Hey. Had a quick question.
I have some Ripple, but I thought you could trade for BTC directly with Ripple. So that's not possible? Then what's the point of Ripple if someone still has to trade first? Ripple is so confusing.
Inside Ripple, you can trade XRP only for IOUs issued by other participants. For example, you can sell your XRP for BTC IOUs of one of the gateways. You then need to open an account with this gateway and ask them to redeem BTC IOUs that you've got. Hopefully, you'll get BTC on your gateway account as a result. After that, you can withdraw these BTC to your Bitcoin address, if the gateway allows this. If you're interested to learn in detail how various components of Ripple work, this is a worthwhile exercise.
Sounds complicated? Just send XRP to my address, pm me your Bitcoin address and get your payment in real BTC in no time.
I've read about it and still doesn't make sense. The gateway Bitstamp will get the BTC IOUs and won't honor the IOUs because there's no trust with the stranger doing business with them yet. In which case, the IOU will just sit there pending until the right amount of trust is worked out between all the members and the gateway allowing the IOU to be paid off. And then by doing this I lose XRPs? But if I send you XRPs directly then I won't be charged any XRP fees in the transaction?
