P2P crypto currency exchange vs Ripple

[greBit]

Ive been hanging out a fair bit on the `P2P exchanges` and `colored coin` nether regions of the bitcointalk forums. What I often notice are the one line replies along the lines of "what about ripple", "ripple already does this", and so on.

So I would like to ask my fellow Ripple skeptics to temporarily put aside their well-founded grievances at the closed nature of the OPENcoin Ripple project, and restrict themselves to mere technical details.

SO...as a technical solution, is Ripple all that we can ever dream of for peer to peer exchanging of crypto currencies?

What is it lacking?

For me it seems that the biggest downside is that it require the trusting of IOU issuers in order to exchange 1 crypto coin for another. Whereas in a true P2P system the exchanging parties actually hold the coins themselves, can prove their ownership of the coin and can make use of escrow to perform the exchange. There is little counterparty risk.


Secondly, is it feasible for Ripple to be used as a platform for real-time trading? Could it replace MtGox? or is its use to be limited to payment services?


Anyway im still struggling to play with Ripple since I apparently need 300 XRP to actually do anything But im starting to think that if it were open source I would probably really like it.

[Sukrim]

300 XRP are about the price of a Big Mac menu depending on the current rate on Bitstamp... or you can just offer some BTC here to get a few (for example an offer of 0.1 BTC for ~1000 XRP might be ok for both parties - it's above market but not too expensive).

IOU issuers won't exchange anything - that's the point in Ripple. IOU issuers only would focus on enabling people to deposit e.g. 1 LTC and receiving 1 LTC IOU in return that can later be redeemed for this 1 LTC. If this LTC gets exchanged or whatnot is of no concern to the gateway.

What's lacking might be an (OpenSource?) implementation of a client that can automatically issue/redeem IOUs on Ripple + has a connection to a bitcoin style RPC interface.

Real time trading might not really be possible (in the sense of <1ms latency), fast trades (in the range of few or less than 1 second for a trade) might work however.