Ripple: A Distributed Exchange for Bitcoin

[Sukrim]

Also, you never explained why 'it's not true' that XRPs cannot be issued at will. Explain me how I can be sure of that. We all know and can verify the proof of work of every last bitcoin. What about XRPs, how can I be sure opencoin doesn't start issuing them at will?

You can only verify the past, in both Ripple and Bitcoin. In Bitcoin you can also run a node yourself that will enforce rules for the future for you - it is however not possible to say if the coins guarded by this client will even be accepted anywhere in the future, as there is potential for hard forks. Ripple intentionally did not let many people run nodes yet, to do more events that would be equivalent to a hard fork in Bitocoin while developing.

I don't want to go on speculating what happens if the 4 biggest pools decide to mine different coins instead of the current BTC, but I can assure you that they DO have a lot of decision power and other pools are just not even fit to handle the amount of miners.

The "it's not true" part is as true for XRP as for BTC - in both cases new rules COULD be entered in the system in theory. In practice it is as unlikely (actually even more unlikely, XRP have a higher market cap than BTC currently for example) as for BTC core rules to change to issue more XRP. If you wish to bet money (BTC) on that, I'm more than willing to participate. So far noone has yet offered any bet statement + bet amount that XRP will actually be issued before Ripple becomes Open Source.

[nameface]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

So far noone has yet offered any bet statement + bet amount that XRP will actually be issued before Ripple becomes Open Source.

Are you trying to bet that OpenCoin will release all of the XRP intended for distribution (55B) prior to the server code ever being released?

[bluemeanie1]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

Why?

[nameface]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

Why?

A forking of the network could happen, but it would have to represent real progress, MeanieCoin > Ripple? I can only offer my guess that a system so complex, with so many developers and business people working hard in support of it, will be nearly impossible to usurp.

[bluemeanie1]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

Why?

A forking of the network could happen, but it would have to represent real progress, MeanieCoin > Ripple? I can only offer my guess that a system so complex, with so many developers and business people working hard in support of it, will be nearly impossible to usurp.

well if the XRPs are in the hands of specific people, and the community favors an alternative distribution of wealth- then a such a 'fork' would be well received.

if ALL the functionality is available to the public, why WOULDN'T they do this?

[mmeijeri]

I think this is one important reason OpenCoin isn't releasing the source code yet. They may want to create an installed base with a financial interest not to jump to a different fork. And before you start complaining about this, it is exactly what we are seeing right now with Bitcoin miners bitching about XRP.

[bluemeanie1]

I think this is one important reason OpenCoin isn't releasing the source code yet. They may want to create an installed base with a financial interest not to jump to a different fork. And before you start complaining about this, it is exactly what we are seeing right now with Bitcoin miners bitching about XRP.

well yes they want to create conditions where this SPECIFIC currency remains in demand- which naturally they retain most of the ownership of.

[nameface]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

Why?

A forking of the network could happen, but it would have to represent real progress, MeanieCoin > Ripple? I can only offer my guess that a system so complex, with so many developers and business people working hard in support of it, will be nearly impossible to usurp.

well if the XRPs are in the hands of specific people, and the community favors an alternative distribution of wealth- then a such a 'fork' would be well received.

if ALL the functionality is available to the public, why WOULDN'T they do this?

This is one eventuality where they WOULD do this. However, while XRP has value, nobody is pushing people to "buy in". Users and merchants can benefit from Ripple while holding very little XRP, and the value of XRP only necessarily needs to be enough to assure the integrity of the network by reducing spam transactions.

IOW a new network would have to create a new XRP-style currency out of thin air, and adopt a very similar scheme. They would have to somehow get everybody on board despite the fact that in Ripple, we already have a great functioning iteration of the technology, is how I'm reading it.

[Sukrim]

Are you trying to bet that OpenCoin will release all of the XRP intended for distribution (55B) prior to the server code ever being released?

No, that there won't be >= 100 Billion XRP in total before they go OpenSource/distributed.

See "What about XRPs, how can I be sure opencoin doesn't start issuing them at will?" - I'd offer 1:1 betting, so there is a chance to win the same amount back if they really issue more XRP than they promised to!

[zemario]

Also, you never explained why 'it's not true' that XRPs cannot be issued at will. Explain me how I can be sure of that. We all know and can verify the proof of work of every last bitcoin. What about XRPs, how can I be sure opencoin doesn't start issuing them at will?

You can only verify the past, in both Ripple and Bitcoin. In Bitcoin you can also run a node yourself that will enforce rules for the future for you - it is however not possible to say if the coins guarded by this client will even be accepted anywhere in the future, as there is potential for hard forks. Ripple intentionally did not let many people run nodes yet, to do more events that would be equivalent to a hard fork in Bitocoin while developing.

I don't want to go on speculating what happens if the 4 biggest pools decide to mine different coins instead of the current BTC, but I can assure you that they DO have a lot of decision power and other pools are just not even fit to handle the amount of miners.

The "it's not true" part is as true for XRP as for BTC - in both cases new rules COULD be entered in the system in theory. In practice it is as unlikely (actually even more unlikely, XRP have a higher market cap than BTC currently for example) as for BTC core rules to change to issue more XRP. If you wish to bet money (BTC) on that, I'm more than willing to participate. So far noone has yet offered any bet statement + bet amount that XRP will actually be issued before Ripple becomes Open Source.

Nice slalom around my questions. I specifically asked you not to make comparisons with bitcoin. Yet I only read three paragraphs of "just like bitcoin" baloney.

Cut to the chase. What do I verify when verify a XRP?

[Sukrim]

XRP work just like BTC, you can trace them back to the genesis block. The block chain is called "Ledger" in Ripple, the client + API to access it is Open Source.

[zemario]

XRP work just like BTC

No. BTCs are mined. A BTC is a proof of work.
XRPs are issued by opencoin. Opencoin can issue as many XRP as they want.

you can trace them back to the genesis block. The block chain is called "Ledger" in Ripple, the client + API to access it is Open Source.

I didn't ask how you verify them, I asked what do you verify. And the answer is: you verify that it is a legitimate XRP, and that is all. There is no proof of work as XRPs can be created at will by opencoin.

This discussion is getting absurd. You do not answer any of my questions. I've already made my point for whomever reads this thread.

[JoelKatz]

XRP work just like BTC, you can trace them back to the genesis block. The block chain is called "Ledger" in Ripple, the client + API to access it is Open Source.

Unfortunately, due to a server bug, some history was lost. You can't trace all the way back to the genesis ledger. You can trace back to ledger 32,570. All history after the beta was opened is available. All that was lost was the ledger headers -- all the transactions are still available, so there's some hope that the history may still be recovered.

In each ledger, there is a header field that tracks the total amount of XRP in existence. It is easy to check that the total XRP in the ledger equals the amount in the header and that the header field equals the previous ledger's total less the total of all transaction fees. There are no mechanisms to create or destroy XRP and any change that did so would be immediately detectable.

All ledgers (after 32,570) are publicly available. Each ledger contains the hash of the previous ledger and all the transactions that were applied to turn the previous ledger into this ledger. Each transaction is signed by the account that issued it and is bundled in the ledger along with metadata explaining precisely what ledger entries it affected.

If, for example, XRP were to somehow appear, there would have to be an accepted ledger before the XRP appeared and an accepted ledger after the XRP appeared. All these ledgers would be signed by the majority of validators or they wouldn't have been accepted. In the first ledger after the XRP appeared, there would either have to be a transaction whose metadata included the increase in XRP or not. If not, then there is 100% conclusive evidence that a stated invariant was broken -- an account's balance may not be changed without a transaction whose metadata shows that change. If so, then there is still 100% conclusive evidence that a stated invariant was broken -- an account's metadata may only change the total XRP in the ledger by destroying its transaction fee.

This would all be conclusively provable by anyone who cared to look.

[bluemeanie1]

In an open source scenario, I can create another set of XRPs, let's call them MeanieDollars, that do the exact same thing as XRPs.  That is, if Ripple will indeed go open source.

GLWT. Ripple is not your average open source project. 30+ "MeanieCoins" have been created, and only Litecoin ever did anything (as bitcoiners seem to love it for some reason). It will probably be even harder to fork Ripple than it currently is to fork Bitcoin.

Why?

A forking of the network could happen, but it would have to represent real progress, MeanieCoin > Ripple? I can only offer my guess that a system so complex, with so many developers and business people working hard in support of it, will be nearly impossible to usurp.

well if the XRPs are in the hands of specific people, and the community favors an alternative distribution of wealth- then a such a 'fork' would be well received.

if ALL the functionality is available to the public, why WOULDN'T they do this?

This is one eventuality where they WOULD do this. However, while XRP has value, nobody is pushing people to "buy in". Users and merchants can benefit from Ripple while holding very little XRP, and the value of XRP only necessarily needs to be enough to assure the integrity of the network by reducing spam transactions.

IOW a new network would have to create a new XRP-style currency out of thin air, and adopt a very similar scheme. They would have to somehow get everybody on board despite the fact that in Ripple, we already have a great functioning iteration of the technology, is how I'm reading it.

how can XRP have any value if it's possible for anyone to run their own Ripple network ie. the software is open source?

[cryptoanarchist]

Ripple is crap

[Sukrim]

XRP work just like BTC

No. BTCs are mined. A BTC is a proof of work.
XRPs are issued by opencoin. Opencoin can issue as many XRP as they want.

A BTC is not a proof of work, you can obtain them without having done any mining.
Also they are fungible, meaning that you can spend a BTC that was created when difficulty was still 1 the same as a recent one with difficulty far OVER 9000.

As I already said: I don't believe Opencoin (with whom I'm not affiliated in any way) will issue any more XRP, you're free to suggest a formal bet (in BTC with escrow and whatnot) on that to me.

Your client most likely also doesn't trace back to the coinbase transaction (except if you are using colored coins).
Anyways, as I "don't answer your questions" let me have a last try:

uuuh.. what?
Are you serious or just trolling? honest question.

I'm serious.

Also, you never explained why 'it's not true' that XRPs cannot be issued at will. Explain me how I can be sure of that. We all know and can verify the proof of work of every last bitcoin. What about XRPs, how can I be sure opencoin doesn't start issuing them at will?

You cannot be sure, jsut as you cannot be sure that there will be 21 million Bitcoins ever. There is no inherent limit in the underlying mathematics, so any limit (100 billion XRP, 21 million BTC) is an arbitrary choice that is done by a community in the case of Bitcoin and a company in the case of XRP. In both cases it is against their expressed intent to issue more currency than initially planned. Both currencies are not backed by anything really but their utility as money and the trust of their respective community. Just as the Bitcoin community would probably react negatively or even hostile towards anyone changing the maximum amount of Bitcoins, a similar loss in trust would be the case with Opencoin + XRP inflation.

As I said, you cannot be sure with any cryptocurrency that rules won't change BUT it is in the best interest of the ones running that currency to make sure to deliver on their promises as they are mainly backed by trust and utility, not gold or a country.

Proof of Work is not magically limiting your Bitcoins to 21 millions, there are PoW coins out there with different/no limits and some with all/lots of coins mined in the genesis block.

Cut to the chase. What do I verify when verify a XRP?

I'm not 100% sure what you mean by "verifying", I assumed that you mean "check, if that transaction I received actually is valid, has been finalized in the global ledger and I can spend the money I received". My answer has been "it works just like BTC" which was not enough for you.

You verify the transactions in the blocks aka. ledger since genesis, just like in Bitcoin.
After your transaction is in there, you can spend the money with your private key. It does not matter when it has been created, just like in Bitcoin, as long as the transaction used to send it to you was valid, the XRP/BTC are valid too.

how can XRP have any value if it's possible for anyone to run their own Ripple network ie. the software is open source?

how can BTC have any value if it's possible for anyone to run their own Bitcoin network ie. the software is open source?

[zemario]

A BTC is not a proof of work, you can obtain them without having done any mining.

Hate this ping pong kind of discussion but, Yes it is a proof of work.
It is irrelevant if you get them from the person that mined it or not. It had to be mined, there is mathematically no other possible way to create it (unlike ripple)

Also they are fungible, meaning that you can spend a BTC that was created when difficulty was still 1 the same as a recent one with difficulty far OVER 9000.

Once again, that is irrelevant. When BTC was easy to mine it was naturally not as valuable as it is today. Your coins were either mined at a high dificulty, or during the early days, when investing in mining had much higher risk than now. I'm not sure what is that you're trying to prove with that observation.

As I already said: I don't believe Opencoin (with whom I'm not affiliated in any way) will issue any more XRP, you're free to suggest a formal bet (in BTC with escrow and whatnot) on that to me.

Yeah, I will put a bet on something which outcome will take years. Anyway, what are you trying to prove? At the most you prove that you like betting. Suggesting a bet doesn't put you on the right, quite the opposite.

You cannot be sure, jsut as you cannot be sure that there will be 21 million Bitcoins ever.

This is just plain false.
If you change the BTC protocol to mint more coins, you need to convince 50%+ to accept your blockchain fork and not some other.
You are basically saying that I cannot be sure that bitcoin network won't be disrupted. Sure, that's true. But to ripple all it takes is opencoin's CEO having a bad day. It's not 'just as'.

There is no inherent limit in the underlying mathematics, so any limit (100 billion XRP, 21 million BTC) is an arbitrary choice that is done by a community in the case of Bitcoin and a company in the case of XRP.

That is exactly my point.
Community consensus is much more secure than the mood of opencoins CEO.

I'm not 100% sure what you mean by "verifying", I assumed that you mean "check, if that transaction I received actually is valid, has been finalized in the global ledger and I can spend the money I received". My answer has been "it works just like BTC" which was not enough for you.

If I have a blockchain and a bitcoin implementation on my computer, I can instruct my computer to effectively verify that the coins I own were issued to somebody that has contributed to the network with an amount of work likely proportional to that amount of coins.
By using the ripple client I can only verify that the XRP was issued by opencoin. Considering they did it with nearly zero effort I am pretty much verifying that bananas.

[Sukrim]

I'm not aware of any kind of transaction in Ripple (probably JoelKatz can shed more light on this) that would even allow issuing more XRP out of the blue.
Anyways, we're quite a bit offtopic here, if you want to continue to argue that XRP are worthless (or worth less...), please open another thread for discussing this.

What I find interesting is that even though Opencoin just started their giveaway of 1000 XRP to their mailing list, the price compared to BTC actually rose, so more and more people are selling BTC for XRP, not the other way round! I would have suspected that lots of Bitcoiners/latecomers for the forum giveaway would just cash out their 1k XRP and be smug about the "free 10-15 Bitcents"...

Either they don't even want that free money (or it is "too much hassle"?) or TradeFortress and co should have better invested their ad money in a usable OpenTransaction client bounty.

[bluemeanie1]

I'm not aware of any kind of transaction in Ripple (probably JoelKatz can shed more light on this) that would even allow issuing more XRP out of the blue.
Anyways, we're quite a bit offtopic here, if you want to continue to argue that XRP are worthless (or worth less...), please open another thread for discussing this.

What I find interesting is that even though Opencoin just started their giveaway of 1000 XRP to their mailing list, the price compared to BTC actually rose,

on what exchange?

[Sukrim]

On Ripple itself, it is after all an IOU exchange/market place.