Say, hypothetically, you were the president of a publicly-traded company and you were about to announce a major new product that would likely result in an increase in your company's stock price. Or maybe you're not about to introduce a major new product but people are expecting you to. Or may you know your company is being investigated by the FBI for importing lobsters illegally (50 CFR 640.27). And say someone on a forum asks you, "So, what up with your company?" What do you do?

Placing an offer to buy an IOU implicitly extends trust to hold the IOUs that result from people taking the offer. We had to do it one way or the other and neither is exactly what you want in all cases, but this is probably what you are more likely to want most of the time.

Some people want to sell Bitcoins for dollars or other fiat currencies. Some people want to buy Bitcoins for dollars or other fiat currencies. Exchanges bring buyers and sellers together.

And now you've switched from "pure logic" to your opinion. My opinion is that no living thing has the right to live at the expense of the bodily integrity of a conscious being.

Say a stranger needs your kidney and your house (to sell to pay for the kidney transplant) to live. They will die without them, and you can live with one kidney and no house. If you don't give them your kidney and your house, have you wrongfully killed them?

Miners get the transaction fees for transactions they include in the block they mined.

This is definitely one of the ways we are considering. One of the advantages of this scheme is that it can be highly automated. It is difficult to game if the PoW algorithm is carefully chosen. The downside is that it's not particularly fair, except for an unusual sense of fair.

Unfortunately, no. I am prohibited from discussing that. Those things that I cannot comment honestly on for any reason, I simply do not discuss. There's nothing I enjoy more than sharing my honest opinions with others, but in this area, I cannot do so.

You don't literally have to. But you would have a hard time processing withdrawals without running your own server. Theoretically, you could do it if you layered your own software on top of the parts of the client that communicate with the server, but I don't think anyone's done that yet.

You could do it by processing all transactions manually in the regular client, but you couldn't use destination tags, so you'd have a somewhat roundabout process for withdrawals. Someone would have to say "Hey, my Ripple account is X and I want to withdraw Y". You say, "Okay, send me the funds you want to withdraw". Then you match them based on the Ripple account they were sent from.

The display you see is rounded. Mouseover the balance to see it with full details. It's probably got a .9999x ending on it.

It is definitely complicated "under the hood". The trick for us is going to be hiding the complications from users. That is a significant challenge.

We call an entity a "gateway" if it has certain characteristics. If you have these characteristics, we'll call you a gateway. If you have some of them but not all of them, some people may call you a "gateway" and some may not. You can do whatever you want.

Generally, we call a company a "gateway" if:

1) They offer a reasonable "redeem on demand" agreement to a large group of people.

2) People have good reason to value their IOUs at close to face value.

3) They make it their business to issue IOUs.

But you can do most of what a gateway does without being a gateway. For example, you can sell Bitstamp IOUs to people face to face. You can buy Bitstamp IOUs from people face to face for cash.

In some cases they are treated as the same currency, in some cases they are treated differently. The system does allow you to value IOUs in the same currency but different issuers differently, but this is a very tricky feature to use correctly. The main difference is this: To change the issuer of an IOU but not the currency, you can ripple through someone. To change the currency, whether or not you change the issuer, you must take one or more offers.

I think the scenario you're envisioning is this:

1) I deposit 10 BTC at a gateway using a Bitcoin transaction.

2) I don't extend trust to that gateway.

3) I try to withdraw the 10 BTC to my ripple account.

What happens depends on the gateway's policy. First, they can't give you their own IOUs since you don't accept them. And if you don't accept any BTC IOUs, the operation is impossible and will fail. But say you accept BTC IOUs from some other gateway. They could make the withdrawal work. There it's up to their policy. Possible policies are:

1) They just don't allow it. You must extend them credit to withdraw, period.

2) They allow it so long as it won't cost you more than 1%. So you may wind up with 9.9 BTC in your account.

3) They allow it at any loss level, provided you agree to accept the loss.

You can drop a credit limit below the level of IOUs you hold. This indicates you don't want to hold those IOUs any more. People can now take them from you but not give them to you. If you're an attractive path for them, they should fix it for you over time.

If you extend them trust, you're allowing them to take IOUs you hold and to give others your IOUs! Unless you don't hold any valuable IOUs in that currency and don't care if other people hold your IOUs in that currency, this is *not* a good idea.

There is an important difference between IOUs denominated in the same currency and IOUs denominated in different currencies. Changing currencies always requires going through an order book and taking from one or more offers. Changing the issuer of an IOU without changing the currency doesn't require an offer and can instead just ripple through someone who holds the IOU you want and wants the IOU you hold.

Say you have WeExchange/BTC and need to pay someone Bitstamp/BTC. You can ripple through anyone who holds Bitstamp/BTC, has extended credit to WeExchange/BTC, and does not hold WeExchange/BTC that equals or exceeds their credit. You would have to pay two transfer fees, which right now is something like .7% in total. (I hope competition will eventually bring this down.)

If you weren't in a hurry though, you could just drop your credit limit to the exchange whose IOUs you don't want to hold and raise the limit to the exchange whose IOUs you do want to hold. Once the next upgrade to Ripple pathfinding gets pushed out, people who need to go the other direction will prefer you to ripple through, and so (hopefully) the exchange will happen gradually for you (thanks to people who need to go the other way) at no cost to you because they pay the fees.

I fully understand that this kind of reasoning has a kind of attractive logic to it, but I think that's an extremely unlikely scenario. I could have made a similar argument in 1950 that people would soon abandon fiat currencies and switch to gold certificates. I can make a similar argument that Bitcoin will make fiat currencies obsolete. Sure, that might be the endgame in the far future, but to focus on that endgame *now*, rather than the many decades of work we have to get there, is navel contemplation.

The sperm and egg cells are alive and will die if fertilization is not accomplished. So is a woman who refuses to have sex with me a murderer?

I chose not to be a doctor. Maybe if I had been a doctor I would have saved hundreds of lives. Does that make me a murderer?

What you're missing is that the term "murder" doesn't mean someone who took any action that results in someone's death. It means *wrongful* killing -- it doesn't include decisions within a person's legitimate scope of moral authority, such as my choice to be a doctor, because they are not wrongful.

It's possible, but it requires a lot of people to do a lot of things very wrong.

Gateways hold fiat, not XRP. There is no reason to deposit XRP with a gateway. We're working with Bitstamp to make sure XRP sent to them by mistake are returned.

This is the problem we are trying to solve. We're trying to make them different ... better. Bitcoins have different properties from USD -- they can be electronically transferred on the Bitcoin blockchain without anyone having to hold them. The idea is to take advantage of that ... somehow.

For example, say we want Bitcoin to better support nanotransactions. We could withdraw bitcoins from the block chain into a system optimized for microtransactions. Then, when we had a balance we wanted to cash out, we could withdraw back to the bitcoin block chain. The same thing could be done for faster confirmations. However, for this to work, we either have to have a central authority who holds the keys or we have to each pick our own issuer as Ripple does. The question is ... is there a better way?

I can prove it can be done, so it's not impossible. But my proof is a scheme that's not practical.

This doesn't solve the problem either. It still makes it so that one and only one entity can transfer any particular asset. This means that either that entity has to be a central authority everyone trusts or different people pick their own and the assets aren't fungible.

Each transaction costs a very tiny fraction of one XRP. The XRP used to open accounts and held for reserve against offers and credit lines are not consumed and can still be used to pay transaction fees. For offers and credit lines, the reserve XRP are released when the object is destroyed.

The thinking is that XRPs will never get used up under any imaginable realistic scenario. The transaction fees and reserve levels can be adjusted by consensus and XRPs are divisible into millionths. If it were ever needed in some far distant future, the protocol could be changed by consensus to make XRP more divisible or to multiply everyone's XRP holdings by a million. But it's hard to imagine any such thing would ever be needed. If we're wildly successful, our great, great grandchildren will be smart enough to figure it out.

They won't always be on par, but if the gateways are doing their jobs, it should almost always be very close. Every failure is a profit opportunity.

Yes but no. A payment will take from offers if that's the best payment path. When making a Ripple payment, this is the typical payment mechanism:

1) The client gets the destination account and destination currency from some source. ("Pay Jeff 50 Bitcoins.")

2) The client looks at what the user holds and picks one or more source currencies to use.

3) The client asks the server what its options are. The server forms payment paths using the various possible source currencies taking into account what the destination will accept. These payment paths can ripple through accounts that hold and accept multiple IOUs but also offers. No transactions have been performed yet, so this is all free.

4) The client tells the user something like "You can make this payment for 50.03 bitcoins or 125 USD."

5) The user picks a source currency.

6) The client assembles one final transaction, incurring one fee. The transaction can include multiple paths (so long as they use the same source currency). The transaction can include a "maximum to spend" and the transaction will fail if it would cost more than that.

7) The client submits the transaction. The servers process it. The transaction is accepted. (The servers will take incrementally from more than one path of the paths explicitly specified in the transaction to get the best result.)

Notice that only one transaction is needed, even if you ripple through multiple accounts, take from multiple offers, and so on. The one and only transaction is basically "get Jeff 50 bitcoins he'll accept and don't charge me more than 50.03 Bitcoins to do it."

Possibly. But I don't see why that will be bad. Since there will be many possible paths for the same transaction, costs should typically be low. We'll see.

Anyone can now scrape balances and account information from the ledger I posted here:
http://goo.gl/GfoZW