The difference between Ripple and Bitcoin

[hypostatization]

The first question I have is why is an XRP currency unit needed in order to keep the ledger of IOUs? That's not how Ripple started...

XRP are functional component of Ripple. I gave some details above. Pathfinding is essential for cross-currency payment. Liquidity only need exist between XRP and each external currency. Having a cost associated with ledger entries helps prevent ledger flooding attacks, as well as the small portion of XRP destroyed in every transaction.

Second, if you say XRP currency was created to raise money I don't have a problem with that, but it should then be done as an alt-coin, the cryptographic model people are familiar with and respect because they know there are no shenanigans for the market. Everything is independently verifiable.

Ripple not having mining was an intentional design decision, to increase computing efficiency and network speed.

I recommend watching the interview with Chris Larsen linked earlier in the thread. He is candid about the targeted utility of the network and immediate business plans.

[acoindr]

The first question I have is why is an XRP currency unit needed in order to keep the ledger of IOUs? That's not how Ripple started...

It's used to prevent spam in the ledger and provide ease of currency exchange.  For example:  BTC -> XRP -> Yen  Or USD -> XRP - Frequent Flyer miles  Whatever!

I addressed this above. There is no spam concern because there is no distributed block chain with data storage and bandwidth pressures.

XRP is a math-based currency just like any other.  Why would it need to be a copy of the Bitcoin source to be legit?

I didn't say it did. I said it needs to be mathematically verifiable. Show me how it is and I'll shut up immediately.

Here's a tip to understanding Ripple...FUCK XRP!!  

You mean only pay attention to the great sounding aspects like external, simple currency exchange, but not to what the "right hand" is doing behind the back with XRP...

[Beliathon]

Here's the difference:

Ripple sucks.

Bitcoin rules.

/thread.

[hypostatization]

... Validation is performed by few parties today, and that is legit ongoing grounds for criticism. As the network grows, that will become less of a concern. ...

You mean because there will be so many suckers at that point the vested interests in Ripple can cash out quite easily?

I agree there would be less concern, for the creators...

No, I mean that additional Validators will come online, helping to ensure ledger integrity.

Also: Ripple Labs will make far more money from the success of Ripple.

[hypostatization]

Here's the difference:

Ripple sucks.

Bitcoin rules.

/thread.

My take:

Bitcoin rules.

Ripple rules.

They focus on solving different sets of problems.

[acoindr]

No, I mean that additional Validators will come online, helping to ensure ledger integrity.

So Ripple's ledger integrity is to be validated at a later time, just not now. Mmhmm.

[~Coinseeker~]

I addressed this above. There is no spam concern because there is no distributed block chain with data storage and bandwidth pressures.

There is spam concern because there are transactional limits to everything.  If there is no spam prevention, anyone can attack the network with say 100,000 false transactions and grind the network to a halt or at least significantly slow the process of transactions.

I didn't say it did. I said it needs to be mathematically verifiable. Show me how it is and I'll shut up immediately.

I'll have to let one of the "math guys" deal with that.  Maybe JoelKatz is around.  

You mean only pay attention to the great sounding aspects like external, simple currency exchange, but not to what the "right hand" is doing behind the back with XRP...

Why do you care what's going on with XRP?  How does that affect yours or anyones ability to utilize the network.  If you don't like XRP, don't use it.  Ripple is currency agnostic.  For people that only want to deal in BTC payments from here till infinity, Ripple will likely have no benefit.  For everyone else, there is tremendous value and when you start talking about hosted wallets, most people on the planet won't even know XRP exists.  So I fail to see how any of this is relevant.

[hypostatization]

No, I mean that additional Validators will come online, helping to ensure ledger integrity.

So Ripple's ledger integrity is to be validated at a later time, just not now. Mmhmm.

Already expressed the small number of Validators as a legit criticism. Ledger integrity is only as trustworthy as the Validators on the network. I think Ripple is great, but also understand why that would turn people away today. Not trying to hide anything here. Ripple Labs needs to attract more Validators.

Edit: you may appreciate this explanation of consensus

[acoindr]

There is spam concern because there are transactional limits to everything.  If there is no spam prevention, anyone can attack the network with say 100,000 false transactions and grind the network to a halt.

Okay, then use a cryptocurrency to prevent spam. In fact, you could use Bitcoin. The way to prevent spam is simple, which is attach a cost to an electronic action. Spammers are successful only when their cost to spam is negligible.

Why do you care what's going on with XRP?  

I'm not sure you understand. Don't you know if there was a hole discovered in Bitcoin which allowed the 21 million to be increased without network consensus it would shake our community to its roots? Possibly even destroy it if it couldn't be patched?

The market is supposed to verify the goods they are being sold are as claimed. The better question is why do you and others seem to suggest we shouldn't care what's going on with XRP?

The original Ripple was brilliant IMO. I was a fan. That did what the current Ripple does and without any underlying currency. The function Ripple purports to solve is real and is a need. I would love for it to be solved. It's unfortunate that instead of focusing on that there seems to be elements of greed and non-transparency seeping in. That sucks.

[freequant]

XRP is a math-based currency just like any other.  Why would it need to be a copy of the Bitcoin source to be legit?

I didn't say it did. I said it needs to be mathematically verifiable. Show me how it is and I'll shut up immediately.

Last ledger is the product of a distributed consensus between validators.
Validators will accept a ledger N if and only if there exists a valid transition from previously validated ledger N-1. A valid transition between two ledgers is a set of transactions that are legal as defined by the Ripple protocol. There is no legal transaction in the Ripple protocol that allows to create XRPs, and XRPs can only be moved between accounts or destroyed as transaction fees.
Therefore, a valid transition between two ledgers can only maintain the number of XRPs in circulation or reduce it, and from that property, it derives that the only XRP that can ever be created need to be created in Ledger 0 (or genesis ledger).

[~Coinseeker~]

Okay, then use a cryptocurrency to prevent spam. In fact, you could use Bitcoin. The way to prevent spam is simple, which is attach a cost to an electronic action. Spammers are successful only when their cost to spam is negligible.

They did, it's called ripples or XRP.

I'm not sure you understand. Don't you know if there was a hole discovered in Bitcoin which allowed the 21 million to be increased without network consensus it would shake our community to its roots? Possibly even destroy it if it couldn't be patched?

Even if this happened, it would have negligible impact on the network because XRP is not a speculative currency.  It would certainly affect the value of XRP but XRP values do not determine the success or failure of the network.  

The market is supposed to verify the goods they are being sold are as claimed. The better question is why do you and other seem to suggest we shouldn't care what's going on with XRP?

The original Ripple was brilliant IMO. I was a fan. That did what the current Ripple does and without any underlying currency. The function Ripple purports to solve is real and is a need. I would love for it to be solved. It's unfortunate that instead of focusing on that there seems to be elements of greed and non-transparency seeping in. That sucks.

That's your personal opinion.  I don't share that view and have no issues with RL's turning a profit off XRP, should it's value rise one day.  The reason people shouldn't care about XRP is it's not a speculative currency and it doesn't affect ones ability to utilize the network.  It has a very specific function and I know for those that only know "bitcoins" that it's hard to understand anything else.  Ripple is payment network first....XRP second.  The reverse is true for Bitcoin and that's why people get hung up on XRP.  

[acoindr]

Therefore, a valid transition between two ledgers can only maintain the number of XRPs in circulation or reduce it, and from that property, it derives that the only XRP that can ever be created need to be created in Ledger 0 (or genesis ledger).

Okay, if you say so... but what about this:

The oldest available ledger is #32570 (with about 100 entries) so this is currently the genesis one, the older ones are presumably lost or at least not available until JoelKatz finally publishes the transactions that took place in these first 1 1/2 weeks so these ledgers can be restored back to 0. Since then there is a unbroken hashed chain of headers (also cryptographically linked to the transactions and account state at each point of time). Nodes verify this by getting the most recent finalized ledger and continuing from there. Since transactions in Ripple only operate on account balances, not on inputs like Bitcoin, and you can only branch at the top not "mine" on an earlier "block", there is no explicit need for keeping history, not even headers.

Why is there this mysterious missing genesis ledger? In Bitcoin the creator disappeared, but it's no matter because we have and can verify the genesis block. With Ripple it's backwards, we have the creators but the verifiable origin of Ripple amount is a secret.

[freequant]

There is spam concern because there are transactional limits to everything.  If there is no spam prevention, anyone can attack the network with say 100,000 false transactions and grind the network to a halt.

Okay, then use a cryptocurrency to prevent spam. In fact, you could use Bitcoin. The way to prevent spam is simple, which is attach a cost to an electronic action. Spammers are successful only when their cost to spam is negligible.

XRP is a crypto-currency.
Using any other crypto currency for that purpose would require Ripple to juggle with multiple chains, would increase significantly the load on that chain, create a dependency between Ripple and a currency that may not necessarily be future-proof due to the high energy cost of proof-of-work mining, and serve no purpose since Ripple already has a very efficient distributed ledger where it can handle it's own native math-based currency.
Among all crypto-currencies, Bitcoin is probably the worse fit as fees are orders of magnitude higher than current transaction costs in Ripple, and scalability is very limited.

The original Ripple was brilliant IMO. I was a fan. That did what the current Ripple does and without any underlying currency.

If the original Ripple didn't need an underlying currency, Ripple Labs's product wouldn't be called "Ripple" today.

[hypostatization]

Why is there this mysterious missing genesis ledger? In Bitcoin the creator disappeared, but it's no matter because we have and can verify the genesis block. With Ripple it's backwards, we have the creators but the verifiable origin of Ripple amount is a secret.

Validation is handled via consensus. Consensus would be required for any ledger changes that modified the amount of XRP. It does not work like Bitcoin.

Modifying the ledger to alter the total number of XRP or their distribution requires Validator consensus.

If you do not believe in the value of the consensus process, then Ripple is not for you. Validation is a current weak point---given the small number of active and widely trusted Validators---and another possible reason why Ripple may not be ready for you. I do, however, personally believe in the fundamentals of the consensus system.

[acoindr]

XRP is a crypto-currency.

It's apparently not a verifiable one.

Using any other crypto currency for that purpose would require Ripple to juggle with multiple chains

How so? Simply attach a transaction fee payable in Bitcoin (or something else).

, would increase significantly the load on that chain, create a dependency between Ripple and a currency that may not necessarily be future-proof due to the high energy cost of proof-of-work mining, and serve no purpose since Ripple already has a very efficient distributed ledger where it can handle it's own native math-based currency.
Among all crypto-currencies, Bitcoin is probably the worse fit as fees are orders of magnitude higher than current transaction costs in Ripple, and scalability is very limited.

Cryptocurrencies are made to transact value, so using them for transactions isn't Ripple's problem. Let's say that Ripple was truly concerned about that though. Then why not create Ripples own crytpcurrency alt-coin, and with a verifiable block chain. If there are arguments to using a block chain, and it's preferred to do it the way they have with a "genesis ledger" then okay, why not do that and give it the same level of mathematical check availability?

The original Ripple was brilliant IMO. I was a fan. That did what the current Ripple does and without any underlying currency.

If the original Ripple didn't need an underlying currency, Ripple Labs's product wouldn't be called "Ripple" today.

I'm not sure what it has to do with anything, but that's not my recollection. I visited Ripple's site before Bitcoin became big, I'm pretty sure it was before I heard of Bitcoin and I've been around since very early. At that time "ripple" was about connections between people - friends and friends of friends - using those relationships to be able to transact value in the form of IOUs, for anything, like dollars. I thought that was a very cool model, but there was no "XRP" or mention of cryptocurrency in existence at that time. There didn't need to be, because it was all about social network relationships.

[hypostatization]

I'm not sure what it has to do with anything, but that's not my recollection. I visited Ripple's site before Bitcoin became big, I'm pretty sure it was before I heard of Bitcoin and I've been around since very early. At that time "ripple" was about connections between people - friends and friends of friends - using those relationships to be able to transact value in the form of IOUs, for anything, like dollars. I thought that was a very cool model, but there was no "XRP" or mention of cryptocurrency in existence at that time. There didn't need to be, because it was all about social network relationships.

Check out the interview. It will help you understand Ripple and XRP better than a forum flame war

[davidpbrown]

I see value in community members informing the broader Bitcoin community of organized attempts to mislead it, whether it be the history of Ripple detractors or MtGox.

I am not defending the communication quality of Ripple Labs.

but you are trying to defend Ripple and partial in presenting that. There's value in a balanced; rounded; and not partial, presentation of problems.

I agree, in general, about the weak launch. Again, I consider market liquidity, services, and developer adoption more significant than XRP value. Basically, Ripple Labs emerged from stealth mode too early---and exposed Ripple to an attack campaign that they were not ready to handle. Ripple Labs is starting to gear up to improve communication, but it will take time.

Again, you're trying to make excuses.


My impression is that whatever Ripple might be, is not related to cryptocurrency as currency. Significantly then, it seem that XRP are not meant to ever be valuable in and of themselves. If all Ripple'n'Co. did was make that clear, it would avoid the naive user spending money on those XRP. Leaving people open to make mistakes whether by neglect or deliberate ambiguity, is essentially exploitation and should not be encouraged.

If XRP are meant to hold value, then what we know of the spread of them looks very suspect; if XRP are not meant to hold any value and they are to be given away to oil the machines of whoever wants to host a server, then that has not been made clear. Either way, Ripple support sucks at communicating what is intended, relative to other Bitcoin2.0 protocols who are doing that better and more openly. Consequently, all I've seen of Ripple, is pushing people away - people who by rights should be the most enthusiastic of all.


*Give me a load of Ripple, maybe I'll like it more.. but why would you do that, if they are valuable? rJ2zDmzhxQNspB6RsxKgp8Ro1odEsACCEx

[acoindr]

If XRP are meant to hold value, ...

Of course they are meant to hold value. XRP is currently second to Bitcoin in market cap apparently at around $1.5 billion: http://coinmarketcap.com/

[davidpbrown]

If XRP are meant to hold value, ...

Of course they are meant to hold value. XRP is currently second to Bitcoin in market cap apparently at around $1.5 billion: http://coinmarketcap.com/

Surely you're just falling into that simple illusion they've setup?

If I create 99,999,996,303 of my own coin and sell only 10 of them for $10 each, do I have a market cap of $999,999,963,030? I know economics is absurd at times but surely that's just a bad joke.

[freequant]

Using any other crypto currency for that purpose would require Ripple to juggle with multiple chains

How so? Simply attach a transaction fee payable in Bitcoin (or something else).

How does the Ripple client pay the transaction fee if it is offline from Bitcoin? If your answer is offline transaction, then how does the Ripple client knows what Bitcoin transaction outputs to use to pay the fee? And who will push the new fee transaction online? The rippled server? Then it needs to be a Bitcoin client as well.
Then comes validators: how validators know that the output of the attached Bitcoin transaction have not already been spent if they are not themselves Bitcoin client receiving the Bitcoin blockchain?