Sorry, I (still) don't get it. This is all quite confusing. I convert send BTC to BTC, why would I need Ripple? Wouldn't the two endpoints would have to be Ripple gateways?

According to B24's operator the German and Polish government froze the accounts. I find it somewhat unbelievable that this coincides with the engine going down, but if these were true, this would be the first government intervention AFAIK.

Okay, I see, this was a hypothetical. I have 10% spread on Bitstamp USD via Ripple, so perhaps I'm missing something. Why are there so few gateways? Making the USD market for 5% - I will do that with a smile 24/7. Bitstamp is doing a decent job. Do they have close connections to Ripple? I must say this Ripple thing is cool, but very opaque.

In the ripple wiki it says it can be used to trade between MtGox and Bitstamp. How? What I see are USD spreads of 10%.

.

Well, is it once per second or once per 1.000001 second? There is currently a stupid debate on high frequency trading for normal exchanges. Problem is, that computers are just better at this stuff. Hence the very natural relation of BTC and automated trading. People trading on the exchanges are mostly liquidity takers. Liquidty providers, provide the service in the form of tighter spreads. Marketmakers and exchanges are both part of the infrastructure. Building the exchange is not enough. So, discouraging bots is the LAST thing at BTC exchange should do. It's a shame that Bitfloor didn't get this right. But the source they published was, well, not up to the task. One needs stuff like volatility interruptions and single timed auctions.

THANKS!

'continued

.... think about it. The more flow comes it, the harder it will get. One thing to show how hard this is: co-location. Once an BTC hopefully gets a certain size, people will start co-locating. Then you have to deal with the question at what time clients get their requests. Currently the state of the art is in 50 microseconds. I have spoken to a guy who works with AMD to build special processors (FPGA) for this stuff. There are perhaps billions invested in trading FX infrastructure, for an armsrace in this space. Billion $ hedgefunds doing 100 trades /sec, with 50 person teams. Compared to this level, MtGox, B24, BTCe, BTCde are a joke. BTCde doesn't even know that you can virtualize servers and that you need an API. Somebody will enter this game and show MtGox how it should be done.

'continued

.... think about it. The more flow comes it, the harder it will get. One thing to show how hard this is: co-location. Once an BTC hopefully gets a certain size, people will start co-locating. Then you have to deal with the question at what time clients get their requests. Currently the state of the art is in 50 microseconds. I have spoken to a guy who works with AMD to build special processors (FPGA) for this stuff. There are perhaps billions invested in trading FX infrastructure, for an armsrace in this space. Billion $ hedgefunds doing 100 trades /sec, with 50 person teams. Compared to this level, MtGox, B24, BTCe, BTCde are a joke. BTCde doesn't even know that you can virtualize servers and that you need an API. Somebody will enter this game and show MtGox how it should be done.

But for that B24 had a pretty decent front end. I doubt this will get "fixed" in 2 weeks, because it is only a question of time until the next bug. And you can't have bugs like that. Failure is not an option here.

Wow, people actually don't have a clue how __hard__ it is to build an exchange? It's not a matter of fixing the bugs. Have you ever wrote an engine which handles 100 simultaneous requests per second with bi-communication? The guy has worked on a file server before. Look at MtGox. 10 people and they can't get it done. And there is a reason why. This stuff is damn hard. You need worldclass hackers for this, who have worked on matching engines before. And some ventures which are being started right now will fail. All exchanges currently are a joke. You need an extremely good team to get this right, and I doubt Max Keiser will get it done.

Is there rough data where BTCs are distributed? I assume that exchange accounts are mostly correlated with BTC holdings. With Google trends one can see that the scope of Bitcoin has broadened in the last few months, but it's still much more searched in the West.

Why would anyone use the system if they keep half the XRPs for themselves?

I thought about something similar, but building an exchange is very hard. If you build the infrastructure why rent it??

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How can ripples be used to trade between exchanges? How do I get started?

Thanks.

To me it look like he's a one-man shop? Amazing. The site was pretty solid though, although building an exchange is not exactly trivial.

Hello,

currently there are several projects underway to create exchanges. I believe it would be good to develop standard for the overview of those exchanges. The modern stock exchanges have standards for the market participants. These rules are evolving and there are many conflicting interests. If no exchange standard are developed and no oversight over the exchanges is practiced, the risk of manipulation is very great. The current major exchange, could in theory make a lot of money by manipulating the market. Shutdown of the exchange suddenly, buy very cheap. Or concrete matching rules which favor one type of order over another. I believe several major players will enter over time, although probably not the DB's, NYSE's, BAT's of the world (the current exchanges). Perhaps Bitcoin will change the exchange market, not just currencies per se.

I think it would be helpful to define new standards which can and should be implemented by the exchanges. Then the exchange is free to implement those rules. Then the community (if there is such a thing) can create some kind of control. For instance consider this: the Winklevosses have bought 10% of the whole market. One major player could corner the market. It is "just" a question of money. Currently the economic forces behind the network are not that great, as compared to "the real world". But this might change, and there are some signs for that. At the moment a lot depends on MtGox. How to build trust in the exchanges? Trust in bitcoin to some degree depends on the exchanges. And I doubt the major institutions will introduces Bitcoin, because they live from the current fiat system. One thing is certain: how all of this will play out will be fascinating to observe.

Please move in the appropriate section.

This is actually one of the core debates in economics, what causes inflation. The Austrians partly believe that banks and the central banks cause economic cycles. While there has been a lot of focus on the malpractice of banks, few realize that banks and central banks are really tied together in one system. The central bank has some status of lender of last resort. Effectively the central banks are now ever increasing the overall risk in the system. Gold is not a hedge, because there is no payment system. If BTC would be considered a hedge on the financial system, and it's capabilities proven the value would indeed be very high. But consider this: nobody says that when that infrastructure is established, that there will not be a Bitcoin 2.0 which will make BTCs less valuable. The value is really in the network and the belief that it is valuable in the future. Currencies are the most natural object of speculation. (Fiat) Money in itself is speculative. (see George Soros, Alchemy of Finance for details).

That's what I was trying to say. If you look at the balance sheet of the Federal, the ECB, the BoJ, the size of the balance sheet is only very loosely correlated with the index value. Inflation is very little understood, because of it's linkage to debt and how it is issued. If Bitcoin is really the next big thing is of course by no means certain. Governments currently, more than ever, depend on the printing press.

Transaction fees paid by whom for whom? The beauty of it is that the fees are self-financing (the cost of electricity). If the incentive is too little no transactions can be made, if the incentive is too high, then the service providers will eat up the benefit. As soon as the services are online there is no reason to use USD, EUR, JPY anymore if you are paying more than 0.5%. This is basically the whole of the financial sector, which gets demolished potentially in a short period of time. This is really the radical part, but it is I believe unclear how much the network can handle. Marketcap is 2B$ but actual transactions are a small fraction of that (but this is changing day to day).

Thanks.

1) Could somebody elaborate on transaction fees? Does this change with the reach of the total supply?

2) Yes, I know, the total supply won't change. But the fact that the supply is fixed is not the interesting feature. What I'm saying is: citing the 21m as total supply is arbitrary. 21m sounds better then 21m * 10^8. I see that this doesn't matter, it's almost a question of marketing.

In general a change in money supply is irrelevant. What matters is what those changes effect. If the amount of USD would increase by the factor of 10 tomorrow that makes no difference. What makes all the difference is where the money goes to (subsidies of financial institutions and the government). Becoming more clear on these factors is I think quite important.