Is Ripple a scam?

[Galahad]

I've heard mainly bad things about Ripple so far.

One person told me it is the perfect compliment to Bitcoin as it allows us to exchange our cryptocurrencies in a similar P2P manner. But many things about it worry me including, the central control over XRP supply. As I understand it XRP are only there as transaction tokens so that people can see that money has been exchanged. The real cryptos exchanged must be stored by Ripple in some other way unless I have that wrong. They (Ripple | Open Coin) also have kept most of these coins and have abandoned mining (proof of work) without any similar alternative (proof of stake) in favor of central control. The absence of an alternative solution to this problem means for me is a red flag. It looks like a hierarchy of control due to the centralized aspect..

[QuantPlus]

It must be Feb 2013 where you are today.

How's the weather? What's on the news?

[Galahad]

It must be Feb 2013 where you are today.

How's the weather? What's on the news?

y?

[yvv]

They (Ripple | Open Coin) also have kept most of these coins and have abandoned mining (proof of work) without any similar alternative (proof of stake) in favor of central control. The absence of an alternative solution to this problem means for me is a red flag. It looks like a hierarchy of control due to the centralized aspect..

https://ripple.com/wiki/Consensus

[LiteCoinGuy]

I've heard mainly bad things about Ripple so far.

One person told me it is the perfect compliment to Bitcoin as it allows us to exchange our cryptocurrencies in a similar P2P manner. But many things about it worry me including, the central control over XRP supply. As I understand it XRP are only there as transaction tokens so that people can see that money has been exchanged. The real cryptos exchanged must be stored by Ripple in some other way unless I have that wrong. They (Ripple | Open Coin) also have kept most of these coins and have abandoned mining (proof of work) without any similar alternative (proof of stake) in favor of central control. The absence of an alternative solution to this problem means for me is a red flag. It looks like a hierarchy of control due to the centralized aspect..

simple answer: yes its a scam.

[nameface]

Galahad, I'm serious about Bitcoin and Ripple, and I work to dispel FUD in the name of progress.

One person told me it is the perfect compliment to Bitcoin as it allows us to exchange our cryptocurrencies in a similar P2P manner.

Ripple is a way to trade Bitcoin in a decentralized manner. You have to trust that your gateway/s will remit, but you don't have to rely on them to trade your Bitcoin balances in Ripple. It's different than using an exchange site in conjunction with a Bitcoin wallet. You can trivially plug into Ripple yourself and move around all kinds of balances in a variety of currencies.

But many things about it worry me including, the central control over XRP supply.

OpenCoin's system is to award themselves 100 billion XRP, and distribute and sell 80 billion of these over time. I personally do not understand why people would object to this. Ripple is a distributed payment processing system, not a way for random people to receive free money in the form of XRP. However, the scheme for the distribution of XRP makes it likely that large amounts of people will actually receive some free money (this has already started as the Bitcoin community is well aware), which is very cool in my opinion.

As I understand it XRP are only there as transaction tokens so that people can see that money has been exchanged. The real cryptos exchanged must be stored by Ripple in some other way unless I have that wrong.

I call XRP the world's newest commodity money. It is both a "real crypto" and a token for paying network fees. Lots of info here: https://ripple.com/wiki/.

They (Ripple | Open Coin) also have kept most of these coins and have abandoned mining (proof of work) without any similar alternative (proof of stake) in favor of central control. The absence of an alternative solution to this problem means for me is a red flag. It looks like a hierarchy of control due to the centralized aspect..

OpenCoin have pledged to GIVE AWAY 55 billion XRP, and they will be selling their own 25 billion XRP supply to fund their operations. So yes, they have "kept the XRP", and we must trust they will distribute it in a logical manner. But Ripple will be open sourced eventually, and if the community doesn't agree with OpenCoin's conduct, they can just start their own Ripple using the same technology. The time has certainly not come yet for criticizing OpenCoin over centralized control. When this time comes, my prediction is people will be saying: "Wow, OC did real good.".

With regard to PoW and PoS, Ripple uses an alternative solution called Consensus. Here's a video that explains it http://www.youtube.com/watch?v=pj1QVb1vlC0&feature=youtu.be

[Galahad]

Galahad, I'm serious about Bitcoin and Ripple, and I work to dispel FUD in the name of progress.
...

OK thanks for explaining that. Are you working on Ripple anyway or just interested like me?

[Pokerfan]

Ripple is a closed source centralized payment system.

It's not a scam, because they don't promise anything (other than lying about being open source and decentralized). I'd say it's a failed implementation of a decent original ripple idea.

[yvv]

other than lying about being open source and decentralized

Proof?

[AmazonStuff]

Ripple is not a scam, listen to this...

Number of XRP that can ever exist: 100 billion XRP
This total of 100 billion XRP are distributed in this fashion:
Number of XRP kept by founters: 20 billion XRP
Number of XRP kept by OpenCoin: 80 billion XRP

This 80 billion XRP OpenCoin will be distributed in this fashion:
Number of XRP that OpenCoin is going to sell to fund ongoing development beyond the initial angel investment: 30 billion XRP
Number of XRP  that OpenCoin  will give away to spur adoption: 50 billion XRP

Let me address your biggest fears... So, average Bitcoiner will say, OK this is the fraud, OpenCoin and founders have too many XRP, if they dump, we are going to lose our money... Am I right?

Well, it's a wrong logic.

This is why...
When you start with Ripple Network, you start with IOU, either BTC IOU or USD IOU in the case you are using Bitstamp, so you don't hold XRP.

So, let's suppose that OpenCoin is a fraudster company and that the dump actually is going to happen, what will happen to your BTC IOU or your USD IOU... Absolutely NOTHING! You will still have the same amount of BTC IOU or USD IOU as you had before the dump.

When you make exchange from BTC IOU to USD IOU, you are a holder of  XRP for the fraction of second, that could not influence your BTC IOU or USD IOU stash, you are completely safe.

Benefits that Ripple brings to Bitcoin is a P2P Currency Exchange, so it will make Bitcoin stronger, no government could shut it down. Currently, Bitcoin is vulnerable, because Bitcoin Exchanges are websites which could be shut down easily if Bitcoin is declared illegal by world goverments and believe me Bitcoin could not survive without exchanges, he will lose it's value very fast.

So that's it, holding XRP is a question of preference, you can be in the Ripple Network, do the trades and NEVER hold XRP if you don't like that.

I hope that I helped a bit.

Cheers

[yvv]

So that's it, holding XRP is a question of preference, you can be in the Ripple Network, do the trades and NEVER hold XRP if you don't like that.

You do need to keep small reserve per wallet actually. This is where XRP value comes from.

[Pokerfan]

other than lying about being open source and decentralized

Proof?

http://web.archive.org/web/20130408174039/https://ripple.com/

Ripple is Open

    Anyone can use it.
    No one owns it.
    The software is open source.

https://ripple.com/ -> download source code

Oh wait, there is no such link?!      

You can't have a decentralized system without the open source code.

It's not a scam, because they don't promise anything

I take my words back – Ripple is a scam.

All things you need to know about Ripple: http://ripplescam.org/

[markm]

You can trivially plug into Ripple yourself and move around all kinds of balances in a variety of currencies.

Actually no it is far from trivial to plug in to Ripple, because the source code for the plug-in, the daemon whereby you plug in ("rippled") is missing currently.

I wanted to plug in various currencies, or as it were permit various currencies to plug in by making gateways for various currencies, but so far that still is being put off seemingly indefinitely.

-MarkM-

[yvv]

http://web.archive.org/web/20130408174039/https://ripple.com/

Ripple is Open

    Anyone can use it.
    No one owns it.
    The software is open source.

https://ripple.com/ -> download source code

Oh wait, there is no such link?!      

Your link is out of dated. The "download source code" link is pointing to old location of ripple client on github. Currently it is in https://github.com/ripple/ripple-client

As for ripple server, it is clearly stated on official wiki page

Rippled is the server component of the Ripple network. The source code is not currently publicly available. Rippled will be open sourced soon.

Early access to the source code is available to select business partners. If you are planning a Ripple based business and are interested in early access, please contact partners@ripple.com

You can't have a decentralized system without the open source code.

Right now, as wiki states, sources are provided to "select business partners", so it is decentralized. Sources will be opened to general public when beta testing is done.

All things you need to know about Ripple: http://ripplescam.org/

ripplescam.org is a piece of stinky scam itself with a lot of misleading statements. It is very funny when scammers blame somebody in scamming.

[yvv]

I wanted to plug in various currencies, or as it were permit various currencies to plug in by making gateways for various currencies, but so far that still is being put off seemingly indefinitely.

-MarkM-

Did you contact OpenCoin on that matter? Providing assistance for new gateways is among their highest priority tasks.

[Come-from-Beyond]

https://ripple.com/wiki/Consensus

This consensus has too many assumptions and its description uses "unlikely" word too often. BS IMO.

[yvv]

https://ripple.com/wiki/Consensus

This consensus has too many assumptions and its description uses "unlikely" word too often. BS IMO.

"Too many" is the assumption that validators are unlikely to collude. Bitcoin mining is also based on the assumption that it is unlikely that somebody will have enough computing power to break the blockchain.

[Come-from-Beyond]

"Too many" is the assumption that validators are unlikely to collude. Bitcoin mining is also based on the assumption that it is unlikely that somebody will have enough computing power to break the blockchain.

RSA security based on assumption that it is unlikely that somebody can factorize a big number.
Bitcoin and RSA are protected by economical laws (resources are limited). See the difference?

[yvv]

"Too many" is the assumption that validators are unlikely to collude. Bitcoin mining is also based on the assumption that it is unlikely that somebody will have enough computing power to break the blockchain.

RSA security based on assumption that it is unlikely that somebody can factorize a big number.
Bitcoin and RSA are protected by economical laws (resources are limited). See the difference?

Yes I know the difference. Both approaches have pros and cons. Both are fine to me as long as they work.

[zeta1]

No i don't think it is a scam, they still have to distribute an amount of the created ripple though