I liked it, so I reserved 16

I'm kinda curious what Ripple looks like without this feature. For two reasons. First, the OpenCoin guys don't seem like they get the fact that it's broken.. are they forced to defend it because Ripple is useless without this feature? Second, as a trader I obviously think it would be useful to trade Mtgox USDs for Bitstamp USDs, which doesn't rely on the broken feature. Can I just have that part?

Y'all are arguing semantics. The key point here is that, by default (and it's not adjustable in the UI), when you trust two gateways for the same currency, Ripple assumes that means you are willing to trade one for the other. This is broken. If I trust mtgox for 1000 USD and bitstamp for 1000 USD, it doesn't mean I'm willing to trade mtgox USDs for bitstamp USDs at a 1:1 ratio.

The fact that the OpenCoin guys continue to claim this is a good idea demonstrates that they have no idea how risk works.

Why do you think the price of bitcoin over the last couple of weeks between Bitstamp and Mtgox had a multiple-percentage spread? Understand this, and you'll understand why present-day Ripple is broken.

Ripple might still survive and be useful one day, but not until this is fixed.

Rock on TradeFortress. The "automatic liquidity providing" feature is broken and I expect they'll eventually figure it out and turn it off.

The question I have yet to get a straight answer from anyone is, what happens to Ripple when everyone turns off automatic liquidity providing? does it still 'work'?

sounds a bit like satoshi square

version 22:
 - fix bug which caused widget not to work when default coin was accepted
 - add support for coinbase BTC

what kind of hash rates do you get for scrypt mining under linux with these?

+1 (except the part about all of us perishing; this claim is also unverifiable)

First of all, retirement is a myth. I know, because I've been there. You'll get bored. You still have to work; on relationships, your passions. Stuff doesn't just magically happen in your life because you have money.

Of course, you can sit there and do nothing (like the zen guys), or watch TV (much more likely). But if this is what you want to do, you're killing yourself by waiting. If you're sick of work, my advice would be to stop working *now*, not wait decades. Because if you wait, you'll be very sad when you discover that your whole life has wandered by while you were holding out for a bunch of money. If you take time off, you might discover that you actually want to "work", and then it's not work anymore.

So it's irrelevant how much BTC you have. "Retirement" (aka "freedom") depends more on mental outlook than funds in the bank. Maybe there's a limit to this, but it's quite low. Read Thoreau's Walden, he retired with almost no money.

Second of all, retirement is a myth because of what 1bettor says. The guys at Vanguard or Fidelity or your 401k who peddle "retirement" don't know what's going to happen to money, stocks, etc. Most of them are clueless about the risks from government money printing that could collapse the whole system and destroy everyone's "retirement". I guess all I'm saying is.. I wouldn't bank on it!

Finally, bitcoin is risky. Every day there is a nonzero chance of 51% attack or nation-state difficulty attack. If you dream otherwise, you are sticking your head in the sand.

I'm looking to acquire a GPU mining rig or rigs, perhaps from somebody who is moving up to ASICs. I want it for scrypt/LTC mining and perhaps other alt chains. I would be curious what I can get for around $10k USD, possibly a little more. Strongly prefer a linux setup. Shipping to the US. Will require escrow if you want payment in BTC. Please PM me if you have an offer. Thanks.

I guess, but with the default set to 100% quality, probably everyone would route around me and it's not worth the risk.


This misstep gives me some concern about OpenCoin's understanding of markets. Did they seriously not realize that liquidity providing is a risky business that demands payment to the liquidity provider?

Interestingly, this does not seem to be true. It's only the UI that has this behavior. Power users can turn it off.


I don't know enough to comment about this specific situation. I do know that Ripple is very hard to understand and a lot of people are putting a lot of money into it. Therefore, I support TradeFortress's efforts towards promoting a skeptical attitude about it. Remember Pirateat40?

I think this is right. It sounds a lot like what the OpenCoin guy in the booth told me. He said you can even move it all the way to zero (in both directions), effectively disabling all rippling through you.

Since there are risks involved with being a free liquidity provider, and no benefits (as far as I can see), I'm trying to understand what incentive I have to do anything other than dial this knob all the way down?


Interesting. Thanks for your insight.

I was able to get access to the source by asking in person. Perhaps a phone call or very courteous email is all it would take.

Huh? But what if I want to hold more than one type of USD IOU? Are you saying everyone should just use a single gateway? Surely there are valid reasons to trust more than one. For example, it becomes more convenient to deposit with a new bank, though you still hold an account at your previous bank.

And I'm still searching for an answer to my question:


Misterbigg, do you know the answer?

I posed this question to a Ripple employee at the Bitcoin Conference this weekend. He told me that you can indeed prevent the system from "ripple"ing, but the option is not in the current client (and it's on by default). So my followup question is, does ripple still work in practice if this default is switched to "off"?

I am more concerned about a nation-state performing a difficulty attack than I am a 51% attack, though I hear with a mere 51% there may be a shortcut.

I was the one who asked the question about the difficulty attack. I'll recap what it looks like here:

A nation state "wakes up" to bitcoin one day, and decides they don't like it. Let's use China as the example, because they have capital controls thus there's a reasonable argument for why they might want bitcoin to go away, and they the resources to perform this kind of attack.

First the attackers try firewalling bitcoin, only to discover that it keeps popping back up as users figure out how to circumvent their censors digitally through technologies like tor, or even physically by trading physical bitcoins.

So then they ask their scientists if there's another way to destroy it, and the scientists do their homework and devise the following plan:

1. Print a massive quantity of asic chips. They're probably mostly going to be manufactured there anyway.
2. Start hashing, driving the difficulty up, say, by a factor of 10000
3. Wait until just after a difficulty adjustment, then
4. Stop hashing all at once

At this point, the bitcoin network fails. It can no longer process transactions because none of the miners can find a single block, therefore no transactions are verified. Furthermore, the downward difficulty adjustment which usually takes about 2 weeks now takes about 20000 weeks, or some 370 years.

Confidence in bitcoin is shaken.

So now what? Undoubtedly the community comes together to try and fix this. (In the case of Terracoin, perhaps this didn't happen simply because there wasn't enough at stake.) The miners, developers, and merchants get together and hard fork the chain in order to manually reset the difficulty. Bitcoin is revived! Briefly.

A few days later, China performs the same attack again, forcing another hard fork. The cat-and-mouse continues. Mainstream users begin walking away from the currency in droves. Price plummets. Eventually, though, Bitcoin's hashing algorithm is changed, rendering the Chinese hardware useless.

The next attack comes weeks or months later, after the Chinese have had time to build the new ASIC (or GPUs for scrypt mining, whatever).

In the meantime, every time the attack happens, transactions are reversed (for those that are unlucky enough to have been relying on the wrong chain), merchants are unable to use bitcoin for periods lasting hours and possibly days after each attack. The devs start seriously considering a whitelist for miners so only known "nice guys" can play, and the days of a truly decentralized currency are numbered. By this time, bitcoins are trading for 10 cents a piece, and even the true believer types have mostly switched to an alt coin, which can survive only by virtue of being too small for China to care..

There, that grim enough for ya? :-D

Thanks TradeFortress, I think you're doing everyone a service by getting them to take a hard look at how ripple works.

I was just at the bitcoin conference, and I had at least a dozen conversations about ripple. Pretty much none of the people I spoke with understand it. Even some of the guys in the ripple booth (though they were courteous and eager to help), got stumped on some issues.

My primary concern with ripple is exactly what TradeFortress has just demonstrated. Ripple IOUs have different values based on the issuer. If they traded on an open market, you would see this. IOUs for a trusted institution are worth more than IOUs for a less trusted one. E.g. you might see Bitstamp USD IOUs trading against Weexchange IOUs at a non-1 rate, such as 1.1.

But we don't see that in ripple (as far as I can tell). Instead, we see a markets labelled by the currencies only, such as USD/XRP. But whose USD? Where's the Bitstamp USD / Weexchange USD market?

The fact that default risk fluctuates is acknowledged by participants in the real financial markets. We have credit markets. The values of various entities' credit float against one another. They are not all the same.

When I posed this question in the ripple booth yesterday, here is the (paraphrased) answer I got:
me: "So what's up with this automatic liquidity providing, given that some IOUs are more valuable than others? Couldn't we have a 'bank run' type situation when a gateway starts to look like they're in financial trouble, and innocent ripple users who happened to be 'asleep at the wheel' at the time wind up holding all the bad debt?"

ripple employee: "Good point. I think that the protocol supports setting a price at which you are willing to exchange a certain issuer's IOUs for another issuer's. It doesn't have to be 1:1. I think the client just doesn't support this yet."

me: "Okay, cool. But does it have to be a fixed amount or is there some kind of floating rate?"

ripple employee: "I think it's just a fixed amount."

Needless to say, I was not particularly impressed by this answer.

Honestly, I expect to be wrong about this, because there are seemingly a lot of smart guys involved and they really seem to have strong technology. Can they really have missed some basic facts about how markets work? Na, probably I missed something. But I'm definitely not betting on it until I hear a satisfactory answer.

Yep, I saw it too. Switched to api version 1.

Another challenge is finding BTC sellers on your Cuban exchange. Assuming you receive local Cuban currency in exchange for your bitcoins, someone is going to have to figure out how to convert local Cuban currency into something they want. Aren't there capital controls making this difficult?