Handing out currency to miners is no more and no less ethical than handing them out to the founders of a new currency. Use a currency if it serves your purposes and don't if it doesn't. Stop whining, Bitcoin doesn't exist to give you mining income or to let you get rich from any stash of bitcoins you might have amassed when they were still cheap. If Ripple takes off, it will be great for both BTC and XRP. If XRP ends up out-competing BTC, fine. It that means your bitcoins will become worthless, then boo-hoo-hoo.

The OP should stop bad-mouthing Ripple. He either doesn't understand it, or he is simply scare-mongering, perhaps falsely worried that his stash of BTC will become worthless. Ripple will be great for Bitcoin, but XRP will also be a competitor. Great, because competition is good. And the IOU system is actually what allows a liquid market for exchanging between crypto and real currencies to exist even in the face of government repression. If everyone is paid in fiat and needs to make payments in fiat but wants to store value in crypto, then their social network will provide a mechanism for turning wages into crypto and crypto into fiat when needed.

To the OP and other posters critical of Ripple: please do you homework first before you start throwing around insults and accusations.

Ripple has the same level of anonymity as Bitcoin.

If you want to trade between BTC and fiat currencies, then Ripple will likely be the best place to do it.

Investing in a business is not a get rick quick scheme. Venture capitalists don't just pour money into crazy schemes.

Ripple is its own exchange. Once you are in, you can use it to buy more XRP.

 So what? Many people here hold some BTC in the hope it will be very valuable one day. And the stash of XRP allows them to run a business and to stabilise the exchange rate, both of which are great for adoption. And adoption is the number one problem.

You can already encode messages into the blockchain if you want, though the qt client doesn't offer any GUI functionality for this and miners may reject nonstandard transactions.

It should make it easier for them to get funding, which should help with development, publicity and ecosystem building. It would also allow them to stabilise the exchange rate to a degree, which could help enormously. I've heard that's what they're doing, but I don't know if they've made any official statements about it.

You don't need to run your own DNS server if you're willing to rely on existing DNS servers that already work with .bit domains. You'd probably want to use something like FoxyProxy to make sure not every DNS request goes through such a server.

How To Browse Bit Domains

Even without gateways the trust network between individuals could provide a black market between fiat currencies and XRP / BTC even if merchants were forbidden to use XRP / BTC. This would be a very desirable development in say Zimbabwe. It could overthrow the government.

No more than is the case with Bitcoin. A large enough consensus can always change the rules, possibly leading to a fork.

Not the only difference. Crucially, it also supports BTC and offers a distributed exchange. This will make it much easier for merchants to support BTC and for consumers to get their hands on BTC. Even in countries where the government makes BTC illegal.

I wasn't talking about scrypt, but as an aside: do those 10 supercomputers have more hashing power than all PCs owned by individuals combined?

I'm not sure that's true if mining is based on an algorithm that cannot be done spectacularly faster or with spectacularly less energy consumption on ASICs than on CPUs.

But ASICs for mining could be outlawed and successfully suppressed by governments because there are only relatively small numbers of suitable production facilities. This could not be done for FPGAs as they have many legitimate other uses as well and can be programmed in the field. In addition governments could deploy large ASIC farms themselves thus potentially achieving >51% of hashing power.

I see Ripple as a great way to help the transition from fiat to crypto. Even if it succumbs to the threats you mention, it may still have helped Bitcoin or some other cryptocurrency gain acceptance.

Once the source code is released and new servers start popping up all over the place Ripple will be as distributed as Bitcoin. And since it is quicker and can be used to make convenient fiat payments it could see much faster adoption. If it is true that OpenCoin intends to stabilise the value of the XRP, this too will help its adoption.

As far the number of coins, XRP too has a fixed, finite supply, just like BTC. And, again as with BTC, not all of them are in circulation. BTC issues them as a reward for mining, XRP is premined and given away to new users.

OpenCoin temporarily acting as a central bank could be advantageous for adoption. They could prevent the exchange rate from rising too fast by selling from their hoard of XRPs. In doing so they could build up a stash of real world currency which they could use to buy up XRP if the exchange rate drops too quickly. They could also destroy some of their hoard. If XRP appreciates slowly but steadily, then it would be attractive both as a payment mechanism and as a store of value.

Keeping the exchange rate from going through the roof could be another reason. A virtual currency is useless as a payment mechanism if it is very volatile.