Topic: Ripple distribution by proof of work? (Read 1894 times)

Fully decentralized distribution of XRP is at odds with the stated goal of OpenCoin's business model which is to hold XRPs and hope they increase in value. While it is possible that some of the promised "free" XRP disbursement may be given out through proof of work, I am locking this thread and preparing a new comprehensive summary of what we know.

I maintain that ripple IOUs (or Colored coins IOUs or OT IOUs) can be made legally enforceable by binding them to legal contracts, but they're not enforceable by default.
Credit is not scarce, at least not in the cash-money sense.

If your definition of money only includes scarce money, you're leaving out a lot of alternative currencies. All mutual credit based currencies like LETS, WIR...
Probably more than half of the currencies in this list: http://www.complementarycurrency.org/ccDatabase/

But it's just depends on the definition of money you're using. With mine, Ripple (the IOU part) is also money, although not a currency. Is a money to create currencies.

I don't agree with everything that is said there, but if you watch the documentary "the money fix", you may understand better what I mean when I say "abundant monies".
With LETS, money is just created when needed. A shorter and very enlightening video (at least for me) is this one: http://www.youtube.com/user/utunga#p/a/u/0/ySzqM5dpF7s

Here's a post explaining why PoW is the best system available for decentralized distribution: intalk.org/index.php?topic=145743.msg1570506#msg1570506

Insofar as they are legally enforceable, IOUs are scarce. Money absolutely must be scarce.

So the best thing to do is to create an artificial market that's really serving no one (xrp mining) to last thousands of years?
I thought you were worried like me about the time it will past until the currency can really float freely. Them keeping 50% also scares me, but I'm not sure what's really their plan for the other 50%.
But I would prefer opencoin to sell them all in a few years than having wasteful miners as an inseparable part of the currency pricing for thousands of years.
And even if you choose the same period of time for both systems.
Why is better to through the value "created out of nothing" to an energy and tech equipment hole and some profits to miners instead of profits and costs covering for the people that made it possible?

I'm more worried about their long term plan to through "all" them out than about them making profits from the issuance, although I must admit I don't particularly like seignorage.

But you Austrians must face it: the cost of producing non-inflatable money has dropped near zero and there's no excuse for gold anymore.
I'm very optimistic about that. Maybe Nielsio won't get there, but you bitcoiners understood that money doesn't need any "backing" or "intrinsic value" nor force to be valuable.

Money is a technology, a tool, but it's also an implicit agreement among its users to accept it as an abstract symbol (sorry for the redundancy) of value to conduct commerce.
Money doesn't even need to be scarce, it can be based on credit like LETS, WIR, C3, Ripple (IOUs)...
But even for scarce monies like xrp, btc and frc, the commodity-money discourse will eventually disappear.

Is not that gold can't be money, is money and will probably be more used as such after the usd collapses: it's just that it fits better in circuits and cables than on vaults, pockets and internet messages.
And it's not that GPUs and ASICs can't be used for cash issuance: it's just that they're better used for securing bitcoin/freicoin and making real world useful computations. Even putting aliens on gamers screens or looking for them @SETI is a better use for a GPU than issuing xrp.

It is fair to people who use the Ripple network. Because with proof of work there is no barrier to entry. Anyone can mine for XRPs. Compare that to the current situation, where no one can obtain XRPs independently. We have to beg OpenCoin for them. Mining doesn't necessarily guarantee that there will be an even distribution of XRPs, but I argue that without the biometrics this will be true no matter what. Look at what's happening right now. There are some special accounts that got millions of XRP (I presume these are gateways that got a large grant from OpenCoin). And there are people who have accumulated XRPs by buying them on the open market. At least with proof of work there is competition and we get the free market working to discover the real price. With the current situation the price is wholly determined by the open market XRP operations of OpenCoin.


We're using different definitions of fair. Miners will certainly be a privileged class under a proof of work system but like I said at least anyone with the desire can join, and competition will drive the cost of XRPs down to market clearing rates.


Proof of work would be solved every ten minutes, with the reward equal to 2,000 XRP. This will distribute the entire block of 100 billion XRP over a period of one thousand years (the Ripple wiki states that a hundred billion XRP should be enough for "thousands of years" worth of transactions). The difficulty would adjust every 200,000 blocks to keep the reward at 2,000 XRP per 10 minutes. This could easily be incorporated into the existing Ripple ledger and software.


It doesn't serve security but it does produce XRPs so you could say that the proof of work serves to discourage spam. It is not "throwing energy in the toilet". The amount of energy expended via proof of work for XRP distribution will be exactly equal to what the market thinks that XRPs are worth in terms of a spam preventative and currency.

1) Fair to whom? After several attempts my parents still don't understand what mining is, they would not be able to mine a single block even with 100 years of trial and error, all the mining software and documentation and 100 ASICs. There's many people in the world who are more tech literate than them but still DON'T HAVE THE INFRASTRUCTURE TO MINE!! All those kids with their OLPC...
I guess they all should be excluded from the monetary revolution because all these peoples don't have the means or the knowledge.
Long life to miners and screw everyone else!! Miners are less than 0.0001% of the world population? So what? Non-miners still have traditional banks, right?

2) What's the "fairest" difficulty? Is there any difficulty adjustment algorithm? What does it target?

3) Also, that proof of work is not serving any security need, Am I the only one that feels that's simply equivalent to throwing energy to the toilet?

XRP distribution via proof of work in a fashion identical to Bitcoin is orders of magnitude more fair than the current scheme.

I don't think they're trying to sell Ripple on privacy-enabling features. From the Ripple wiki (https://ripple.com/wiki/Introduction_to_Ripple_for_Bitcoiners):
"Anonymity is not a design goal for ripple. ripple does have features to provide privacy."

True, and that uber nefarious NSA Carnivor program retains every IP & Cell network packet in a permanent Utah data repository too :-)

How paranoid do you wanna get about this ?

Well if it's a gmail account, Google saves every message ever received or sent. So it would be easy to associate the gmail address with the Ripple public key.

OpenCoin Inc or the ripple network itself would not need to retain those aged email addresses but only to use the roundtrip verification to one as sufficient proof to create and pre-fund an account.

Google, facebook and friends certainly know it they might even expose it through some API with user's "allow" permission of course, that might be under "Basic Information about your account"

This would take away the anonymity that Ripple offers.  They are trying to sell Ripple on its privacy enabling features similar to that which bitcoin can offer.  I know most people don't care about their online privacy but bitcoiners tend to do so more than the average person when it come to tx's.

How/where can you look up the age of a gmail or yahoo or hotmail etc account?

-MarkM-

Simply requiring aged gmail or yahoo accounts helps prevent multi account sign ups, similar to how only aged bitcointalk.org accounts receive the giveaways.  Gmail had referrals by friends in its beta early access period, same can be done for ripple accounts, this would just create some scarcity for them at first.  Encouraging connectivity in the long run is desirable to create viable paths in the network, for now that maybe deferred.

For one thing, this would allow people to sign up for as many accounts as they can create email addresses, and receive XRP for each of them. Second, connecting (extending trust) to friends and family is not necessarily desirable, and it shouldn't be encouraged unless you have a good reason to do it.

At the moment the ripple network has a lot of isolated disconnected nodes.  It's not enough to distribute initial XRPs, one must also ensure enough incentive for people to connect to each other and to establish at least minimal lines of trust in their local currencies or BTCs.

Why not do a cascading distribution where people get an initial allocation for simply signing up, solving a CAPTCHA and verifying their email by clicking on a link and then they would get additional bonuses over time for connecting out to friends and family ?

Honestly I don't remember what I was getting at there. The giveaway seems alive and well at this point. Comment retracted.

Can you clarify what you mean by this? I'm genuinely puzzled.