you can keep it.

Someone asked is 100 billion final cap. Yes, you could read it on this article too:

Hooray, let's replace the debt backed monetary system with.... an obligation backed monetary system! Wait.... that's suspiciously similar to debt based....

I think Ripple could be useful. A liquid network of gateways could vastly improve the efficiency of mobile/web payments generally, and I see no reason why bitcoin can't benefit from Ripple adoption. I think the goal is not decentralization but distribution, and there is some merit to that. As for XRP... I profited a few coins on XRP but I am not comfortable holding it long term. The most I'd ever need is a couple hundred--and with its centralized distribution, it's a crazy speculative gamble that I want no part of. I do like the idea of Ripple as a protocol, but OpenCoin/RippleLabs sort of make me sick, and I also think they shot themselves in the foot by dragging their feet on open sourcing.

Well it obviously makes little sense to compare XRP to a mineable alt-coin. It is more comparable to shares in a company stock. AAPL, EBAY (paypal), TWTR, etc.

IMO it is actually less ponzi-like than traditional company shares with IPO price-rigging, dilution, fraudulent accounting, and so on. And it is a lot less ponzi-like than some of the alt-coins which are raising funds on little more than overhyped proposals and lists of desired features - in one word: vaporware. While Ripple actually exists, has gateways, growing liquidity, and is already useful.



When you deposit funds to a bitcoin exchange, be it USD or BTC, the exchange is "obligated" to give it back when you want to withdraw (redeem). Its the exact same situation with ripple gateways (which is why some bitcoin exchanges are also already ripple gateways). Except on ripple you can trade and transfer deposits of any currency: USD, EUR, BTC, LTC... I love cold hard coin as much as anyone. But sometimes one wants to move USD around to different exchanges (e.g. to arbitrage price differences), and that's what Ripple does.

Damn, I am really stupid sometimes, never thought about arbitrage with Ripple... now if only some other BTC exchanges would start being Ripple gateways it would be brilliant.

Technically? No idea.

By (open-source) code, which cryptographically verifies changes to the ledger (like bitcoin does for changes to the blockchain). The ledger started at 100B, decreasing from there.

What I care about is people being free from a corrupt banking system, with the freedom to choose superior currencies and stores of value.  If that includes Bitcoin, so be it.  If people choose something else, so be it.  I have no interest in individuals selfish desires to get rich, over the freedom of everyday currency users.  If Bitcoin is indeed a superior currency to USD, EUR or anything else, people will choose it out of free will.  If not, they will choose something else.  The question is, do you really believe Bitcoin is a superior currency?  If so, what are you worried about?

None of this has anything to do with Ripple. Ripple is a payment network that allows people to utilize any currency they choose.  So from that aspect, Ripple is currency agnostic.  If some peoples desire is to rid the world of all currencies and just replace them with Bitcoin, then that sounds alot like communism and I reject such a plan.  I like choice and when sending and receiving, I like the flexiblity to do so in any currency, in an instant.  That ability only makes Bitcoin that much better.  If it is indeed superior to government fiat, which I do believe it is.

Another thing to note from the comments in this thread, is how many people still think Ripple = XRP.  Ripple is a payment network and decentralized distributed exchange.  XRP is the currency built into the network, to prevent spam and yes, it does have the ability to be valuable one day.  Although speculating on XRP is EXTREMELY RISKY.  There is nothing that says it will be.  In either case, if you don't like XRP for one of several reasons, don't use it.  Aside from account minimums, you are not required to hold XRP.  Just like you are not required to hold USD, EUR, YEN, LTC or any other currency.  Ripple provides choice and a payment network, worthy of the awesomeness of crypto currencies, like Bitcoin.

It doesn't much matter if you believe it or not, it's still happening.  All the FUD in the world didn't stop it from open sourcing and all the FUD in the world is not going to stop the world from embracing it. Soon you will be using platforms that are built on Ripple and you won't even know it.  It is an amazing time for the future of digital currency and payments.

Ripple is a hybrid system between:

1) The traditional banking / payment methods such as banks, wire transfers, credit cards, web based services such as  PayPal, E-gold, Liberty Reserve, Western Union, Moneygram, Hawala etc.

and

2) Bitcoin and other cypto-currencies.

In the first model the sender pays the funds to a trusted provider who in turn pays the funds to the receiver directly or in many cases indirectly via one or more other trusted providers. In the second model the sender pays the funds directly to the receiver with no trusted intermediary needed.

With Ripple the sender pays the funds to a trusted provider, the senders gateway. The sender then sends the sender's gateway's credits to the receiver via a crypto-currency as in 2 above, who then either:

1) Gets paid by the sender's gateway.

or

2) Gets paid by a gateway who trusts the sender's gateway.

I can see there are situations where this can be an advantage over 1) or 2) above; however it will not replace either 1) or 2) above. In short it will complement rather than compete with Bitcoin.

I believe in free market too (not in free will but that's another story).

I just want to know what is the potential market shares of the stuff in what I am investing my money (indivuals with selfish desires to get rich is what makes free market works)
It not because we discuss about wether Ripple is a competitor or not that it implies we are against competition.
Why do you think speculating on XRP is extremely risky? You mean riskier than speculating on Bitcoin?

Some wouldn't, and that's fine it it's their choice. But if you use fiat IOUs you are still at the mercy of governments and central banks. If you use cryptocurrencies (Bitcoin, Ripple's own XRP, or whatever) you aren't. The fiat IOU payment system is then still a great way to get your hands on cryptocurrencies and to help accelerate their adoption.

It's important to realise that Ripple is really several systems rolled into one:

- XRP, a cryptocurrency much like bitcoin
- a fiat IOU payment system
- a distributed exchange which can be used for any currency, crypto or otherwise


No, that's a lie.


Absolutely. In fact, their business depends on the network being able to survive the demise of Ripple Labs. Making Ripple dependent on Ripple Labs would have meant painting a larege target on their backs. Since Ripple Labs can no longer take down the Ripple network, governments will have much less of a motive to go after them, even if they did want to go after the Ripple network. Some of the people behind Ripple learned a hard lesson when eDonkey, an earlier company they were working on was taken down in order to take down its network.

As I said, investing in XRP is risky.  My comments have never been about XRP, until the end of the last post to address multiple comments.  My interest is in the payment network and distributed exchange.  That's what matters.


Who is "we"?  I quoted the comments from the person I was directing my comments at.  I think it's perfectly reasonable to ask the question but again, since my previous comments that caused the response, never once mentioned XRP, I fail to see how my description of Ripple could be considered as Bitcoin competition.  


For several reasons and many that are consistent with Bitcoin and obvious to us all.  But more specifically, there is nothing that says XRP will significantly increase in value.  XRP doesn't need to increase in value for the Ripple network to succeed or function as it should.  What's more important is consistent values, for market makers.  XRP may reach parity one day or it may remain simply spam prevention.  Again, because Ripple the payment network doesn't require XRP to be ridiculously valued, makes it very risky IMO.  I will add though, IMO, I think the risk vs reward is tremendous, especially given todays XRP prices and because of that, I do hold a little XRP.

Spare us the earnest explanations, Ripple is just a way of recording all your financial transactions as obligations and swapping them with other Ripple users. It enables you to do nothing that wasn't already possible using cryptocurrency, exchanges and the fiat system. In fact, you can do less with it, as it seeks to act as a go between for these systems, but there are no well known fiat institutions or exchanges that work with Ripple. And even if there were, you have to use the real systems it is piggybacking anyway, otherwise the obligations you've created can't be fulfilled.

Complete waste of time.

Ripple federates payment networks much the way SMTP did for email.  The ability to send Gox -> Btce -> Stamp -> Bank, absolutely does not exist in a way that is instant. If it did, you wouldn't have these crazy spreads between exchanges but arbitrage opportunities are too slow and expensive.  It would take weeks the way you describe it and the costs would be ridiculous.  Now it's true, no banks have yet come on board but patience Daniel San.  Ripple has only been open sourced what, a month?  A little more?  Either way, Ripple is here to stay and the crypto space is better for it.  

So far, the only example of usefulness of Ripple in this thread is to support arbitrage across exchanges, but only if those exchanges accept Ripple.  I understand that would be extremely useful for traders who regularly trade in multiple currencies.

But why should the average Bitcoin user, who only has one type of fiat, bitcoins, and does some light trading on one exchange (coinbase/bitstampl/btcchina) even care about Ripple? Should they be lobbying their fiat banking institution to get connected to the Ripple network so that they can trade easier at international exchanges?

lol, it has the word "rip"(off) in its name.

r.i.p.

One cool aspect is that you can see the total bitstamp funds held on ripple (current bitstamp gateway cap is $357k USD and 2,703 BTC). Before ripple, the only other way you could estimate the total USD or BTC funds on an exchange was by adding up the total bids and asks visible on the order book. When an exchange becomes a ripple gateway, it gets more transparent. Its pretty neat being able to watch the total fiat funds moving in and out through ripple (kind of like the early excitement i had watching btc transactions move around on the blockchain at bitcoinmonitor.com). Its as if you worked at the bank and had access to bitstamp bank account records (just a partial view though - only the fund movement through ripple). IMO the gateway cap is also a very useful indicator for speculating, both on BTC price but even moreso on XRP price. e.g. if bitstamp.USD is being redeemed and deposited back to bitstamp, then somebody is probably planning to buy BTC (and vise-versa XRP).

When people I know need to take payment, they want dollars (or local currency), not bitcoin. If Ripple can facilitate that cheaply, instantly and securely, I'm all for that. The usefulness of Ripple doesn't have much to do with bitcoin.

Ripple itself is a distributed P2P exchange. It doesn't have a lot of liquidity yet, but it is a bona fide distributed exchange. That addresses one of the greatest weaknesses of the bitcoin ecosystem. But it *helps* Bitcoin in that respect, because it allows you to trade between bitcoin and any other currency.


It's a matter of robustness of the ecosystem and resilience against repression.

It's pretty confusing though.  I can't do anything on my account because I don't have any credit. I can't buy any credit either... Someone needs to trust me before I can do anything... Seems limited to me.

No one needs to trust you, but you could decide to trust a gateway. Do bear in mind that this really means trust, it means you are willing to make payments on behalf on others in exchange for IOUs issued by that gateway. Don't establish a trust line that is higher than you trust them to repay you or than you're willing to lose. You'll likely want to trust them for a lot less than your bank.

The implementation you are talking about is centralized. I am doing a completely decentralized version with payments with only localized information about users and thus, a high level of anonymity:
https://bitcointalk.org/index.php?topic=295930.0 (https://bitcointalk.org/index.php?topic=295930.0)
Also no gateways and pre-mined currency

In fact we should stop calling the principle of trust chains Ripple, because Ripple is just Hawala by another name and Hawala is at least 1000 years older. The only real difference to Hawala is that Ripple uses computers.

No it isn't. It's a peer to peer network, both the client and server are open source, anyone can run a validator, anyone can choose the set of validators they want to synchronise with and anyone can act as a gateway, either professionally or informally between trusted associates.

more like a potential scammer to scammer network no? You trust me to trust them and together we will rip everyone else off.

You can only rip off people that have granted you a trust line. Trust equals revolving credit and credit entails credit risk. It's no different than with parking money at a bank or exchange. If the counterparty steals your money, or has his server hacked, you're out of luck. This is the same thing as with TF and inputs.io.

With traditional exchanges you open an account and incur risk whenever you deposit money with that exchange. In Ripple, generating an account doesn't create risk, just as it doesn't with Bitcoin, because there isn't a counterparty, there's the distributed ledger instead. The thing that creates risk is establishing a trust line, which is very similar to opening an account at the counterparty's private little bank.

And difference between trusting BTX exchanges is?

is there any chinese Bitcoin exchange which supports ripple?

There are Chinese gateways, not sure if they are classic BTC exchanges too.

I was interested in obtaining some XRP, but apparently that is incredibly difficult. Every site I tried either wasn't currently processing anything or gave me an error even though I filled out everything correctly. Can anyone direct me to a site that actually works for buying them, because I really don't feel like begging people on ripple forums for 100XRP. Thanks in advance.

bitstamp. i think you can still just go to buy / sell > buy ripples and fund a wallet that way.

Ripple seems to be so slow in launching, I really wonder if it can be a threat to Bitcoin at all

Ripple is not a competitor, it competes on the same ground as Paypal or OKPAY, and this post should be moved elsewhere.

It says they have no ripples available.

I do not think Ripple is a Ponzi scheme. People who don't understand say the same thing about bitcoin. In fact if one more person calls Bitcoin a ponzi scheme I think I might smash their face in with the dictionary so they can review the definition of ponzi scheme via the imprint on their face... but anywaaayyyy - I am not be a big ripple fan (I should say XRP fan) but I don't see it as competition for bitcoin. I see more of a compliment to bitcoin, another ally in the war against (traditional) banks and needless merchant fees. Some interesting payment systems would theoretically be designed on top of ripple, which would operate much more efficiently than what we have now, especially internationally. Paying $40 for a wire transfer needs to be a thing of the past. Now.

I can transfer a whole god damn 1080p movie (20,000,000 kb) to someone on the other side of the globe in no time for nearly no cost. Mind telling exactly why it costs $40 and takes 3-5 days to send any amount of money (an instruction to modify a SINGLE NUMBER somewhere.... mere bytes)? It's bullshit with current technology - time to move on, and hopefully bitcoin and ripple can make that happen.

Edit:
In other words, I see ripple as a tool to support the movement of existing (Current and future) currencies, fiat, crypto, whatever. Ideally, I'd love to see everyone using bitcoin. But if that wet dream doesn't happen, I can settle with paying fiat for things using a ripple based network as long as the 2.75% for nothing bank fees do not apply.

The main difference is that people who have trusted different exchanges can still make payments to each other.

A secondary difference is that the exchanges can't as easily target a single customer. If an exchange decides it won't let you specifically withdraw for some reason, you are pretty much stuck. If a Ripple gateway does the same thing, you can just trade your assets at that exchange for assets issued by a gateway that will let you withdraw. You can move funds into or out of a gateway without needing that gateway to perform each operation or subjecting it to arbitrary and unpredictable rules.

If you hold Bitstamp assets on Ripple and decide that for some reason you don't want to hold them anymore, you can sell them for XRP immediately without having to ask Bitstamp to perform the transfer.

The main thing is if I trust Bitstamp to do my BTC business on it, I trust them to do my Ripple stuff. I don't care about philosophizing with tech terms and such bullshit who trust who, bla-bla-bla...

Bitcoin enthusiasts should be last in line to preach about security, trust and similar stuff with robberies and hacks happening daily in their industry.

I think that's pretty much going to be the view of Ripple as more infrastructure comes online.  Most people will never even know they are using Ripple and won't care that it is powered by Ripple.  Just like people use websites and don't know and don't care they are powered by Wordpress.  Or as has been repeated constantly, email and SMTP.  People don't care how it works, just that it does.  That's the beautiful thing about Ripple, it's a true protocol that can operate completely transparently. People know the weaknesses of Bitcoin and it scares them because just as Erik V. said, "the only thing that can kill Bitcoin, is a superior currency" and they worry that Ripple will provide that.  So fear, causes them to miss that which is amazing about Ripple as a payment network and distributed exchange and more importantly the benefits it provides to Bitcoin, by making up for many of it's weaknesses.  

It can operate transparently until someone with too much trust defaults.  If all the people who trusted them can't back up the defaulter's debts, said default will "ripple" and likely knock quite a few decent people off of the network.

Yeah, I was always thinking that Ripple is centralized and thus easily controlled.

What you've said is no different than any Bitcoin exchange, so I fail to see how this is a relevant point.  In fact, how many recent stories of Bitcoin defaults and disappearances do we have?  I see 2 right now on the front page of Coindesk.com.  And let's not forget Tradefortress, Mr. RippleScam himself, who turned out to be the scammer after all.  

I think many people's opposition to Ripple is they simply don't understand debt or IOU's.  They run to put money on exchanges and then bash Ripple.  They cheer at the mere thought of Paypal accepting Bitcoin but bash Ripple.  Ignorance at it's finest and that is understandable.  New financial tech that requires people take control of their own finances does need to come with a certain amount of education.  Maybe it's fairer to say, Ripple hasen't been the best at educating people beyond tech, but then the same also holds true for Bitcoin.

These Ripple advocates are relentless, they keep talking around the main stupid premise: you're trading obligations, not the real thing. And there's no point in them addressing this issue, because the whole system is based around it. The system is IOU based.

Complete
Waste
Of
Time

That's why I don't keep significant assets on exchanges or in third party wallets of any sort.  IOU != underlying asset and Ripple does its best to sweep that under the rug.  For bitcoin, being able to hold the underlying asset directly is one of the main selling points.

What is the point of XRP then?

XRP is the only way RippleLabs will win money so they have to have an utility.

Thats the problem.  The "masses" don't have a clue about the difference between Ripple and Bitcoin.  All they will see is that Ripple never had crime associated with it, the government and banks love it and support it, and unlike Bitcoin, ripple hasn't been hacked to the tune of millions of dollars every 3 months...  Ripple adoption is going to be big because the masses don't know the difference.  Ripple annoys the sh*t out of me.  Many people make money off the ignorance of the general public... Ripple will be that company.   If any hackers out there want Bitcoin to succeed, stop f*cking with bitcoin wallets and start hacking Ripple instead.

What really annoys me is Ripple proponents trying to hang around these forums and buddy up with Bitcoin enthusiasts.  Even argue with them (above).  Why are you here?  To ride coat tails?  Ripple guys - you are not the same thing.  You are, if anything, a competing technology in my opinion.  One that is going to profit off the ignorance of the public.  We are not in the same camp, and I don't know why some of you guys are hanging out here posting honestly.  :)

Actually, Ripple addresses the issue head on.  It wasn't until Ripple folks started explaining IOU's, where many started referring to Gox USD and BTC as IOU's.  Once withdrawals became an issues, the concept finally made sense.  Well, kind of.  ::) Look, for people that have no desire to use any other currency than Bitcoin, Ripple is of no use to you.  For the rest of the world (99.9999% of the population) Ripple is a tremendous advantage.  I can still store crypto with no counter party risk (well, its digital so it will never be completely without counter-party risk) but when I'm ready to pay someone, I can do so with total flexibility.  I'm not forced to stick with one currency and that is more in line with reality, as it relates to the future of world transactions.  So, Bitcoin as the "One World Currency folks",might as well stop responding to Ripple threads.  We don't agree and will never agree.   8)

IOUs are actually one of Ripple's strengths. The point is not that IOUs are better than crypto, the point is that Ripple has both IOUs and a cryptocurrency built into one system, whereas Bitcoin has only crypto. Right now, that is one of Bitcoin's major problems. And as if that weren't enough, Ripple also has a built-in fully distributed exchange, another weak point of Bitcoin. People are working on solutions to that, but for Ripple it's built-in. But it gets better: the IOU and exchange functionality can also be used for Bitcoin!

99 Billion of 100 Billion is a fraction?

For the peons that have been given minute amounts and the "friends" of Ripple that have been given millions, the exchange rate is currently 40,000/BTC. That's the equivalent of saying that there is a legitimate reason for the company's premined XRP to be worth $900,000,000, which is ludicrous.

Even if Satoshi were to emerge and dump all his coins, there are book orders on exchanges wanting to buy several times more bitcoins than will ever exist. Bitcoin has value that cannot be diluted, Ripple has value only until Ripple the company decides to dilute it.

If one cross breeds Banking with Bitcoin one gets Ripple.

I would say when you cross breed everything about the money you get Ripple.

One thing I don't understand about Ripple is why they didn't make their currency more scarce. It's a big psychological point and being scarce is huge bitcoin selling point, most of the people I introduced with BTC have been mostly attracted with Bitcoin limited supply.

We don't really want speculative demand. It just makes price unstable and increases holding risk which makes a currency less useful as a means of exchange. Our goal was not to create a high-risk, speculative investment vehicle through artificial scarcity. (Not that there's anything wrong with that.)

Hm, could understand that but scarcity is good marketing tool, not sure it's good idea to miss it

For a payment system?

I will try to explain in simple words why Bitcoin and Ripple are complementary tools...

Imagine that Bitcoin becomes widely adopted currency and that you can pay with bitcoin in every store.

Do you see the problem?

Just imagine how long would be a waiting line if every customer waits for a 6 confirmations.

Bitcoin needs a payment system that could send Bitcoins instantaneously and the solution is Ripple.

I hope that you now understand how Ripple could help Bitcoin to reach wide adoption.

Cheers!

Simplicity is always the best method.  +1 ^^

Incorrect. You should really look at the rippled PeerFinder code on github (https://github.com/ripple/rippled/blob/7b6d81d812342b614af0c368fae0a6f3d19351dc/src/ripple/peerfinder/impl/Manager.cpp).

The comments in that file give a brief introduction to the design. You will also notice many commits from Vincent Falco, a veteran of p2p systems back to the gnutella days. He has a good handle on how such systems work in the wild.

Does Ripple offer instant reliable transactions?

That was the primary design goal of the "continuous ledger close" algorithm that Ripple uses.
https://ripple.com/wiki/Continuous_Ledger_Close
The goal is to provide you a cryptographically-signed receipt for a hash that provably includes confirmation of your transaction from a supermajority of the validators you have chosen to use.

Which in non-tech terms means, "yes".   ;D

Agree with this.
Consider the incentives Ripple are setting up.
If a gateway has a bad debt there is NO incentive to write this debt off on the Ripple network, as it will make the gateways IOUs less valuable, making it more difficult for the gateway to service the debt.
If the gateway writes off the debt however, for example by covering the fiat loss at their end, the debt stays in the network forever.
Hey presto - new money!
This can go on for quite some time until Poof! the whole network fails.
Bit like all the current banking disasters.
Also I'm not sure how private gateways will police debt without the authority to bear arms, or without becoming loan sharks.
In which case the gateways will have to be as regulated as legacy banks, with no advantages.

So, what is sacrificed (http://en.wikipedia.org/wiki/CAP_theorem) in Ripple then: Consistency, Availability or Partition tolerance?

Imagine what would happen when some gateways losing communication(unverifiably) to some others...........

Or may be they just think centralization is a better idea

Still don't see the answer.

I fixed my post.

Partition tolerance, of course, the same as Bitcoin.

Imagine what happens when some mining pools lose communication, unverifiably, to some others. You might have six confirmations but on the other side of the partition a conflicting transaction has eight confirmations.

Ripple would be much more vulnerable to this than Bitcoin would because you would need a partition that separates well-connected mining pools for many minutes to cause a problem for Bitcoin. Because of this, Ripple actually needs to detect and deal with partitioning. Which it does, of course.

Won't most day to day transactions not require 6 confirmations anyway?  Why would you need the full 6 or any for that matter for a small quick low cost purchase?  Not saying Ripple won't compliment Bitcoin but I'm not see this as it.

It's hard to predict the future. Right now, zero confirmations is probably fine for in person low cost transactions and one for transactions under $2,000. But the block reward is what's protecting us from the Finney attack. In the future, the block reward might be small compared to the value of a double spend.

No problem at all, as long as the merchants are well connected and see all the blockchains, they can decide if their transaction is in the longest chain , and when to release the goods.

A Ripple merchant would not have such good luck if his trusted validators are disconnected from a bunch he doesn't trust....

This would work if they were directly connected to at least 50% of the hashing power and confirmed that they saw a block from each major mining pool prior to processing transactions in it. I wonder if anyone actually does this.

This is automatic with Ripple. If you don't see validations from a supermajority, you know you are partitioned. There's nothing special you need to do -- it's built in.

He will soon. If his trusted validators are disconnected from the majority, they will report this, and he will know the network is partitioned. (This isn't implemented on the live network yet, it is still being tested. It's needed to support trustless clients.)

Bitcoin sacrifices Consistency (it is eventual one). Partition tolerance can't be applied to Bitcoin coz the blockchain can't be partitioned. The same with Availability, the local copy of blockchain provides 100% availability.

Who is CTO of Ripple? I think he should know better what the answer to CAP issue is.

Hmmm, so instead of work, sheer numbers matter right? Our botnet operating Russian friends will be very pleased I guess...




That is to say when partitioning is not resolved, availability will be gone, so instant transaction is only available as long as most of the major trusted validators on the network are connected to each other, I am not sure if I can call it "reliable".

That's correct. If the majority of validators are not connected to each other, the network is not reliable. It does not pretend to be. The same is more or less true with Bitcoin -- if you're not connected to 51% of the hashing power, you cannot rely on a transaction no matter how many confirmations it has. The difference is that Ripple detects this case.

Ripple is more resistant to a gateway collapsing than bitcoin is. The scenario you were describing is similar to inputs.io's meltdown. It didn't take down btc, and in the case of Ripple anyone could tell how much outstanding debt there was at any instant. And of course,  XRP, like BTC held in your self hosted wallet, is immune against all this. The strength of Ripple lies in the combination of its subsystems. Critics like to pick one, pretend that's all there is, and then point out the flaws of having just that system as if that were criticism of the whole. The truth of the matter is that Ripple can do everything Bitcoin can and much more, all in one package.

No, of course not. You actually have to convince human beings that public keys are controlled by organizations that cannot collude. And all that happens if they do is that the network does not reach consensus and those who betrayed this trust have done so provably with cryptographic signatures. So any trust in them can be removed and the problem solved and the attacker has to start over. Which is better -- an attacker just needs money and can double spend and then the system is broken or an attacker needs to build human trust and then can prevent the network from operating and then the attacker has to start over from scratch?

The same is true of Bitcoin. If you are not reliably connected to 51% of the hashing power, no number of confirmations is sufficient. The difference is, with Ripple it's possible to reliably tell if you are or are not connected.

From http://www.links.org/files/decentralised-currencies.pdf:


Seems that reliability of telling if u r connected is provided via sacrificing of decentralization? Or even worse, users decide themselves and this can lead to fatal consequences.

Right, those are the two extremes, and neither extreme is very good. But there are quite satisfying options in the middle. For example, you can have any number of "authorities" who publish lists of who they think should be in the consensus group and users can select whatever set of such "authorities" they want (or none, but then they are taking upon themselves the obligation to ensure their own reliability). The biggest downside of the consensus process is that it requires more management than proof of work does. As the recent blockchain split proved, proof of work does occasionally require management too.

Consider Bitcoin. You could just use the official distribution and update all the time. But then what if someone slips something bad into the official distribution? And is that decentralized? Or you could maintain the code yourself. But that would take a lot of time. And what if you screw up a fix to a severe vulnerability? That would make you fully independent, but it's not practical.

Most users track official releases because it saves them the trouble of keeping code up to date themselves, evaluating new features, and so on. But Gavin puts out new releases of the code and could, in principle, put out a release that steals everyone's Bitcoins, doubles the block reward, or does anything else he wants. Of course, if Gavin did anything as crazy as the things I suggested above, he'd cease to be an authority immediately. If he isn't responsive to the community and stakeholders, people will stop listening to him. And anyone who wants to maintain a fork of the official code is welcome to and can convince people to follow their code changes instead if they want to.

Of course, if you don't follow official code changes, or do the work yourself of tracking protocol changes and fixing vulnerabilities, or follow someone else doing something comparable, you can be compromised. But there is no "Bitcoin software central authority". When you can have any number of "central authorities" and users are free to choose to become their own such authority if none of the existing authorities meet their requirements, you actually don't have a central authority.

But, of course, you can't just run any code and expect to remain secure.

LOL, what human trust do I need to build? Just validating reasonable transactions from other gateways automatically and being trusted by my bots will make me a gateway that has a say in the "supermajority network consensus" after some time.





There is a very big difference between partitioning between you, a user, and the rest of the network, and  the partitioning of the rest of the network, (especially the major miners), to maintain your connection is way easier than trying to make sure the whole network is well connected, in Bitcoin, only the former case matters, in Ripple, the latter case matters too, or even more, that's why I doubt the claim of "reliable instant transaction" very strongly. Besides, even if my Bitcoin node is completely isolated, it still costs much more to convince me, if I demand to see a sufficient number of confirmations, as long as I remember how many zeros I should expect to see in each newly mined block, a significant hashrate drop by more than 50% is also very detectable, and should make any sensible merchant suspicious. Ripple actually doesn't seem to fare much better on the detection of the former case either: if you don't keep record of every validator which has a long history of honest validations from time to time(kindly enlighten me if you have some better algorithms), you can't detect if the partitioning takes place because the supermajority you are seeing could just be "phantom validators" operated by a botnet, while with Bitcoin, all you need to know is a number: the hashrate.

If people do stupid things, then bad things will happen. The trick is to figure out how not to do stupid things and how to make it easy to avoid doing them. I agree that automatically granting trust is really dumb, and that's why nobody should ever do that.

It's certainly harder for you personally to keep the whole network connected, but you don't have to. Everyone else is trying to do that too. Validators will be chosen for reliable connectivity. It seems very unlikely that having most of the network working almost all of the time will be difficult. It is true that Ripple requires this.

I agree. And the idea that you could get cut off from 51% of the hashing power for long enough to get six confirmations with what's left is *very* unlikely. All it takes it one working link between the two sides, which would only be missing in the event of some major global disaster.

You don't care about validators you don't know. And those validators don't care about validators they don't know. This is the number one scenario everyone knows they have to protect against, so the entire scheme by which validators are chosen will be designed to address exactly this.
https://ripple.com/forum/viewtopic.php?f=1&t=3881&p=19423#p19420

With Bitcoin, you can only statistically infer the hashing power you are seeing over time. You can't directly tell how much of the hashing power you are connected to.

If I don't, what composes that supermajority that confirms that my trusted validators are not disconnected from the network at large?

Each of your trusted validators makes this determination based on their trust list and reports it to you in their validations. So you would need a supermajority of your validators to all see a majority of their validators and still not actually have a simple majority of weighted trust. That would require a very broken topology despite it being the very thing that the humans who choose the topology know that they have to prevent.

Most real world failures will be either nearly complete or nearly empty. Dealing with failures near the 50% mark is the hardest case. For example, Bitcoin has no solution to the case where you consider one or two confirmations sufficient and somehow 60% of the hashing power is cut off from you. One could be added, but it would basically require knowing which mining pools have the hashing power, just as Ripple requires some knowledge of which validators have the weighted trust.

We did design the system to detect these failure cases and become unavailable if reliable operation is impossible. Long before poor topology could cause false confirmations, it would cause poor service, prompting humans to address it.

Ripple carries counter-party risk by form of trusting another person or in fact trusting the actual creators of ripple and their gigantic stash of XRPs.

No thanks.

May as well play in the stock or bond market.

If you mean holding XRP as a store of value, we're not suggesting that anybody do that. What we are suggesting is that people adopt Ripple as a payment system. All we can do with our stash of XRPs is drop the value, which just makes the payment system cheaper.

If you mean the counterparty risk of using a gateway, I agree. If you consider this risk unacceptable for all current gateways, you probably shouldn't use Ripple, at least until there are gateways whose risk level you consider acceptable.

This is the price Ripple pays for permitting transactions with arbitrary assets.

But if I don't get to check the signatures all the way down to the last node in the graph, how can I prevent, let's say, a validator cheats on me saying:"Oh, sorry, I was tricked by some nodes on my trust list as well, so I relayed to you this false information they relayed me about the network being good, I have removed them, don't worry.", so he succssfully double-spends me without getting caught? He may well be innocent as well, this is a unverifiable claim.

A validator can't relay false information. Every message is signed by its originator and validations and proposals are currently flooded. (We have plans to optimize this in the future.)

You are correct that bad things can happen if the majority colludes against you. But that's true of pretty much every system. In Bitcoin, you can be screwed if the majority of hashing power colludes against you. In a Democracy, you can be screwed if the majority of voters decide to pass laws that affect you. The difference is that Ripple lets you choose who you will trust. Yes, someone can build trust and betray you once, but then they have to start all over again.

Interestingly, in the case you gave, they still can't really perform a double spend. All the honest participants will agree with you, and that's all any system can do. Even cash can't protect you against that. Say you hold a dollar bill with a particular serial number. Any group can get together and agree not to accept that bill, by serial number. You can still spend that dollar with anyone not in the dishonest group, but you cannot force the group to accept a dollar bill they choose not to accept.

We all know that the main thing we have to avoid is the case where a majority of trust will be controlled by one entity. So the entire system will be designed to make that as difficult as possible. (See my link upthread.)

So that's what I was saying, I need to check signatures all the way down to possibly the last node in the reachable network to determine if the network is being partitioned, right?

Bitstamp has XRP available now, but holy crap are they charging a huge premium to buy it! BTC at 431, XRP (according to bitcoincharts) at about 43k per bitcoin, but it only offers me about 33k XRP for the USD equivalent of the current price of a bitcoin.

You can get as complex or as simple as you like. If you want to be really lazy, you can just pick a few entities that you know are very unlikely to collude against you and just check if they report that the network isn't partitioned in their validations. There's no point in ever checking the signature on a message whose public key isn't already known to you. So the work you have to do goes up with the number of public keys known to you.

With a small network, there aren't that many validators anyway. With a large network, statistical sampling is more reliable, especially since it's automatically two levels. (You are checking whether a supermajority of the validators you trust see a majority of the validators they trust.) We believe the most reliable topology is a hairball, so we're working on schemes that reliably produce them. You also want to avoid too many validators in the same jurisdiction or of the same type of entity (individual, commercial, non-profit, government).

As a student of graph theory I am wondering if you could describe for me what you mean by a "hairball".  A google for "hairball topology" didn't yield anything except this: http://en.wikipedia.org/wiki/Hairy_ball_theorem and I don't think that's what you mean.

Let's get one thing straight here. If RippleLabs were to try and "Do anything they want" with the price of XRP as so many of you like to assert, I would be the happiest man on Earth. Why?

Because I would arbitrage the shit out of every single one of their trades and have the single biggest payday that I have or ever will have, in my life.

To top it off, the value of XRP probably wouldn't end up much different than it was originally.

In order to do "anything they want" with XRP, they would have to own a significant amount of every major currency with a strong market against XRP and simultaneously buy and sell these currencies with XRP in order to get the price to stick. But, they wouldn't want to do that because it would entail changing a significant portion of their XRP balance into another currency which in turn would make the XRP price manipulation less worth doing.

 Price manipulation would cost them far more than it would ever earn them and they know it. They aren't stupid people.

http://hiveplot.net/img/hiveplot-needs-visualization.png

http://hiveplot.net/


He probably just means supernodes not wanted. It will be interesting to see these schemes fighting against preferential attachment (if I understood rightly). I was under the impression it was accepted as being everywhere when it came to social networks.

It is almost always cheaper to buy XRP on the Ripple internal market than through a broker like Bitstamp. You just need the initial amount (a few cents) from them, after that you can withdraw funds to Ripple and trade with your balance there.

So just get a couple dollars worth to get the required 100 XRP, and then I will be able to buy more on the actual site?

Correct. Just get enough to fund your account.

Sorry for being retarded but what should I do to get a couple of dollar on my Ripple wallet?

I seem i can only fund it via my Ripple address.

You're not retarded nor do you need apologize.  It was new to us all once.  

I seem to remember I sent $1 or so worth of BTC to my Bitstamp account.  Bought XRP and funded my Ripple account.  Then I could move BTC or USD to and from my Ripple wallet and buy XRP from within the Ripple client at MUCH better rates.

They have enough XRP to buy out every ask on every asset.  Not that I think they would, but they could.  If they did, XRP would be worthless.  How exactly are you going to "arbitrage the shit out of" that?  Are you going to sell all your assets at the new high price for the worthless XRP?

The ripple guys should just go to an exchange and buy some Gold 2.0 with their premined 10^256 ripples :)

Actually, when I checked it the other day, it did appear to have plenty of liquidity. The reason it doesn't look that way is because most of the liquidity is against XRP. If I understand things correctly, Ripple will synthesise a virtual order book from order books in various currency pairs. If the order books in A/B and B/C allow a conversion A -> B -> C at a better price than the order book in A/C, Ripple will choose that route. The standard web client appears not to show such virtual entries though, making it look as if there is hardly any liquidity when in fact there's plenty. Usually B=XRP, since it is the only currency that doesn't require IOUs and therefore doesn't have counterparty risk (and / or identification issues).

Nxt will be launched soon. With its decentralized exchange it allows to create gateways like Ripple.

The more the merrier!

So there's Nxt (https://bitcointalk.org/index.php?topic=303898.0), MasterCoin, BitShares (or is it ProtoShares?), eMunie, Open Transactions, all of which are supposedly going to be launched/released soon (any others?). It is very easy to market vaporware - just claim that your product has feature X, and it does. Since its just vaporware it can have all the best features before it even exists.

Ripple, on the other hand, actually exists and already has one major gateway (kraken next in line) and two chinese gateways (with rising CNY capitalization btw, up from 250k CNY in october to 539k CNY on Nov 12th to 787k CNY today).

The competition hasn't even left the starting line.

Which chinese gateways?

Nxt does exist (http://88.198.210.245:7875/).

I mean exist as an actual product that people can use. That's more like a concept mock-up. Colored Coins did that two years ago (http://bitcoinx.github.io/webcoinx/). Where is colored coins now? Well, the original client developer, Stefan Thomas, moved on to become Ripple CTO.

www.rippleChina.net and www.rippleCN.com

If anyone wants to implement my original 2-phase-commit/non-blockchain Ripple protocol design, it's here:

http://archive.ripple-project.org/Protocol/Protocol

It's only based on IOUs and routing through a mutual credit network -- no trustless cryptocurrency involved.  And you'd need to give it a different name, of course :)

Nxt is launched in a couple of days. I'll come here later to post when people will be using it.

Actually a company having the power to exclusively pre-mine a currency and then "lend it" to people is a indeed a big problem, it solves NOTHING and only creates another debt-based economy and only benefits the very few who own ripple.

Ripple just fuels to cycle of crony capitalism (which is why banks are loving it). Bitcoin on the other hand creates real free markets where you actually own your money/savings and every individual has a chance to prosper, depending on how much risk and work each individual decides to take.

I do not understand why people are so much focused on the pre-mined xrp's, especially when a proportion of BTC itself was pre-mined too. Actually Ripple IS solving the problem of double spending trough consensus which is way faster and convenient then BTC's PoW.

If you strongly believe it benefits the very few who owns them, why don't you buy these cheap coins. BTC's were not for free either, people do forget this, with mining you spend your time, expensive hardware, electricity...

Let's say you are a hardcore miner, then I'd suggest you to have a look at https://www.ripplelabs-wcgxrp.com/ . In stead of wasting computer power, this way you contribute to science and get xrp's.

If for any reason, you do not want the gateway specific currency (xrp), you still can use the gateway which is not in any case a competitor to BTC. Its main goal is to accelerate the money transactions and for free, including BTC.  

Most people do not know what Ripple and xrp is. If you are interested, check these documents:

https://ripple.com/ripple_primer.pdf
https://ripple.com/ripple-gateways.pdf
  
    

Ripple and XRP for that matter, is actually NOTHING like our current "debt based" system.  In order to have a "debt based" system, the currency would have to be created using...wait for it...debt.  USD for instance, enters the monetary system as debt.  No such debt exists in Ripple, as it relates to XRP, thus XRP is an asset on the balance sheet of anyone who holds it.  Which in turn means the rest of your rant is poo poo.   ;D  

Banks love it because it's a payment network that is leaps and bounds ahead of Bitcoin and certainly their own.  Ripple is also not just a single currency like Bitcoin, which by itself does little to solve our monetary problems, other than allowing people to bypass government fiat.  It still leaves the current system intact.  Regulators like Ripple because it's designed to be transparent, so tracking transactions is significantly easier.  

Typically, the only people intimidated by Ripple, are those who don't understand Ripple and often only care about the value of their Bitcoin being negatively affected, not the bigger picture of solving our global monetary challenges.  I personally think Ripple is going to have a positive effect on BTC values by allowing off blockchain transactions in mass, but when it comes down to it, who really cares what you think?   ::)

A myth about BTC is that it is untraceable and being anonymous. It might have been but as BTC is coming closer and closer to the mass, it is getting more and more traceable. Nowadays every exchange system demands accounts to be verified. See also: http://bitcoin.org/en/faq#is-bitcoin-anonymous or to summarize

Something I don't understand with Ripple:

When I log in my Ripple wallet I have 44,000 XRP. But when I try to make a deposit with Ripple at Bitstamp or Justcoin my balance show only 1,000 XRP and I can only deposit this 1,000 XRP. Why ?

I'm not sure I understood your question but could it be the trust line?

It could very well be that because I have no idea what is the trust line. What it is ?

And what should I do to be able to deposit my 44,000 XRP at Bitstamp ?

XRP doesn't require any trust lines.  That's one of the things that makes it special within the network.  Bitstamp doesn't allow XRP deposits and honestly why would you?  Storing your XRP in your Ripple wallet is how you store it, without counter-party risk.  If you want to sell or buy XRP, you simply need go to the trade section of the client and change your issuer to Bitstamp or whomever you choose, for the specific currency pairs you're interested in.  That will give you access to their orderbook.

Why do you keep spamming thread of completely unrelated product? I´d wish for you to find less annoying ways of propagating your work.

To show better alternative.

That doesn't make any sense. Bitstamp doesn't take or hold XRP deposits. Why would they? What are you trying to do?

I just don't see it working out for the regular Joe.

There is some recurring issues were USD is not fungible, so you can't sell your USD at other gateways without taking a big haircut.  I'm not sure if that has to do with trust lines between gateways or what but you just get these lame error messages.

And in some cases you pay between 5 to 10% or more to move fiat that is being held at one gateway to another.  So if I moved fiat from a gatewaye in the USA to a gateway for Brazil, I get to pay a whopping 10%?

I might as well go to Western Union and talk to a real person.  Or just use Bitcoin.

It was a cool idea, but just doesn't seem to be working out as well as people thought.  Perhaps if they could fix these issues things would be okay but people have been posting about them on github for months now.

Just my 2 cents.

Just out of curiosity, is it even possible to create XRP IOUs? I know the client doesn't support it, but what about the server? Could you run a community credit scheme with XRP?

To avoid confusion the server does not allow XRP IOUs. XRR is suggested for XRP as IOUs.

Thanks!

Assuming both gateways are reliable, this is a profit opportunity. If the cost is unreasonably high, offer the exchange at a less unreasonably high fee.

Again, if the price is unfair, offer the movement at a lower fee. These are market rates. You are absolutely right that the markets are thin right now, but those are profit opportunities for market makers.

We're working on incentivizing market makers. But any time you see an unreasonably high price in Ripple, offer the same thing at a reasonably high price. You'll make a profit and you'll make Ripple better too.

If you think of Open-Transactions as a competitor to Ripple, then you are misinformed. That's like calling openssl a competitor to Excel.

Also, OT has been publicly available for a long time: https://github.com/FellowTraveler/Open-Transactions

Okay then, I should have said Invictus Innovations, Monetas, and Ripple Labs.

I know OT has been available, and you're right that its not a fair comparison to Ripple. Because OT is an API around Chaumian cash/Lucre coins. The p2p exchange is a "feature" which exists only on the roadmap, and in various proposals for a "holy grail" bitmessage-based exchange and multi-sig voting pools.

Then there's Ripple, which already has a distributed ledger and is constantly matching bid/ask offers every few seconds. Pretty good volume today, users were trading $1k chunks of bitstamp USD for XRP. And deposits at the chinese gateways broke the CNY 1,000,000 mark.

Let me ask you, why should anyone use Bitcoin, when they can just use Paypal?

-- Paypal is in many countries.

-- Paypal has a worldwide ledger tracking everyone's account balance.

-- Paypal allows you to convert into other currencies.  https://www.paypal.com/cgi-bin/webscr?cmd=p/sell/mc/mc_convert-outside

-- Paypal allows you to receive money in many different currencies.  https://www.paypal.com/cgi-bin/webscr?cmd=p/sell/mc/mc_receive-outside

-- Paypal processes over $315 million in payments every day. (Pretty good volume.)

-- Users often trade $1K chunks of USD for Paypal USD.

-- Paypal is in China.  https://cms.paypal.com/c2/cgi-bin/marketingweb?cmd=_render-content&content_ID=marketing_c2/CNPayPalComparison&locale.x=zh_XC

---------------------------------------------------------------

What you do not understand is that Open-Transactions is a software library, like OpenSSL.

Calling OT a competitor to Ripple is like calling OpenSSL a competitor to Ripple.

We are talking about a software library... libraries are used by many different entities, for many different purposes.

Libraries are not in competition with any companies.

Companies are not in competition with any libraries.

Libraries are used to build things.

---------------------------------------------------------------

It is not my intention to sit here talking about Ripple, nor to badmouth them in any way. They are adding value to the digital finance space.

In fact I like the Ripple guys, and I love Fugger's concept.

I like it so much, that I wrote extensively about it in early 2012, in this document I shared with them back then: http://ft.vm.to/files/FT-thoughts.pdf

I hope they succeed! The same goes for Invictus Innovations, colored coins, Mastercoin, and a million other ventures. My goal here is to spread concepts and code, and to promote all entities who innovate in the digital finance space. May they succeed.

I do not have a poverty mentality, but an abundance mentality. I do not have an either/or mentality, but an integration mentality.

---------------------------------------------------------------

Open-Transactions is a fundamentally different thing.

-- If you have an "account balance" in OT, it is impossible for anyone except the user himself to change that balance. Is Ripple competing with OT on that concept?

-- If you have a balance on any OT server, the server will never need to send/receive any bank wires in any currency, nor maintain any bank accounts. Is Ripple competing with OT on that concept?

-- In Ripple, you trust your gateway to store any dollar reserves. But in OT, your client would access many servers, yet none of them store any reserves at all.

-- If you want to build software enabling various financial instruments (cheques, cash, dividends, stocks, basket currencies, smart contracts, recurring payments) then you could use OT to build it. For example, for making printed vouchers, or parking garage tickets, then you could use OT to build it. You could use OT for escrow with arbitration. You could send an OT payment to someone who has never installed OT. Is Ripple competing with OT on those concepts?

-- Ripple has a distributed order book. But in OT, the "order book" exists on the client-side. It's the client in OT that combines various order sources into a single book. OT is client-centric.

-- In Ripple, the ledger chain stores all transactions. But OT processes transactions without storing any history.

-- You are correct that OT also does Chaumian blinding, but to characterize it as a "blinding API" would be woefully inadequate.


===> These are not value-judgments. I am simply pointing out that you are comparing Apples and Oranges. Ripple is cool stuff, but it is not an alternative to OT. It has different goals, a different design philosophy, different functionality, and different uses based on different solutions. These things are not "either/or."

===> BTW, you seem to believe the "holy grail" is vaporware. But if you check the bounty thread, you can see fast progress is being made. Expect to see more updates in the coming days and weeks.

I've not had the mental bandwidth to follow the Ripple-against-the-world discussions as of late. However, I find it somewhat puzzling that the above comment went utterly unresponded to.

Perhaps I am just being trolled.

Yes, it is somewhat puzzling. I wish I had something to say, but I'd have to read the original design. Maybe call it FuggerCoin? or MutualTrustTokens?  :P

I just can't get excited by a design/spec without an implementation. I'll stick with XRP for now, which is pushing 80 XRP/USD at the moment, led by dumping of CNY (gateway cap surged from CNY 1 million to CNY 1.4 million overnight).

66xrp/USD now in western gateways  :) in China it´s closer to 50xrp/USD.

EDIT: I know, I am coming late to the party in the year of 2017, but finally we can all agree the XRP is not the future of cryptocurrency for value holders. Paradoxically, because it is way too stable, making it not so attractive for speculators. Also, it is not really anonymous. Sad story, bro.

Wow XRP broke the all-time-high. CNY gateway cap over CNY 2,000,000 and USD gateway cap over $1,000,000. record-breaking day  ;D ;D

What all time high is being referred to? Spent on XRP? Traded? Volume?

XRP price, it peaked at 30 to the dollar (or $0.0333 per XRP). The old high was 50 to the dollar ($0.02), which hasn't been seen since June. The wall is building up at 38 now though, so I guess we'll get some consolidation now...

Could be China.
Could be the fact that all Crypto's are making money now.
I poured a whopping $119 into Devcoin several months ago and purchased 2.5 million of them.
As of today, on a coin I thought could never appreciate in value, I've made $352 now.
If even Devcoin (unlimited coins, zero scarcity, etc) is going up, maybe it makes sense that Ripple will start too.

Update: some whale seems to be chopping down the wall. It was $100k (over 4 million XRP) at 38. Continuous buying has cut it down to $23k now (874k XRP). A fraction of its former size.

https://i.imgur.com/a6bRW06.png

this is crazy.  but as long as you can make money trading xrp, why not?  right?  bitcoin was nothing a few years ago...  ripple could be something big too.

Others considered me borderline insane for thinking that ripple will break new ATH before Christmas. I still sold out at 42xrp/USD, tripling of price in a week was just uncomfortable for me  :) still, more power to ripple.

I want to buy some XBT with my XRP.

Thanks but how do I change the issuer to Bitstamp?
When I try to write "Bitstamp" it's written "not a valid adress or contact"

All the alts are flying at the moment though.  I like crypto but can't get my head around ripple.

You need to fill in Bitstamp's Ripple address which is rvYAfWj5gh67oV6fW32ZzP3Aw4Eubs59B

You're right, it's getting very difficult to differ the real valuables from the noise. While there is a tsunami going on, you won't think but run for your life. It's only thereafter, when the water retraces, the dirt and the ravage will be visible

You should give ripple a try before...     

Again a lot of people here seem to confuse "Ripple" (the distributed exchange) with "Ripples" (XRP, the native asset on Ripple).

When you "invest" in the latter, be aware that there are many times more than there are currently available to the public still waiting to be distributed, often for free or only minimal amount of work. This is very different to a lot of alternative currencies that are being distributed via PoW or PoS.

So I have traded XRP to BTC and now I have 1 BTC on my Ripple wallet. It is a BTC.IOU or a real BTC? Is there any third party risk with keeping that BTC in my Ripple wallet?

ok, so ripple is crap, good to know.

Yes, there is absolutely counter-party risk.  You are trusting your gateway (issuer) to hold your BTC.  They issue you an IOU of that asset to utilize within the Ripple Network.  To remove counter-party risk, withdrawal your BTC back to your own BTC wallet.

boy o boy, who is ready to dump ripple for some good old JPscamCoin?

This is why I believe Ripple has the potential to hugely backfire. Imagine if multiple trusted gateways go byzantine and behave badly, possibly in a network partition situation. Fast transactions means the potential for large divergence if things do screw up.

Thanks.

And does the XRP in my Ripple wallet are also subject to counter-party risk or does this risk only exist with other currencies?

XRP is the only currency, within the Ripple Network, with no counter-party risk. 

It's no different than with Bitcoin or any alt, and their respective exchanges.  Same risks.  Bitstamp, which is obviously a BTC exchange, is also the largest Ripple gateway.  Anytime you deal with an exchange, gateway or even a bank, you take risks.  The only way to be certain, is to never remove your assets from your personal wallets. 

OK.

And is it possible to deposit fiat inside my Ripple wallet with my bank account?

You have to deposit with your gateway (issuer), so it depends on what deposit options they offer.  Three I know of are:

Bitstamp (Recommended)
SnapSwap
PeerCover

What I do, is use Coinbase to buy BTC -> Bitstamp -> Ripple.  Reverse to get back out into fiat.

I think I'm taking this a bit off topic but what exactly is then the point of having a "de-centralized" exchange ? Either Ripple scales well for arbitrary trusted gateways in which case it does add a valid service or all you are doing is running additional ripple software on existing exchanges at the benefit of those who hold XRP.
If you rely only on a hand full of gateways ripple adds virtually no advantage, on the contrary you now have to trust both the gateways and the software itself to work as expected

http://ripplescam.org/

'Nuff Said

Agreed.
The system incentivises lying and hiding bad debt until eventually multiple gateways blow up, just like the current financial crisis.

Hundreds if not thousands of gateways, to my understanding, is the goal.  

One of the advantages of the distributed exchange, is to allow payments from any currency, to any currency.  The network will find the best path by utilizing this distributed exchange.  
Gateways are also advantageous over exchanges, because their Ripple transactions are all listed in the public ledger.  So at anytime, you can see how many IOU's are outstanding and how much cash reserves the gateway should have.  Good luck getting that from an exchange or bank.  

XRP is advantageous because it can be stored with no counter-party risk and can move through the network, without trust lines.  It can also move into or out of any currency on the network and is known as a bridge currency.  

Let's say you're going to send me payment, which I require in EUR but you want to spend BTC.  It's tough to convert BTC - > EUR and then send it to me, without Ripple.  Takes a long time and it's expensive.  With Ripple you can for instance:

You -> BTC -> XRP -> EUR -> Me

That would be one possible path through the distributed exchange.  And it all happens in seconds, for a fraction of a penny. 

If you're a person, who in the future only plans to deal in Bitcoin transactions, Ripple is of no use to you.  If you're a person that plans to deal in multiple fiat and crypto-currencies, Ripple is an amazing payment network.  

More info here:  http://en.wikipedia.org/wiki/Ripple_(monetary_system)

What are the incentives for an exchange or a bank to become a gateway ?

Well, there is no one answer to that.  One of mine, is a gateways ability to capture spreads, making markets for various currencies.  So there are tremendous monetary benefits.
The potential advantage to consumers is even more tremendous, as "Powered by Ripple", should drastically reduce remittence costs and reduce wait times.

The primary one is transfer fees. Every time an asset they issue changes hands inside the Ripple network, the gateway can charge a fee. Bitstamp, for example, charges 20 basis points ($2 per $1000). The net effect is that a gateway's outstanding obligations shrink without them having to do anything. This applies to any transaction made possible by the liquidity the gateway provides, such as cross-currency payments.

Gateways can also charge for any services they provide. This includes deposit fees, withdrawal fees, or even a monthly account maintenance fee if they want. In the future, when interest rates return to more normal levels, a fractional reserve gateway could draw revenue from interest on funds they hold.

https://ripple.com/ripple-gateways.pdf

It would be dishonest if I didn't admit that I have not looked at the actual consensus code in the protocol, but I do know my way around distributed consensus.
Their website gleams with technicalities on IOU's etc but when it comes to how they are reaching consensus the air gets mighty thin.

This is not trivial, in fact it is the essence if Ripple can and will succeed. The way I understand it you have a set of trusted nodes which need to form a majority.

Depending on synchrony assumptions and message creation times I am very much inclined to believe that Ripple will need more than three times (3f+1) as many honest and correct nodes to avoid byzantine attacks.
Now what about network partitioning in the wake of failures? If you have a system with known participants all trying to agree on something you will need a total majority to ensure consensus, else you'll end up with two network partitions both possibly containing different versions of your lovely distributed ledger. With Bitcoin the average block creation time is around 10 minutes which should give enough time even if a major outage occurs to somehow route information to the other partition. When you are doing transactions in seconds time even a short failure of an important connection (undersea cable is cut etc) may cause a network partition. Now what do you do? let the minority partition wait until it is re-joined?

I am very sceptical about ripple because a) It is complex and complex systems are more prone to contain errors and b) the technical problems are very very far from trivial
Solving this on a medium scale system (several  exchange nodes) may work (look at Group Communication or atomic broadcast algorithms, they solve consensus in such instances)
But thousands of nodes? I am VERY doubtful

It would be great to see this solved and perfectly running as the software would then be usable for MANY other applications that require fast distributed consensus


[edit] ok I found the Consensus entry on the wiki, Complicated (who would have thought) Does anyone know if there is a whitepaper / formal proof of correctness? [/edit]

Eh, that's TradeFortress' anti-Ripple propaganda site. Enough said.

The only attack that would be possible is a denial of service attack though -- causing the network to not reach consensus. And since each node signs all of its proposals with the key by which it's known, it should be obvious which nodes to stop trusting. So to launch this attack, someone goes to all this trouble to build human trust, they maybe stop consensus for some period of time, but then they lose all that trust and have to start over. It seems unlikely anyone would bother.

Correct, but everyone will know the network is partitioned because they won't see the validations and proposals they're expecting. A key Ripple concept is this -- if conditions make it such that reliable operation is impossible, don't pretend that everything is fine.

Exactly. So you get quicker absolute confirmation unless conditions are such that this is not possible. In that case, you don't get quick confirmations, but at least you don't get confirmations that don't actually confirm anything. If Bitcoin has an extended split with mining power on both sides (as it did during the blockchain split), both sides will think they everything is perfectly fine and will see confirmations that appear perfectly normal in all respects.

Agreed. Ripple is more complex than Bitcoin, has a larger attack surface, and has not had as long to prove itself.

Actually, the more nodes, the easier. It does take a bit longer, the consensus time goes up with the log of the number of participants you need to encompass most of the weighted trust, but it's much more robust.

Unfortunately, I'm not sure how useful our consensus algorithm would be for other classes of problems. It might be, but it might not be. We get a lot of simplifications from the fact that we were able to structure the problem we needed to solve specifically to make it easy to solve. For example, all a consensus is really established on is which transactions are going to go in a particular set. If two transactions conflict, to avoid a double spend, you just need to agree which comes first (most of which you can do with a deterministic rule). We've removed a lot of the double spend problem by the design of the ledger and transaction mechanics.

For each transaction any node has seen during a ledger window, the network need only come to consensus on whether or not to try to apply it, and can implicitly agree not to apply it simply by failing to agree to apply it. Everything else is handled by deterministic rules known to all nodes.

This is surprisingly simple because:

1) If there is absolutely no conceivable reason why the transaction should not be included, every honest node will agree to include it.

2) If there is some reason why the transaction should not be included, there is no harm in not including it. (If it's valid, every honest node will see no conceivable reason not to include it in the next round anyway.)

And it doesn't matter if invalid or conflicting transactions get agreed on. The deterministic rules will ensure valid results regardless of which transactions are included or when.

I still do not get why they have Ripples other than to just try to get some extra money. The whole thing seems like a big marketing scam. Eventually there may just be Ripple the exchange? They will succeed because of this whole Ripple garbage? That said I do own some because I blindly went in and bought the hype.

Maybe Im just not understanding it? Bitcoins make sense because of the mining. Maybe ripples are what dollars are to gold? Why not just stay with the dollar then?

Is there is a Ripple White Paper?

There are three main reasons:

1) XRP funds transactions and ledger entries as a means to control spam. For technical reasons, the only currently practical alternative to proof of work is a native crypto-currency built into the system. The problem with proof of work is that attackers will always have advantages over defenders -- attackers can optimize their hardware to do proof of work while legitimate users have to use whatever they have, such as a mobile device.

2) XRP serves as a "lubricant" to improve liquidity. When introducing a new currency into the system, the easiest way to make it liquid is to place offers to exchange it for a currency that's already liquid. Any currency but a crypto-currency in its native environment will have counter-party risk and is likely to be regional. That makes it less suitable for this "universal currency".

3) XRP makes Ripple Labs' business model work, funding the development of Ripple and making giveaways possible both to promote Ripple and to do good. The value produced by Ripple Labs -- the Ripple network, protocol, and software -- belongs to the world, and Ripple Labs neither owns not controls it.

Because Bitcoin uses proof of work to secure the currency, you have a problem in the beginning. When Bitcoin was first introduced, Bitcoins were worth zero and transaction volume was zero. There was no way to use transaction fees to fund the proof of work needed to keep the currency secure. The block reward's technical function is to keep enough proof of work going on to make the currency usable (until transaction fees can take over) by providing a financial incentive. Every dollar that buys mining hardware or goes to an electric company to power mining hardware is one dollar of value the Bitcoin ecosystem created that leaves that ecosystem. The Bitcoin economy has to produce millions of dollars in value a day just to hold the value steady. Mining is Bitcoin's biggest downside, taking much of the value Bitcoin creates and giving it to chip manufacturers and electric companies.

And, unfortunately, it's economically impossible for mining to be a wealth-spreading mechanism to the world at large or to people in need. If mining is more profitable than other things people might do, then mining will increase -- thus so will the difficulty, until it's not more profitable than anything else people can do with the resources they have. It will likely always be a near-break-even proposition, profitable only for those who have especially good deals on hardware or electricity, sucking money out of the Bitcoin economy.

To be clear, I'm not saying Bitcoin is broken in any way. I'm just saying that there's no factual basis for seeing mining as a strength.

If we had created Ripple with mining, Ripple Labs could still have the same amount of XRP holdings today. The difference is that we would have had to raise a lot more money and pay it to electric companies and hardware manufacturers instead of being able to use it to build the team that's developing Ripple. It would mean that instead of being able to give away XRP to do good in the world, it would go to whoever was willing to waste the most electricity mining it, people who would likely barely break even. Bitcoin's early day miners who made large profits generally did no better than people who bought Bitcoins and certainly repeating Bitcoin's early mining success stories is nearly impossible. Ripple doesn't need to incentivize people to provide massive amounts of proof of work.

what does Ripple believe ripples will be worth in a year?

fractional reserve gateways...that's scary....that you have said it lends credence that exchanges are fractional reserve as well....

It certainly can be -- particularly if there's a lack of transparency. In the current economic climate, there's basically no choice but to keep a full reserve. And if you're holding Bitcoins, for the forseeable future there will be no choice.

But, for fiat currencies, that is really only because interest rates are so absurdly low right now. When economic conditions return to normal, it makes sense for gateways to store their fiat reserves in an ultra-low risk, interest-bearing form. It's not that difficult to structure things such that if the ultra-low risk investment somehow fails, the owners lose their capitalization but the customers do not lose their money. This should allow them to charge their customers less and also have more funds to invest in customer service, security, and features that make them more convenient to use.

I don't have a crystal ball though. My prediction of future gateway business models is basically just a guess.

Does this fee for cross-currency payments only apply when you are sending money to a recipient through the rippling system, or also when you explicitly place an order in the order book?

As soon as the moeny is moved, the transfer fee is charged, placing an order can move it (if it is immediately taken) or it can just stay and wait (if you try to sell 1 BTC for 5000 USD for example). In the latter case the transfer fee will apply after it actually moves, if you withdrwa that order in the meantime, nothing is charged (besides some tiny amounts of XRP, as with any transaction).

Interesting. Is this fee just the "quality" setting of the rippling mechanism in action, or is it a separate setting?

It is a separate setting. It's a per-account setting.

Does that mean it only applies to IOU types where the restriction to to verified accounts has been enabled or can all IOUs apply this? I've been looking around on the wiki, but details on this and things like auto bridging are sketchy. I've been toying with the idea of trying to start a gateway that offers EUR IOUs since no one else seems to be doing that in a way that inspires my confidence.

Mods: Doesn't this thread belong with all the other scam coins?

All IOUs can have a transfer fee. The restrictions are that it's a per-account setting and that it must be a ratio of the amount transferred.

Autobridging isn't implemented yet.

Unfortunately, it only sounds good. There's human nature, and when given a choice between good in the world and personal good, we always choose latter, being the greedy monkeys we are. But I'll be glad to be proven wrong, although I know that it's not going to happen.

If we have a currency crises, or liquidity crises to be more specific, Ripple will be the only place to go for any kind of liquidity. I personally dont think economic conditions will normalize. I think the new currencies and networks will take over as a last resort and skyrocket in value regardless of anyones opinion. I think everyone needs to quit overthinking our current economic situation and realize the traditional monetary systems are due for a schumpeter's gale. Watch as history repeats itself, but this time we have the internet. We are about to be thrust into an interesting world soon. Grab some popcorn enjoy the show.